The Real and Vulnerable Economy: An Introduction

Published on 26th May 2020

There are two types of economies. The first type is the economy that people need in order to survive and to live a good life. Then, there is the economy of pleasure and leisure. If I was to put it in Runyankore, there is the economy of okubaho (to survive) and the economy of omwiguto  (pleasure). The big mistake has been not to understand that there is the economy for real survival and livelihood and the economy for leisure and pleasure.

Real Economy for Livelihood and Survival

The real economy for livelihood and survival has nine sectors: ´Sector One is Food - producing food and processing it. So, all activities involved in producing food, processing it and transporting it are very crucial for the survival of human beings. The second sector is clothing. Once you deal with food, the next need you have to deal with is clothing because you cannot go naked. You need clothes. The third need is shelter - where to be. You need a house where to live. The fourth one is medicine. If I am sick, where do I go for treatment? The fifth one is defence or security. These are the spears, the shields and the arrows for protection. But, of course, now we are talking about new types of spears. We are not talking about the other old ones. 

The five basic human needs are food, clothing, shelter, medicine and security. But you cannot get these five unless you do something else. That is what gives you the sixth sector, infrastructure. How will you process food if you do not have electricity? How will you transport it if you do not have the roads and the railway? How will you have factories if you do not have piped water? 

In the olden days, in Ntungamo, I could stand somewhere near Nteera and shout; I would call: “Iwee!!!” and the people would hear. That can no longer work. We shout through the phone. That is how we communicate. So, that is the sixth sector which is very crucial - the need for the utilities that enable the other five sectors to operate.

I have talked about medicine. You can have medicine but lack the infrastructure to dispense it. You need the infrastructure of health. The health centers, that network and the employees; the personnel to deal with health. So, that is crucial area number seven. Number eight is education because to do all the other things we have talked about, you need education - educated people. Education gives you the ability to read and write, the numeracy; to count, the skills, to do things with skills and intellectuality, to be highly knowledgeable and able to deal with big problems.

Originally, I had thought about these eight but when I interacted with some people, they pointed out something else. They asked me how I deal with corruption. They told me that the only way to deal with corruption, apart from taking people to Kyankwanzi, is to deal with the spiritual side. To sensitize people to know that they are not only accountable to both man and God. So, Spirituality is need number nine. If you have these, you can survive and even thrive.

The economy of pleasure and leisure

One of my daughters had abandoned me with my cows and went into tourism in Bwindi with the Bafumbira. This is a new activity for the Basiita, for my clan, not to be in cows or crops and you go to take people to see wild animals. If I can make money, alright but if it cannot, I am not worried. I can go to look after my cows.  Some of these sectors like tourism, hotels, entertainment, bars, music, dancing, sports; you know, I am a sports man; but if the football matches are cancelled, I will not die. I will wait. These are economies of leisure and pleasure. 

The other economy of Tourism, one incident of a terrorist throwing a bomb, the tourist cancels, “Ooh! there is a danger of terrorism.” Sometimes the governments, especially western Governments, are fond of undermining our economies. They give advisory: “We think it is not safe to go to Uganda.” The bookings are cancelled. As you have seen with the coronavirus pandemic, it became hard for people to travel. Even if we had not banned travel, I am sure people would cancel travel by themselves because they were afraid.

The good fortune, where I want all of us to concentrate, is the economy of survival and livelihood. So, in real economy, for instance, with food, whether there is war, whether there is an epidemic, food will be needed. Sometimes, it will even be needed more than when there was no problem.

There is a lot of money and jobs which we have been either not getting or losing to the outside. Look at the imports of Uganda. Uganda is still importing animal feeds. Why should Uganda import animal feeds? These are from kyakyu, which is from maize. We have a lot of maize; we do not know where to sell it. The other time the price had to collapse, but yet we are importing animal feeds. So, let that gap be closed. No more importing animal feeds. Let our private sector, assisted by the UDB, go into that area and make sure that there is no importation of animal feeds. How much money will that save us and how many jobs will it create? It is what I am challenging you now to analyze.

Then you come to Sugar. The Basoga were crying with Ebikadho, “ebikadho bingi kamala,” (the sugar cane is too much). Ebikadho bityayimye. The sugar canes are there. Then, when you look at the import figures of Uganda, Uganda is importing sugar - what they call Industrial grade sugar. East African industries do not make sugar for putting in Coca Cola. The only sugar they are making is this one for kachai - for tea. When I saw that sugar was taking about 30 million dollars from our Forex earnings, going to buy refined sugar used for making Coca Cola, I got surprised. 

