There have been debates whether a country should consolidate its political or economic base first. On balance the consensus is in favor of the latter – the economy should form the foundation upon which to build the nation’s democracy and governance. The importance of the economy was recognized from the early days of Uganda’s protectorate. In his letter dated July 1, 1899 appointing Sir H. H. Johnson as Special Commissioner for Uganda, the Secretary of State, The Marques of Salisbury, stressed that the main object in Uganda was to organize the administration on lines that would facilitate the development of the economy to meet the requirements of the Protectorate. The issues of land tenure, agriculture, transport, trade and currency occupied center stage of the Commissioner’s work during his stay in the country.
Although a trade unionist, Obote understood the importance of the economy in Uganda’s post independence development. During the early part of UPC I (1962-1970), apart from being Prime Minister Obote also served as Chairman of the Planning Commission. He stressed the importance of economic independence through rapid economic development. Agriculture and rural development the source of livelihood of the majority of Ugandans, raw materials for industries and export earnings were given pride of place in Uganda’s first 5-year development plan (1961-1966). During UPC II, Obote did not lose sight of the importance of the economy in Uganda’s development. That is why he added the post of minister of finance to that of the president.
Amin whose career from age 20 (born in 1926) had been in the military until he abruptly became president in 1971-79 had no clue about the economy much less its role in the country. During the decade Amin was interested in survival. The economic war (expulsion of the Asian community in 1972) was not to develop and indigenize the economy and improve general welfare but to survive politically. Asian businesses were used for patronage and given to people least qualified to run business ending up with under-development. He also instructed that any unutilized land be cultivated to boost economic growth harvesting massive de-vegetation instead. Uganda ended up with abject poverty, reversion to subsistence agriculture and severe ecological devaluation which undermined the basis for political development.
Museveni’s military background and inherent sense of insecurity for his survival led him to give top priority to security matters, disproportionately allocating time and resources to this sector becoming minister of defense besides being president, hoping that security would pave the way for economic development and poverty eradication with minimal government intervention. He basically left the economy in the hands of foreigners (he did not want experienced Ugandans around him and encouraged them to stay in exile earn foreign currency and send some to relatives in Uganda) through privatization of public enterprises and filling key positions in strategic ministries especially finance and central bank with young and inexperienced foreign experts. Uganda basically became a center of experimentation in stabilization and structural adjustment programs (SAPs). It was believed that security, private sector and market forces left on their own would increase economic growth and distribute the benefits through trickle down mechanism. Agriculture which is Uganda’s main economic sector and home to some 90 percent of total population (depending on how an urban area is defined) receives no more than 4 percent of the nation’s annual budget.
Thus the period of leadership with military background from 1971 to 1979 and since 1986 has witnessed a poor record in economic performance and environmental protection in the sense of meeting basic needs of food, education, employment, healthcare, clothing and shelter and protecting fauna and flora. These economic problems are impacting adversely on political development, peace and security in Uganda.
It was in recognition of the importance of economic development that when Ugandans met in Los Angeles (USA) in July 2011 to form the United Democratic Ugandans (UDU) an umbrella organization of Ugandans opposed to the NRM system placed an emphasis on drawing up a National Recovery Plan (NRP). The UDU committee was instructed to formulate the Plan and present it at the October 8, 2011 conference in Boston (USA) for debate and adoption. It was the only item discussed during the one day conference. Although the plan has chapters on democracy and governance and foreign and regional matters, the bulk is about economic and social development that is equitable, sustained and sustainable.
Unlike NRM’s unbalanced focus on urban and service sectors (Kampala City with a population of under 2 million against 33 million for the entire country generates some 70 percent of Uganda’s GDP) NRP has a balanced focus on agriculture and rural development, agro-industries, infrastructure (roads and affordable energy) and institutions such as extension and research. Priority is accorded to small holder farmers who have been recognized at national, regional and international levels including by the World Bank as efficient, productive and socially and environmentally friendly when adequately facilitated by the government. The final National Recovery Plan accessible at www.udugandans.org has stressed the importance of securing and retaining sufficient land for small holder farmers, human capital formation through proper nutrition, quality and relevant education and health care in preventive and curative aspects. A healthy, well fed, well housed and well educated (in quality and relevance) Ugandan is a tremendous economic asset.
The Plan was also prepared mindful of Uganda’s experience with Amin, Uganda National Liberation Front (UNLF) and Okello governments that came to power without a development program causing unnecessary delays and suffering to the population especially children and women. Should a transitional government be formed, the development plan is ready and there is no need to reinvent the wheel. However, implementing the plan will require leadership of economists different from those in the NRM government. NRM came to power when the neo-liberal doctrine known as structural adjustment program (SAP) based on market forces and limited role of government was in force. Its focus was on macroeconomic aspects especially controlling inflation to single digits by keeping interest rates high to discourage too much money in circulation. This approach severely constrained micro, small and medium enterprises from borrowing and investing in expansion of or starting new enterprises that create jobs and contribute significantly to economic growth thereby distributing income equitably. The neo-liberal economic model was abandoned globally and in Uganda in 2009 having failed to deliver as expected. A new model based on public and private partnership to address the economic recession and the associated high levels of unemployment and disguised unemployment (inferior jobs with low productivity) challenges has been launched to stimulate the economy in developed and developing countries except in Uganda which has continued to be concerned with inflation control (now out of control largely because of overspending on 2011 elections).
The NRP was drawn up along the lines of public and private partnership to address low investment and unemployment challenges. As noted above, its implementation will need economists with experience in Keynesian economics of demand management and job creation that is required during this period of economic difficulties when government spending in productive sectors that create jobs should be boosted, not curtailed. The NRM economists experienced in Friedman’s monetary economics with a focus on money control are not suitable for the model upon which the NRP was based. Besides, the National Recovery Plan was prepared as an alternative to the NRM policies to use different tools especially increased strategic role of the state and to realize different outcomes particularly job creation while not forgetting inflation.
For peace and security and democracy and good governance to be realized Uganda will need to balance demands for the economy and for security. Too much attention to security at the expense of the economy has led to economic problems and in turn to instability. Therefore the economy should be adequately funded and led by economists that are familiar with a branch of economics that boosts the strategic role of the state and gives priority to employment who are different from neo-liberal economists in the NRM government since 1987 that have focused on macroeconomic stability. The five-year development plan which replaced structural adjustment program in 2009 contains many elements of neo-liberalism and has not even been implemented in large part because there is no will and funds.
The Boston conference instructed that the Plan should be distributed as widely as possible and elaborated for better understanding of what needs to be done to transform the economy and create a middle class society. Uganda is well endowed and without political squabbles and greed and desire for domination no child should die from malnutrition or drop out of school for lack of school lunch. Given an opportunity UDU plans to address this suffering head on. We appeal to all Ugandans and development partners to be an integral part of this Plan and give it the boost it deserves.