At the start of the twentieth century,
Ugandans were growing enough food and manufacturing a wide range of products according
to their comparative advantage that, barring natural disasters or temporary
man-made conflicts, enabled them to trade surplus in local and regional markets
and obtain what they needed. European travelers and explorers were struck by
the vitality, eagerness, intelligence and the life-enhancing quality of
Ugandans. They were dubbed the “Chinese”
and later the “Japanese” of
Winston Churchill was not only impressed by
the beauty of the land, but also by the fertility of the soils, the abundance
of water and the coolness of the air. Compared to other African countries
Churchill said “The scenery is different, the vegetation is different, the
climate is different and, most of all, the people are different from anything
elsewhere to be seen in the whole range of
1967). He called
Africa”. He added that, one day,
great center of tropical production and play a most important role in the
economic development of the whole world.
With entry into the global economy,
mostly of what it does not consume and a consumer mostly of what it does not
produce as a result of Ricadian version of comparative advantage. Consequently,
of cheap raw materials in exchange for expensive manufactured products. The new
comparative advantage meant that
of manufactured products such as iron tools, cloth, salt and wooden products
such as canoes, wooden spoons and combs and focused on the production of
coffee, cotton, tobacco and tea for export to the metropolitan country –
Then in 1986, the
National Resistance Movement (NRM) came to power with a determination to effect
a fundamental change in
society. The Ten-Point Program, later expanded to fifteen, correctly called for
the creation of an independent, integrated and self-sustaining (and
sustainable) economy and the transformation of a peasant-based subsistence
economy into a technology-based modern economy run by the middle class.
Ugandans bought the program and were prepared to tighten their belts even
further so that the program could be implemented and lift them out of abject
poverty.
However, by the second half of 1987, the
NRM government had changed course and to use Ian Leggett’s words the “NRM
buried its initial economic strategy, which was designed to overcome the
colonial legacy of producing what we do not consume and consuming what we do
not produce, and embraced the policies of the economic orthodoxy”. Thus the NRM
wedded its administration to the text book IMF-style economic stabilization and
structural adjustment program based on privatization, liberalization,
deregulation and export diversification. With massive support from the
development partners and remittances by Ugandans as well as the excess capacity
inherited by the NRM government in 1986 and the restoration of peace and
security in parts of Uganda, the economy registered high growth rates at times
reaching 10 percent.
international community as a “successful” adjusting country to be emulated by
other African countries that wished to overcome underdevelopment. As time
passed, the economic growth rate declined, inequalities widened, jobs became
scarce, nutritious and adequate food became inaccessible to a large number of
Ugandans and the environment in towns and countryside deteriorated.
Against this background, the
conference on
past its Prime”. The sub-title conveyed the message that all was not well with
the free-market economic reforms under the Washington Consensus terms. The
title of the conference was appropriately called “Challenges and Change in
In
his keynote address at the Public Expenditure Review Workshop in May 2005, the
President observed that in spite of the achievements made, there were still
challenges that must be tackled, including the need to increase the pace of
industrialization and technological advancement, transformation of the agrarian
economy to one based on modern technology and improvements in the human
development outcomes. He regretted that “Surrendering Sovereignty over
decision-making in exchange for money has, therefore, been a big mistake”. A subsequent two-day retreat of all Ministers
and Permanent Secretaries presided over by the President took place in
September 2006 and debated the way forward. A group of ministers was tasked to
draw up a new vision and strategy to address the development challenges
including poverty.
In carrying out this assignment, the
Ministers should keep in mind the advice from Bruce Bartlett, a principal
participant in the design of Supply-Side Economics in the
Administration. He advised that: “There is no question in my mind that we never
could have overcome the stagflation [high inflation, high unemployment and
economic stagnation] of the 1970s as quickly or with as little pain as we did
without the supply-side idea [cut taxes, reduce government size, increase
savings, stimulate private investment, increase economic growth]. But
supply-side economics has done its job, just as Keynesian economics did [after
World War II]. Those who campaign as its champions are fighting a fight long
won – and it is time for supply-side rhetoric to go, with its essential truths
embodied in mainstream economics and its perversions discarded for good” (New
York Times, April 6, 2007; Monthly Review, April 1983).
Similarly,
low inflation and the economy has been growing at an average of 6 percent
annually since the 1990s. It is time to pay more attention to other current
pressing challenges such as unemployment, energy and other infrastructural
bottlenecks, income inequality, quality education and health care services,
environmental degradation, food and nutrition insecurity and industrialization
or value addition to
skill-based industries. To address these pressing challenges adequately, the
role of the state will need to be redefined to take care of market imperfections
and to design new tools that are different from those the NRM government has
applied at the start of its structural adjustment program in 1987.
On industrialization and transformation to
a modern economy and society, it is important to note that “Without protection,
many economies [including Uganda’s] would never start to develop industrially,
but would remain forever specialists in primary products, their livelihood
depending on uncertain market prospects and terms of trade, unable to provide
the employment that they require and forever completely dependent on other economies.
But at a later stage of development a more open economy may allow advantage to
be taken of economies of scale, of returns to specialization and of comparative
advantage… Thus the appropriate question is not free trade or protection, but
free trade when or free trade and protection (G. K. Helleiner, 1976).
natural resources to address adequately the challenges we face in this century.
The challenges have been adequately analyzed. We therefore need less talk and
conferences and more implementation of the recommendations. The state together
with the private and civil society organizations need to pull their resources
together to make the necessary changes and bring about the desired results that
enable all Ugandans to realize their basic human rights.
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