We have a factory for making medicines, called Cipla Pharmaceuticals (Quality Chemicals). They use what they call Pharmaceutical grade sugar. It is like the one which is used for syrups for children but that sugar is not here. They must import it from India and China. That is why the tablets are still expensive because they import pharmaceutical grade sugar from abroad. There is a lot of potential in processing,  import substitution and exporting to other countries. 

The Banyankore had started interfering with my work. The other time, I went there and found them saying, “Milk! milk! milk!” I said: “What is wrong with milk’’? Amate gaitu (our milk). They were quarreling the Indians I brought without consulting me first. Because of the milk we have encouraged to increase, there is so much milk now. Milk had gone from 200 million litres a year to 2.6 billion. When the rains came, Kenya said it did not want to import our milk because they had more milk. The milk was threatening to have no market. Fortunately, one of the Indians whom I had brought was not processing milk for drinking - either as fresh milk or as drinking milk.  He was getting a protein called caseinout of milk, used for baby food, supplements and medicine. That man is taking much of the milk now and it is going to the USA.

Look at cassava and maize. Some of the things you put in the medicines is what they call Industrial grade starch which can be used in making tablets. There is an endless list of what you can do with food in terms of industry, which can bring in more money and jobs.

Go to clothing. We are importing a big number of clothes. If you look at money for the imports for clothes, it is quite a lot. Then, there are all the other things like the hospital linen and many other things. Let us stop imports of clothes, support import substitution and also exports in Africa. The global demand for clothes is very huge. I think it is 900 billion dollars. 

From the clothes, we go to shelter. For building, we are no longer importing cement. That is good. We make some mitayimbwa (steel bars).  There are still some kinds of mitayimbwa which you cannot make using recycled steel because we are still using recycled steel-scrap metal. Dams and big houses will not accept this kind of steel.  Therefore, we are going to develop our Steel industry from iron ore (Obutare) to make fresh steel and alloy it - to mix it with other metals which have been exported like nickel and many others. We have them but people have not been using them. That sector will create a lot of jobs.

We are importing a lot of the medicine; tablets, injectables and vaccines. All these take a lot of money and we are going to make them here. We are going to support groups like Quality Chemicals, like the one for making disinfectants for Corona, Saraya and the one that will manufacture Hydroxyl Chloroquine. The Prime Minister of India is going to send us some of these tablets and raw materials to help us make some of our vaccines here, even the vaccines, the injectables not only for human beings, but also for livestock. We are going to make them here.

Defence weapons. We have already started but we are going to expand and rely on ourselves. How can you have a country which cannot defend itself? Our ancestors made spears and arrows for themselves. They did not import them. But now we are importing everything. What kind of people are we? The surveillance cameras we put on the road to record the bad things the people are doing are imported. Why don’t we make them here? The cameras on the roads and the anti-riot equipment. We need all these things here. We are going to make sure that we double our efforts.

In order to do all that, we need the infrastructure; the roads and the electricity. That one, we are doing well. That is why I am sure it will be easy for us to re-orient the economy.

On education, we are doing well. The only lacking thing is for us to have the skills. Members of Parliament should support my plea of paying scientists well. In the wake of coronavirus pandemic,  the doctors are on the frontline. I have not seen any administrator in the ward. My young doctors and my young nurses are the ones on the frontline. When we had the problem of the dam being attacked by the floating island, engineers went there. Maybe the other people who were there, were the rumour mongers, the press men. They were not adding anything, they were just waiting for my engineers to solve the problem.

Then, there is the issue of the locusts in Karamoja. There, the Army did most of the work. So, really, if you want your country to stabilize, let us first stabilize our scientists. These people can do so many things. This gives me a lot of happiness because I know what the situation was in 1961 when I went to Ntare for the first time. There were 40 teachers, only two were African. The rest were whites. When I see the hospitals and dams full of Africans, it is very good.

We are mishandling our scientists. This must stop. Scientists must be paid first. I am tired of begging.  The other time in my caucus, I brought a suggestion to pay scientists better. One of my people said: “Yes, we are all teachers.” Yes, but when the dam was going to break, I did not see you go to read Shakespeare to the dam. When people are drunk, they say, I am also a man. But when you are sober, you discover that other men are much better than you. Scientists can solve a lot of problems. They are running here and there to support their children. That is why some of them have private clinics. If we pay these doctors, we can say: “Nobody should have double loyalty’.’ You will have a high quality medical service.

Once we have the nine, we shall have a bigger economy. Yes, we have lost tourism. Agriculture, forestry and fisheries, 3 million people are working there; manufacturing, 700,000 people; in trade, 2 million. Those can remain there but instead of importing, they can distribute our own goods. I do not mind you trading but you distribute ours. We do not want to say that once we do not import, they will lose jobs. No, they will just reorient. You can distribute or more so export. Why are you a trader by importing? So, I do not think that these ones are in trouble. Hotels restaurants and bars; those were employing 321,000 people. Arts, entertainment and sports, 386,000. So you can see that the big sectors are still there. Agriculture is still there and manufacturing is still there. We just have to consolidate them and expand them. The other economies will come back after the situation in the world stabilizes.

