Politics and Government

2026: WHAT SHALL BE THE TITLE OF THE BOOK AFTER 40 YEARS?

Even though, Lee Kuan Yew’s book, From Third World To First: The Singapore Story 1965-2000, covers a period stretching 35 years, he actually, effectively ruled that country for only 25 years ending his rule on 28th November, 1990. However, if the 6 years starting 3rd June, 1959 when he was Prime Minister of a semi-independent Singapore (it was governed by the British as part of Malaysia), then he ruled for a cool 31 years! He, however, in that book, recounts that city-state’s achievements over a 35 year period from 1965 to 2000. By the time he left, the income per person had grown from $516 to $24,000 in 1995, and now, at least $64,000 by end 2019! That is increasing the per capita income in real terms adjusted for US Dollar inflation (making $516 in 1965 equivalent to $2,475.81 in 1995) 9.69 times from its 1965 level to its 1995 rate. And, by end 2019, Singaporeans had successfully made their country’s GDP Per capita one of the highest in the world and grown it in real terms adjusted for inflation 15 times- as the 1965 $516 is about $4,155 in 2019. Without US Dollar inflation adjustment, this is a growth of 124 times more than its 1965 level!

Ugandans, nay, Africans, and especially their leaders of whatever colour love to quote the Singapore story and carry around Lee’s book as a development Bible of sorts. They justify any human rights excesses by, again, pointing to some of Lee’s documented abuses against opponents of his development program for Singapore.

The current regime has been in power longer than Lee was in Singapore. Albeit, we acknowledge a difference in size, demographic and other factors. In 1986, when they shot their way into Kampala, Ugandans’ income was about $260 per person per year on average. After the most recent rebasing by the Uganda Bureau of Statistics, Uganda is a $35 billion economy with 41 million people, giving an average income per person of $853.6! That is about 3.2 times the income they averagely held in 1986 at nominal GDP!

If US Dollar inflation was factored into the calculation, the result would be disappointing. In fact, the US Dollar rate of inflation over the period 1986 to 2019 was 2.55%. It follows that the per capita income of Ugandans in 1986 of $260 is equivalent to $597.6 in 2019! (I am writing the article in January, 2020). The change in incomes per capita is therefore depressed and has only grown by 1.42 times over a 34 year period! It should be borne in mind that these are rates at nominal GDP and not Purchasing Power Parity, which in comparison to Singapore would still be ridiculous.

So, how can one leadership in Singapore (in fact, dictatorship by liberal Western standards) be so good and another-almost all Sub-Saharan leaderships-so abysmal at management of economic growth and development as to qualify to be a failure?

Pages 89 to 102 of Lee’s book probably explain this better than anyone would ever do. It is implementation of projects, stupid! And, world-class at that. There was no second-guessing with Lee. Only the best, even at the lowest level of state and economic management was tolerated. The consequences of non-compliance were dire, including death.

Let us look at our desires and dreams as a country, as against what actually we are doing about it. We shall give a few illustrations. On May 17, 2019, the Kampala Capital City Authority launched the construction of Kasubi Market. The said market would take 4 months to complete. The contract was given to CK Associates, a local construction concern. Ideally, on the morning of September 17, 2019, the first vendors should have occupied the stalls therein. As at January 20, 2020, 4 months ahead of that timeline, the people heading to the Western outskirts of Namungoona, and Nansana still experience debilitating traffic snarl-ups, because the vendors in that market, argue, quite rightly, that they have been using the road as a market since 1958! They spread their ware on the narrow strip that passes for the pedestrian walkway, forcing the pedestrians onto the highway. In this instance, the money was fully available, the contractor is a local who should be proud to be chosen to do the work as they normally aren’t and produce excellent work, the work is not complex in any way, shape or form, and the goodwill is already there. So, what causes a time overrun of as much time (4months, now, and counting) as the initial time of delivery?

The Kampala Light Rail mass transit system, was supposed to be a $500m construction project connecting the East-West suburbs of Greater Kampala Metropolitan Area. On December 16, 2015, then Minister for Works and Transport John Byabagambi and then Chinese Ambassador to Uganda Xhao Yali plus a coterie of officials from China civil engineering and Construction Corporation (CCECC) in a highly televised event signed an MOU for the construction. We should be using the rail line this year. For this, not a single rail has been laid down 4 years later. One could go on with as many examples as possible including the stalled Kampala-Jinja Expressway procurement, the negative returns on investment into the Kampala Northern By-Pass that has been under some form of construction since 2004, a 21km dual carriage highway that astounds everyone as it seems to take a year to construct each kilometre!

