GOVERNMENT SHOULD STAY OUT OF BUSINESS BUT ….

It seems that Uganda has demystified the concept of economic growth, registering an average of about six percent annual growth since 1990.

What this means is that the economy has doubled twice or quadrupled during the period. Of course this achievement came off a low base – it’s easier to double one shilling than it is to double a million shillings. That notwithstanding there is still a long way to go and given our underutilisation of the human and natural resources available to us the potential is mind boggling.

The major policies that has driven this growth has been government privatisation and liberalisation policies of the 1990s. By first liberating assets from the inefficient private sector to the more profit oriented private sector we have seen their productivity shoot through the roof – when Nile Breweries was returned to the Madvhanis  it was producing 2,500 crates of beer a month and with a workforce to match. Today it has the capacity to produce 2.4 million hectolitres of beer a year which is roughly the equivalent of 16 million crates of beer a month...

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Beer production is not an ideal example but similar gains have been registered in fuel distribution, banking and even electricity distribution.

Liberalisation has also spawned the explosion of telecommunications, education, health and transport services.

There have been other government interventions, not least of all maintaining law and order, that has underpinned the growth of the economy.

"It is all very nice for the economy to grow at a gallop but it means little when these gains are not more equitably distributed among the population. The statistic still stands that up to two in three shillings in economic output (GDP) is generated in Kampala.

Kampala has a daytime population of about two million people, so less than five percent of the population accounts for 70 percent of the economy? That statistic alone is cause for alarm.

"Government does not ensure equitable distribution of economic gains by dishing out money at street corners but by creating an environment where everyone has a fair chance of tapping into the economy and improving their individual lots....

You educate and keep your population healthy as a way to increase their productivity and then you facilitate job creation to absorb the skills of your improved population.

Government did the correct thing to divest itself of the businesses it was involved in, in which it was performing dismally. It has provided a semblance of regulation in the liberalised sectors as well. What seems to be lacking is the government’s ability to direct the economy to generate the desired outcome of decreasing income and wealth inequalities.

An attempt has been made to address this weakness with the creation of the National Planning Authority and the Vision 2040. Next beyond the ministries the government needs effective overarching agencies to drive he dream.

Interestingly we already do have these agencies – to a degree, Uganda Development Bank (UDB), National Social Security Fund (NSSF), Uganda Investment Authority (UIA) and Uganda Development Corporation (UDC) – which was disbanded in the 1990s but is in the process of being revived.

The first two would provide the financing and the last would identify or provide the vehicles to be financed.

UDB is getting back on its feet, despite rear guard action from other institutions, NSSF too is in the midst of a change of leadership but its ability to be at the center of transformation could be hampered by a lack of clarity on how liberalisation of the pension sector may happen (we shall revisit that story soon).

Financing is less than half the story. The question would be how would government deploy the resources at its disposal to keep the economy ticking or vault it to the next level.

Singapore’s Temasek, a kind of sovereign fund, would be a useful benchmark for ourselves. Created in 1974 the company manages a $215b portfolio which was initially seeded by government’s interests in various companies. They serve as a giant investment company, which while driven by profit is also motivated by government’s determination to transform the everyday Singaporean’s life. So among other things they may identify projects with long term benefit to the economy but which are not yet attractive to the private sector, they would attract partners using the strength of their balance sheet and work to open this untested projects...

But to do this effectively they need to be guided by a sound national strategy, run by professionals unencumbered by politicians.

Temasek is a super agency. In Uganda its roles can be carried out by the four aforementioned agencies and therefore a national strategy and aforementioned autonomy will be required to generate similar results.

CONVICTED NURSE IS PROGRESS IN HIV/AIDS FIGHT

Last week Nurse Rose Namubiru was convicted of professional negligence for pricking a baby with a needle she had already pricked herself with. Namibiru is HIV-positive.

For anyone who is a parent this is a story that makes your blood run cold and cuddle in your veins.