I do not share this pessimism of some sectors that have suffered; but there are some sectors where we can do much better. Who will do what? The government will do its part even in terms of manufacturing. The government gave my office some small money for manufacturing and I told Nakyobe, the State House Comptroller, to solve some issues systematically. The area we shall begin with is leather. We have 15 million cows, 15.6 million goats, 4 million sheep but we have been importing shoes and importing all leather. So, I told Nakyobe to solve the problem of leather. Some of our young people are making shoes because we are encouraging them and we even trained them at Kololo, but they are using imported leather. I do not know where they import it from. Uganda, the land of cattle keepers does not have leather for making shoes. I have told Nakyobe to solve the issue of leather and she has imported machines. We are going to put them somewhere and process leather. So that issue of leather is solved.

I am working with Archibishop Odama on the issue of starch. We are going to use starch for medicine, factories etc. The other Indians of Mayuge, Buikwe, we have agreed that they solve the issue of Industrial grade sugar. We are going to systematically allocate responsibilities. Some will be done by government through UDB and many will be done by the private sector. The private sector has responded and you have seen how they have made the sanitizers. Sanitizers were a problem when this virus started. There was only one factory in Jinja owned by a Japanese in the whole of East Africa. Kenyans were buying from here. Then some people here were saying: “We need the sanitizers, do not export.” I said: “I do not want to hear that language here.” I said: “I am a person of God.” You cannot hear people dying and you say: “The little that is there, is only mine.” And you go to hell. Those who want to go, you can go but do not take me. I said: “I will not allow.” The little that is there, we shall share it. And in no time, my alcohol (waragi) makers, the ones who are making (waragi) for “killing” you people, shifted to now making sanitizers because alcohol (waragi) is a small sanitizer. Apparently, it is about 30%. Now, if you boil it more, it gets to 70% and it becomes a sanitizer. Now, the alcohol (waragi) which was killing our people, has found a new job - to kill the virus. That industry is taking off.

Then the masks. Nytil is already making them and Fine Spinners is already making them. Uganda Industrial Research Institute (UIRI), Doctor Kwesiga is also going to make them. Gloves, protective wear of hospital staff and many other things are going to be made here. By creating jobs, we shall change the economy of Uganda from being an economy of dependency, to being an independent economy and export-oriented. In order to do that, we are going to change the capital base of UDB so that they can lend to all these different lines of entreprises at low interest.

Do not listen to people who are talking doom. ‘They are going to collapse!’’ Yes, they may collapse elsewhere but not here. This is because here, we have got a strong base.

On how to handle workers in this crisis; my advice would be - this business of laying off workers is not a good idea. Things are going to improve. So, why do you lay off? You do not even weigh the words. Because they hear people in Europe laying off, they also lay off. If they sleep on the road, you also sleep on the road. Why don’t you say: “You go home for this month because I have no money to pay and I have not been working. You have seen that for yourselves.” That’s reasonable: “You go home, when we resume, I will call you.” Your own workers, if you have been satisfied with them, why not send them on leave? You may not even have money to pay them, they will understand because they have seen that you have not worked. Why do you use the language of laying off? Why not send on leave, until the situation clears?

If you follow my plan, this economy will grow much bigger than it has been. And there are other fair weather sectors because this one of food, clothing, shelter, medicine are all ─ weather sectors. They will never go away as long as you people are there. Even when there is war, they will be there. The other sectors are there when the weather is fair. They come and go away. I can assure you that even the fair weather sectors will come back.

Quite a number of people in the world have seen that Uganda may be safer than many parts of the world. You people who like to travel, I only travel when I have no alternative. When I go there, there is a lot of air conditioning. I feel like I am dying from there. Otherwise, when I get little time, I go to Rwakitura or Kisozi because I have never seen any part of the world which is better than Uganda. I do not know what you are looking for abroad unless you have different eyes from mine.

I suspect if God gets us through this crisis, even these opportunistic sectors, of tourism, the fair weather, may be rushed here because people have been watching. This place seems to be stable. Some of my people rang me from London before we closed saying: “Please, please get me from London.” So, some of the fair weather sectors may be rushed here, including the medical. This is because the reputation of your medical people has gone up. Those young people are discharging all those people who were sick. I think those sectors will come back; but let us concentrate on these ones. Sensitize the workers, tell them: “If you have been in tourism and it has got a problem, why don’t you look at these other sectors? Then we can work out a plan of skilling and we enhance these technical skills.

By Yoweri Kaguta Museveni
President of Uganda

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