Why has NRM ignored unemployment in Uganda?

With all the resources in Uganda and donor money and the work that needs to be done, there is no reason why Uganda should suffer the current unacceptable high level of open and disguised (underemployment) unemployment. Instead, youth open unemployment stands at over 80 percent that has triggered mass poverty also at over 80 percent. In a true democratic country, Museveni would have been impeached. But he is still around governing with an iron fist threatening to crush those who oppose his vision of ‘under-developing” Uganda into a Fourth World country and impoverishing over 80 percent of Uganda citizens. NRM dismal performance is a function of two factors.

First, Museveni knows exactly what to do to get Ugandans to work and end unemployment. But he can’t do it because that would empower and encourage Ugandans to oppose his long stay in power. So to keep them powerless and voiceless, he has chosen to marginalize them through unemployment and disguised unemployment. Without paying attention to lessons of history and how unemployed mobs can easily turn revolutionary as in France in 1789 and Russia in 1917, Museveni believes poor people can be sat on forever. If the trend continues recent by-elections are sending a signal that Museveni’s time may be up for voluntary exit or he could face a revolution of French or Russian style led by poor, hungry and unemployed mobs – and we have plenty of them in Kampala and elsewhere. Don’t rule out the possibility of disgruntled security forces joining the mobs. There are rumors that cracks are opening up in some sections of the forces.

I have had conversations with some of his senior ministers who have stated probably unconsciously that the government is scared of creating a middle class. That is why Museveni doesn’t want educated people around. He has encouraged them to seek work outside and refused Ugandans in exile to return after he captured power in 1986 when he needed seasoned professionals (he preferred junior European experts working with his poorly educated and inexperienced NRM cadres who couldn’t negotiate a barter trade agreement and messed up privatization of public enterprises for instance). With cash in its pockets and food on the table, the middle class would then demand political freedom. And Museveni has no intention of leaving state house voluntarily. He has instead launched campaign for another term after 2016.

With sufficient political will, addressing unemployment is relatively easy. The first and immediate thing to do is to launch public works programs. We have roads that are in need of repair, we have isolated areas from the outside world for lack of access roads. We need more schools and clinics, irrigation dams, reforestation of degraded landscapes, wetland rehabilitation and urban street cleaning, etc. Public works in these areas in all parts of Uganda would employ thousands and thousands of unemployed youth. With money in their pockets, the demand for goods and services would increase. Labor-intensive micro, small and medium scale enterprises would spring into action even faster with low interest rates and employ many unemployed workers. Government would also subsidize companies that hire additional workers.

The next step is retraining. In Uganda there are many skilled jobs unfilled or filled by foreigners. Ugandans don’t qualify because they are functionally illiterate. To overcome this constraint, the government should undertake a retraining program in collaboration with the private sector to identify job prospects in the labor market.

Museveni knows all these avenues to end unemployment and disguised unemployment but lacks political will into concrete action because he fears losing state house by empowering Ugandans through remunerative employment.

Second, Museveni behaves as though he is governing Uganda in the 1950s and’60s when unemployment and inflation were inversely related that is when inflation was high; unemployment was low and vice versa. In such a situation, the government would focus on fighting inflation until unemployment began to rise as inflation declined and the government would switch policy to fighting unemployment. Since the 1970s that relationship (Phillips curve) changed and inflation and unemployment have moved together for most of the time in the same upward direction as in Uganda today. It is therefore unwise to fight inflation alone and leave unemployment to the market forces and private sector which have exhibited imperfections in the labor sector.

It is possible that with foreign advisers obsessed with reducing and keeping inflation in single digit, Uganda has pursued a harsh restrictive monetary policy since 1987, hoping that with more savings the economy would perform better, more efficiently and more equitably and with better prospects for faster economic growth, increased employment and poverty reduction in a context of price stability. But this hasn’t happened. Therefore, UDU proposes that the policy needs to be recast so that a balance is reached between inflation and unemployment. The problem is that Ugandans who have been managing the economy in the ministry of finance and central bank have been there for far too long and they are stuck with monetarism and are unwilling or unable to make substantial changes. Therefore Uganda needs a new team, the kind that prepared UDU’s National Recovery Plan (NRP) with a different approach as was done in 1987 when structural adjustment replaced the ten point program. The minister of finance and governor of central bank were replaced among many others. The changes proposed by UDU won’t be implemented as long as Museveni is still in power because he too, like his advisers, is stuck in monetarism and will be unable or unwilling to start new tutorials on a new public-private partnership model. Ugandans therefore have two mutually exclusive choices to make: retain Museveni and his team and Uganda continues sliding down the slippery road at an accelerating rate into decadence (economic growth has dropped from 10 percent in mid-1990s to 3 percent currently) or replace NRM with a transitional government and resuscitate the economy back to a normal trajectory.

, , , , , , , , , All