I understand that medical practitioners prick themselves all the time in the course of their work, but there is a prescribed practice of what to do afterwards to prevent possible infection to the health worker or/and the patient. By her own admission Namubiru ignored this or forgot to observe these protocals and coupled with her HIV-status set the scene for the landmark case, whose conviction was passed down barely days after parliament passed the HIV Prevention & Control Bill 2010.

The new law provides a legal framework for the prevention and control of HIV, disclosure of sero-status to reduce transmission, provision of testing and counselling services and prescribing criminal penalties for intentional transmission of HIV.

The court passed judgement and there is very little else we can add to the argument.

However as is always in such like cases, the human rights element came up. Activists have been arguing that the arrest, trial and eventual conviction of Namubiru was clear case of discrimination of HIV-positive people in this country.

One can argue that hadn’t she been living with HIV the ensuing drama may not have happened and the whole incident may have been swept under the carpet, as has probably happened in numerous cases before.

It is no consolation to all the concerned parties, but its good events took the course they did because this single case cuts straight to the heart of the professionalism and ethical standards to which we hold our health workers.

The law is useful in maintaining order but more importantly there has to be a fear of social censure, that society will not look on and allow certain behaviour to pass. So for example you wouldn’t help yourself on the road side or walk around naked in public for fear of ridicule and be ostracised. This a more powerful means of controlling public behaviour than all the laws and enforcement agents that can be aligned against outlaws.

Which brings us around to the case by the human rights activists. It is clichéd by now but worth repeating, we exercise our rights and freedoms in as far as they do not infringe on the rights and freedoms of others. Which presupposes that in exercising our rights we should act responsibly.

That Namubiru was the victim of a with-hunt and what she was alleged to have done could be handled administratively by her peers is to dismiss the concerns of the family and the wider society as irrelevant.

In addition these claims deny the breakdown of our medical services, not only in infrastructure and inadequacy of health worker numbers but also in practice.

 One of the outcomes of this case is to put our medical service providers and workers on notice that the days of medical workers doing with us as they please without fear of scrutiny are over. It has also set a benchmark of how such cases of alleged malpractice or negligence can be handled, a useful precedence for society, which if anything advances the rights of the medical practitioners and their patients.

And to that extent the case against Namubiru was not a regression in the country’s pioneering efforts against HIV/AIDS.

In the more than 30 years since the struggle begun there has been a lot of progress, some setbacks but the trajectory has remained forward. We stigamtise the infected less than we do in the 1980s,  testing and counselling services are much more widespread, access to treatment is not only more widely available but cheaper and there is a greater understanding of HIV/AIDS than before. A lot still has to be done in those same areas.

We are looked up as a reference point on AIDS prevention, treatment and even research, especially in the context of a poor country. We are not perfect, but it is safe to say we learn at every turn.

It wold be ideal if progress was made in a straight upward line but that is not how life works.

The Namubiru case was not a cut-and-dried issue of criminal liability. It was bigger than the convicted nurse, the aggrieved parents or the wronged baby. It was a groundbreaking case which furthers the fight against the pandemic going in to the future not only in Uganda but globally as well.

EVEN GOING THROUGH THE MOTIONS CEMENTS GOOD HABITS

Many years ago I learnt with some shock that prefects are subjected to an election in Ugandan schools. That students who presented themselves for various posts were vetted by the staff and the nominees would be put to the vote, including a week of campaigning around the school.

In Kenya then – I am not sure things have changed since, prefects were appointed by the staff. Prior to the announcement

the intending prefects would go around trying to ingratiate themselves with teachers with disgusting displays of obsequiousness that did not stop at carrying ladies hand bags, making unnecessary visits to offices and public shows of obedience that were nauseating to witness....

In theory the Ugandan prefects therefore had it at the back of their minds that they were to represent the interests of the students as well as the best interests of the institution. It took all their intelligence to walk the tight rope between the staff and student body’s demands.

In Kenya of course the prefects were often an extension of the school administration, a less intellectually taxing assignment.

A study to show the relative effectiveness of both systems in maintaining school discipline in the near term and in inculcating a democratic culture in the long term would make for interesting reading.