Meanwhile, these are all projects that are important in ushering new Uganda’s transformation to a high-income country by 2040, only 20 short years away. The plan, as captured under Uganda Vision 2040 is to have a per capita income of $9,500 and that our economy will be $580.5 billion in size at nominal GDP. The National Planning Authority, as per that document, had envisaged that we shall be only 61 million people. The United Nations Population fund, estimates that we shall be 75 million in 2040. That would give an average income of $7,740 which is still admirable.

How do we get from $853.6 average income per individual per year in 2019/20 to $9,500 or $7,740 in 20 years, when we suffer a negative return on investment in infrastructure because of wastage and poor allocation of resources, low absorption of funds, among others, as found by a World Bank study; Uganda Economic Update; Infrastructure finance deficit: Can public-private Partnerships fill the gap? World Bank, June 2017?

Uganda as noted by the Civil Society Budget Advocacy Group in their 2018 study, Public Debt Investments: How Can Uganda Achieve Higher Returns on Debt Investment, has over $4.5 billion in loans (out of about $12.2 billion in debt) contracted but undisbursed, which leaves a bitter taste in the mouth considering the needs of this economy. The weak institutional mechanism, and lack of inter-agency cooperation and outright fights between agencies for control of projects meant to give this economy the necessary shot to jolt it into life, are galling and abominable to say the least.

Going by the current average nominal GDP growth rate of 6% per year, it follows that Uganda can only achieve lower middle-income status sometime in 2026. In fact, at that rate of growth, we would have an economy of $49.73 billion by 2026. Adjusted for US Dollar inflation at 2.5%, that would be a $59.70 billion economy. UBOS estimates we shall be 49,964,300 Ugandans in 2026 and that would give us an average income of $1,194 per individual per year! Is this a return to be proud of after 40 years of leading a country?

The reason, this may well be, is down to these clearly mind-boggling delays in transformational infrastructural projects. Kampala city has literally wound down to a standstill because it takes 18 months to construct 2km of tarmac (read John Babiiha avenue, Ntinda-Stretcher road, etc), the roads are in such a deplorable state, most failed states such as Syria and Somalia have superior road networks in their bombed-out cities, there is no public transport system to speak of, the existing public transport is both a health and environmental hazard with 90% of head injuries resulting from accidents caused by the ubiquitous Boda Boda riders, and the traffic snarl-ups of mostly 15 to 30-year-old commuter taxis contributing to a worsening air quality comparable to the worst industrial agglomerations in the Far East. The delays on the Kampala-Jinja Expressway, Standard Gauge Railway, failure to approve $250m for 300km (out of 1,600km that need construction- Kampala has 2,100km of road) of Kampala’s roads, outright failure to supervise projects effectively, leading to cost and time overruns, is clearly reason for any sane leadership to pause and think through a new strategy to get their people out of poverty. Unless, as argued in some circles, that leadership actually wants the same people in perpetual poverty, as the evidence looks increasingly pointing to such a  conclusion.

The Ugandan story in 2026, may be entitled, From Third World To Third World: The Story of Uganda, 1986-2020. A very sad thing for every one of us.

Of course, a lot can change over the next 6 years, including gaining traction in the Oil and Gas Sector that has been at stalemate or in low gear since 2006; increased absorption of funds contracted; cracking the whip on corrupt individuals and companies; major shift in talent spotting and placement; change in planning and budgeting methods; adoption of new and democratic infrastructure financing mechanisms that increase the mobilization of savings for investment and domestic direct investment as opposed to foreign direct investment; adoption of expansionary policies that will stimulate demand for locally produced goods thereby spurring an industrial boom; and running a duo-track economy that focused on demand-led efforts that looks at wages as an enabler of growth as opposed to profit-led foreign market targeted growth that looks at wages as a cost.

In the very end, those who look at Singapore for inspiration, if genuine, will be very disappointed that by 2026 and later, 2040, the economy may not be as they envisaged, because they were too important to listen.

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