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Posts Tagged ‘economy’

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It’s amazing how reading the book ‘Dead Aid’ by Dambisa Moyo has suddenly made me very aware of how the misuse of development aid is destined to keep us poor and dependent. I have not had to wait more than two weeks before the the personification of this fact appeared in the form of the hideous deputy prime minister Gen. Moses Ali.

The issue at hand was the revolt by young members of parliament who would simply not approve a world bank loan because they felt that the reason it was being sought was did not seem to be for the benefit of Ugandans. In short they were saying that we do not need to borrow money if we do not need it.

Common sense, one would think. That was until the honorable retired general Moses Ali stood up and told the rebellious members of parliament to just approve the loan and leave the discussion of the details to another time as the World Bank wanted the agreement signed within the next two days!

When the MPs jeered and booed, he responded by saying he could not understand how Uganda could refuse money when it is being freely offered, other countries might get the money instead. The fact that generations of citizens will be committed to paying off the ‘free’ loan was clearly lost on him, or was it? I guess that fact that the fat political classes have been feeding off the carcass of tax payers for years has insulated from the realities of life, or worse they are far too thick to grasp the basics of economics.

The scenario deteriorated even further today. Apparently the Uganda government Spends close to $150million a year on the treatment abroad for Ugandans. Why this is shocking is that this figure is equivalent to the amount that multilateral donors loan to Uganda to support her health services. And therefore as we get more indebted the same money is used to send people abroad for treatment rather than improve health facilities in the country.

But the real devil is in the detail: Who exactly is being treated abroad and for what ailments? The answer is simple, only the well connected senior government officials and their close relatives have a chance of getting approvals from the medical council and the treasury to access this funding. It’s very telling that the permanent secretary for ministry of Health says ‘ you cannot tell people where they should be treated’!!!! With public funding??? I was speechless.

One can only imagine how much would be needed to put Mulago Hospital back on her feet, how much would it take to provide maternity kits in every district hospital, ow much would it cost to provide an ambulance at every health centre. The truth is the people who can bring about change don’t really care, they borrow money in our names and then use it to send their daughters to Germany to have their babies. Dead AID indeed.

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A newspaper headline caught my eye I a few days ago. It was in the ‘New Vision’ paper and it screamed ‘So many workers but not enough work in Uganda’. I instantly knew that the chickens had finally come home to roost.

The article painted really grim statistics indeed: of the 490,000 people who leave school each year for the job market, only 18,000 employment positions are waiting for them. And that’s just scratching the surface. Because only 5% of the Ugandan adult population are considered to be in permanent employment, with rather the confusing statistic from another study showing that 14% of the working population is either under or unemployed.

 We all know someone who went to university to study one thing and then ended doing something else after searching for a job for years. Agriculture, the backbone of the economy, is not seen as an attractive proposition for the school leavers at all. And the fact that the government has not invested heavily in the sector as one would have expected has not helped matters much. So subsistence agriculture rules today.

 How did we get into this right old mess? We only need to look back a few years when President Museveni decalred that what was needed for Uganda to Industrialise was for the country to have a larger population, the end result would be a larger consumer market and hence a bigger economy, like china and India.

 This is a rather simplistic evaluation and was challenged by a few brave peope including the then Head of the Population Secretariat, Dr.Musinguzi. I heard him on the BBC radio a few years ago continuing to express his fears about the ‘lets have lots more children’ policy that the government was espousing.

 Currently Uganda’s population has hit an estimated 32 million this year with a GDP per capita income of $1,200. This is a huge jump from 24 million 10 years ago.

If a large population is the basis of developing a modern and prosperous economy how then do we explain the fact that:

  • Australia:         population 21.1million and GDP per capita $36,700
  • New Zealand: population 4.2 million and GDP per capita $27,600
  • Malaysia :        population 25.7 million and GDP per capita $14, 200
  • Cuba:               population 11.4 million and GDP per capita $8,500
  • Botswana:       population 1.9 million and GDP per capita $13,400
  • Iceland:           population 0.3 million and GDP per capita $40,100

 These are all countries with smaller populations than Uganda and yet have economies that are larger, some even by multiples of 10. Clearly population alone is not enough to explain the small size of the Ugandan economy or that of any other developing nation for that matter.

 Currently Uganda has a birth rate of 47.84 per 1000 head of population, the 3rd highest in the world, giving rise to a population growth rate of 2.6% (24th highest in the world). This is an improvement from the 3.6% growth rate in 2008 (4th highest in the world).

Only Niger and Mali have higher birth rate,  with Afghanistan, sierra leone, Burkina Faso and Somalia not far behind. Really not company Ugandan can feel proud of.

 Contrast this to:

  • Kenya:             pop. 39.0 million and birth rate 36.64/1000 population
  • Tanzania :        pop. 41.0 million and birth rate 34.29/1000 population

 The end result of this warped population policy is an even more frightening statistic: more than half of Uganda’s is aged 15 years and below, that is 16 million youngsters! Can the government continue to ignore the fact we may soon have close to a million youth hitting the job market every year.

 Reducing the public service retirement age from 55 to 50 years is burying the proverbial ostrich’s head in the sand. It works on the premise that the civil service shall be the country’s main employer, and that is not the hall mark of an industrialised economy.

 The worse case scenario is having hundreds of thousands of unemployed and disgruntled youth with nothing to lose roaming the streets. That is a future that must be averted.

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