Which brings us to the by elections in Luwero this week.

By the time of reading this the results must be known and congratulations to whoever was first to the post.

The by election became necessary after the Woman MP Brenda Nabukenya lost a petition against her victory in 2011. In the last several weeks in what was largely a two horse race between DP’s Nabukenya and NRM’s flag bearer Rebecca Nalwanga the ruling party and opposition have thrown everything including the kitchen sink at each other.

(Editor's note, Brenda Nabukenya won the election)

The drama aside it is safe to say that we now expect to vote for our public officials every so often. We saw on TV footage of the election materials being ferried to polling stations and authorities only stopping short of biting their tongues in assuring the public that the process will proceed flawlessly.

One may thumb their nose at the whole process before, during and after the polls have opened but I think it is commendable that we find something amiss if there were no elections.

Elections are only one albeit an important pillar of any democratic process. As a society we need to mature to the point where we go beyond the motions but ensure the rules are followed, elected officials are held accountable and more importantly that people who choose different political affiliations are not ostracised, gagged or mistreated.

In going through the political processes we need to recognise that there will be a day after that we will have to return to our jobs, go to the market and attend church with members of the rival camps, that the elections are not the be-all and end-all of our lives.

We take it for granted but we have come quite some way from 40-, 20- even 10-years ago in appreciating the above facts.

"It is delusional to believe that just because we have a constitution that spells out how we should conduct ourselves that we will immediately sublimate from our previous base instincts to more civil behaviour. It is a work in progress....

What we need to focus on is staying the course, riding the setbacks and capitalising on the gains we have made.

Critics may say we are just going through the motions but that too can cement some good behaviour.

THERE IS A SUCKER BORN EVERY MINUTE

Last week the promoter of Telexfree, Uganda's latest Ponzi scheme, was arrested by police and charged with perpetuating fraud.

According to reports the scammers had roped in hundreds of gullible Ugandans, with one victim claiming he had staked $350,000 (sh910m) in the hope of making up to 20% a month on his money!

Assuming these returns were to materialize it means this hapless victim would have been doubling his money every four months. So if he loaded his account on January 1st by Christmas he would be looking at an account balance of $2.8m -- assuming no withdrawals.

Was this a fantastic deal or was this a fantastic deal? Murphy's law goes that, if something is too good to be true it is (too good to be true).

Also in the same week Professor Augustus Nuwagaba explained in this paper that among other things more people are not emerging from poverty for lack of financial literacy. Financial literacy allows one to not only keep the money they earn but also enables them to make that money work for them.

So if for instance one earns a million shillings a year and saves sh100,000 but can they grow that money by deploying it in profitable endeavors?

In order to get optimal returns for ones money one has to know what is an acceptable return in your context. In the more mature economies single digit returns are laudable, in Uganda by placing money in Treasury bills or bonds one can make up to 12% annually. That should serve as a useful indicator of what is possible or not.

Then one has to be familiar with how the company makes its money, the costs the company incurs, how it creates value and whether their business model is sustainable under competition.

For the life of me I couldn't work out how Telexfree was making money. The theory was that they would place a number of ads on a website and they would get paid. I guess the thinking was that they would be paid per click. But the clicks can't be constant every month so how could the promoters guarantee a constant return? And why would someone else need other people to do it for him and share the profit, why not hire a few dozen eager kids to do it instead and pocket more of the profit? one of the red flags of these scams Is there are often people willing to share in their good fortune out of the goodness of their hearts!

But on the other hand this kind of gullibility is not an inherent flaw in our psychs as Ugandans. It is part of the human condition that we will always be susceptible to making easy money,  partly because making genuine money takes time and discipline.

As human beings Our minds are wired to simplify the bigger picture. To find shortcuts to an intended objective. So we read that so-and-so makes a few millions from his real estate business and our conclusion is that he is lucky, that is easy money. We however are seeing the finished product. We don't explore the work that they put in, the frequent trips to the site, the sleepless nights spent wondering whether they would meet loan obligations and the months even years of forgoing good cloths, a new car or more trips abroad to build the business.

