Another year has come and gone – don’t they seem to be
passing by faster and faster these days?
Looking over the 40-odd Shillings & Cents column that
have gone out during the year I dug up a few thoughts that would serve us well
in the New Year and well in to the future. Below I excerpt some of these
columns and the thoughts that should serve us well in the New Year.
1. On Wealth inequalities …
At the beginning of the year UK based NGO Oxfam led by
Winnie Byanyima, put out a damning report showing how world income and wealth
inequalities were growing to unsustainable levels. The report pointed out that
in a few years’ time one percent of the world’s population will own more than
the rest of us combined.
Oxfam suggested that we break up the powerful interest
groups that maintain the status quo.
Our suggestion?
“At the end of the day, the wider the wealth disparities are in a county is how inefficient the government is in creating wealth, through the encouragement of business on the one hand and redistributing this wealth through the building of infrastructure and improvement of the quality of the human resource...
2.
On government interventions in the
market ….
In January the Swiss central bank had
to give up trying to hold the Franc to a certain level against the Euro. A
combination of factors that included uncertainity in the Euro zone due to the
real possibility of Greece exiting and events in Russia which saw inflows to
buy the safe haven currency, meant the peg was impossible to sustain. The Swiss
spent $200b defending it over three years once again showing the following of
trying to bet against the market for anyone even the most solid economies.
We wrote,
“The Swiss have
suffered the very same fate they were trying to avoid. Their exports now will
cost consumers up to 20% more than last week, which may not be good for sales. It’s never a good idea to bet against the
market, even if you believe the market is wrong. As they say the market can
remain irrational longer than you can remain liquid....
3.
On unlocking our wealth …
In April we
marvelled at the progress Umeme had made in a decade. The distribution wing of the former UEB was
passed off to private investors and by one metric alone had more than doubles
subscribers to the grid to 600,000 during the period, a feat which took the
original owners more than 40 years.
What made the
difference?, “To get an optimal
return or result one has to focus on three broad areas the quality of human
resource, making operations increasingly efficient and having an effective
strategic processes...
4.
On the rise of the Ugandan manager ….
Allen Kagina took
over at the Uganda National Road Authority (UNRA) in May for which we said,
“But beyond her potential impact at UNRA and her
wellworn record at URA, Kagina is a front runner in a new crop of parastatal
manager that is debunking the notion that we lack effective managers among our
number to run our most prized assets.”
And added,
“And finally Kagina’s recognition as a top manager
but just importantly, as a woman manager, signals the acceptance of women as
managers able of taking on the “tough” assignments society had decided belonged
to men.”
Enough said.
5. On fallen heroes ….
In May we lost Ivan Kyayonka long
time boss at Shell and chairman of various boards. The loss of life is always
tragic but Kyayonka’s loss will be particularly telling.
"It is men like Kyayonka, sadly in short supply, who are badly needed to populate, our management suites, our public service and even lead our schools, so that we generate more of his kind to unlock the vast potential of our country. Because people are what make things happen and not the other way around...
6.
On how far we have come …
In June in a
post-budget column, we reflected on how far we had comes as an economy. WE
noted that in the 1986/87 budget government set out to spend $785m or about
sh2.4 trillion at current prices which was a tenth of this year’s budget. We
said the biggest contributor to this jump in revenues was the liberalisation of
the economy and the privatisation of public companies.
However, we thought,
“"But whereas we have done a
better than average job at rehabilitating our physical infrastructure, there is
an urgent need now to get our soft infrastructure – laws and
institutions, to work for the benefit of the private individual and private
sector.”
7.
On shopping malls …
Prompted by a
typhoid outbreak in one of better known malls down town we wondered at the
folly of the mushrooming new malls.
"It seems to be, that the sum
total of our market research before we go into business, is to look around at
what other people are doing and join the bandwagon,” going on to speculate that
the money behind these malls maybe hot money looking for refuge. Only time will
tell.
8.
On the legacy of the Idi Amin era ….
We were perturbed
by attempts to revise history -- particularly of the eight years when Idi Amin
held sway of our country, out of ignorance or out of a deep seated hatred for
the current government.
“But the more you examine the period you realise that the breakdown in physical infrastructure was not the worst legacy of the era. The real tragedy was the break down in the spirit of a once proud people and the missed opportunities for development that cannot be recovered...
And we added,
"We celebrate the cronies of the state who
businesses were dished to in 1971, but if you look for where they are now, you
would be hard pressed to find a handful who parlayed those assets and the
passing of the last 45 years into sizeable business with at least a national
presence, live alone regional presence.”
9. And finally we were at a loss to understand the
justification for the white elephant that will envitably be the Kiira Motor
Corporation,
"As a country we have neither
the comparative advantage -- that we can make cars better than any other
product, nor the competitive advantage -- that we can make cars better than
other people, which is a red flag for the enterprise. Both conditions are not
insurmountable but at great cost and without guarantee of success.”
There was more
throughout the year but these were probably the choicest subjects.
Have a Happy New
Year, people!