But more importantly we think making money is about what we do, but the best of them know its more about how they think more than what they do that makes he difference between being financially secure or blowing up their money.

So for example whereas us mere mortals place a high premium on cash, the genuine

rich man is keen to convert the money as it comes in into incoming generating assets. They are willing to forgo the fat bank account today for a stronger asset base that will keep throwing off cash well into the future. Making money work for them.

Not to kick a man while he is down, but our man -- its invariably men who are hit in these high risk high return scams, who put down nearly a billion shillings on Telexfree clearly does not have the mentality of a rich man, which begs the question, how did he make the money in the first place?

CRIMINALIZING HIV TRANSMISSION COUNTERPRODUCTIVE

The passing into Law last week of the HIV Prevention & Control Bill 2010 while trying to control the HIV pandemic may fuel instead of stall the spread of the virus.

The promoters of bill sought to create a legal framework for the prevention and control of HIV, disclosure of sero-status to reduce transmission, provision of testing and counseling services and prescribing penalties for intentional transmission of HIV.

On the surface of it the motives behind the bill are noble even laudable but we know that even the road to hell is paved with good intentions.

One sees this bill as knee jerk reaction to the recent increases in HIV prevalence after the country had for many years registered consistent success in slowing the rate of new infections.

Two of the most controversial clauses criminalize the transmission of HIV. Clause 39 seeks to penalize anyone who "attempts to transmit HIV" to another person to a fine or/and upto five years behind bars, while clause 41 goes after people who "willfully and intentionally transmit HIV" to a fine or/and imprisonment of up to 10 years.

The major danger with this is that it stigmatizes pele with the virus, a throw back to the early days of the pandemic when, driven by fear, societies were most likely to deny the existence of the challenge at best or ostracize victims entirely.

Uganda, hobbled by a lack of resources in the 1980s determined that the best thing was to be open about the problem even though it might have affected the economy in lost earnings from tourism for example. The net out come was that Uganda came to grips with the pandemic long before our more conservative neighbours allowing us to roll back its deadly advance.

Once resources were available widespread testing for HIV helped in helping people access treatment and alter their behavior.

In determining that a criminal act has been committed this new law presupposes that the one trying to infect knows their HIV-status or at least that the law will be more punitive if it can be proved that one knew they were carrying the virus and indulged in risky sexual behavior.

This might have the effect on discouraging people for going for testing in an effort to prevent from future liability under this law.

If this is the outcome it would be a significant step backward in the war against AIDS. It has been an uphill task to get people to voluntarily present themselves for testing the last thing we need is for that momentum to be slowed or reversed altogether.

One can understand the desire to criminalize transmission of the virus than say transmitting Other sexually transmitted infections or cholera or Ebola. In sub- Saharan Africa nine in ten infections are through sexual intercourse, it therefore threatens our need to procreate and also probably the only source of pleasure for the majority of people, dare I say.

But we know that not all people carrying the virus contracted it through immoral behavior and so deserve their fate, as the hypocritical moralists among us maintain. Some are children, victims of sexual violence or contracted it through blood transfusion. But closer to home, women who are largely not in control of their sexuality may fall victim to this because all pregnant women are tested for the virus and their significant others may accuse them of infecting them, as the technology to know who infected who has not been developed.

It does not help that HIV transmission has been criminalizes in the west so the opposition to these kind of laws sound like voices in the wilderness.

Advances in HIV research mean that infection is no longer a death sentence, with life expectancy of victims now up to as high as 75. But in order for those infected to be treated effectively they need to test as soon as possible. Stigmatizing them only makes this that more difficult.

Clearly fear is driving this kind of legislation. The only way to combat fear is through knowledge, as the successful campaign against the epidemic showed in the 1980s. This is not an abstract concept to us in Uganda we know this through hard experience. 

It sounds counter intuitive but knowledge rather than punitive measures are definitely where the continued gains against HIV will be made.