LET US NOT REINVENT THE WHEEL OF DEVELOPMENT

BOOK: HOW ASIA WORKS: SUCCESS AND FAILURE IN THE WORLD’S MOST DYNAMIC REGION

AURTHOR: JOE STUDWELL

PP: 402

We hear a lot about the Asian tigers and the development miracle that took place in that part of the world over the second half of the last century.  We hear stories how about almost all Asian nations were at the same level as sub-saharan Africa 50 years ago. The divergent paths of their economies with Asia becoming more and more prosperous and sophisticated while sub-saharan Africa descended into chaos and poverty serve as a useful study of what to do or not to do to drive development.

In this book Studwell, a long time financial journalist in Asia, distils the path to the region’s prosperity down to the jumping in agricultural yields, export driven manufacturing and the directing of financial resources to those two goals.

But first he debunked previous theories about the Asians being congenitally frugal or disciplined people as the basis of their superlative success. In doing so he makes the distinction between Japan, South Korea and Taiwan on the one hand and Malaysia, Thailand and Indonesia on the other. The former being the success stories – The Asian Tigers, while the latter, while having experienced growth have fallen far short of the other three as far as being development models is concerned.

"At the base of their – Asian Tigers,  launches were land reforms, which were successful to varying degrees and served as a signal of the respective political classes’ commitment to long term, equitable development...

Once land reform was done the “gardenisation” of Asia begun in earnest. This was the process of increasing the farm yields, which had several advantages for the underdeveloped nations. One, it was labour intensive creating employment. Two, the improved food yields saved the country valuable foreign currency that would have been spent on food importation and relatedly it created demand for the budding industries which served as the bedrock of these countries next level of development.

The Tigers then pushed into manufacturing, but did not succumb to the seduction of import substitution industries. They developed an industrial policy that emphasised export discipline. Import substitution just promotes inefficiency and entrenched local interest that are not competitive abroad. In their drive to build their manufacturing base they not only supported only companies that were producing for export but also supported several companies in the same industry. This created competition as they favoured these that succeeded in export markets and shut down or merged the unsuccessful ones with the successful companies.

Contrary to popular belief they did not attempt to pick winners but more the policy served to cull inefficient producers. Failure or success was determined by the objective tastes of foreign markets.

And finally they directed financing strategically towards boosting agriculture production and supporting firms to prosper abroad. In the case of Japan and Taiwan through a determined effort to build their internal savings but in South Korea’s case by borrowing abroad.

Studwell also points out that it does not matter much if the banks are state owned banks as in the case of Taiwan and now China or are in private hands as in the case of Japan and South Korea. What matters is whether they are persuaded to support the government’s development agenda.

"This was an interesting finding that stretched to companies as well. That it did not matter whether they were state owned or privately owned but whether they could be compelled to support the development agenda...

One other interesting finding, a distinction between the Asian Tigers and such basket cases as Philippines is that their development agenda were driven by “historians” rather than economists. Technocrats who had studied the process of development in Germany, England and even the US and adopted to their local circumstances rather than kowtowing to liberal economic theorists whose prescriptions had little precedent – and still don’t, to back them up as successful developmental models.

Compelling, hard to refute  case is made for differing economic models at the different stages of development countries have to go through.

The books cuts to the heart of the many developmental questions we are currently grappling with. How do we drive growth? How do we make it more equitable? Which economic forces should the government be aligned with? How can agriculture be supported? And why economic orthodoxy is bound to fail all the time and is the wrong prescription for developing economies?

It is a book on a complicated subject that is written simply enough for anybody to understand.  A priceless handbook, worth its weight in gold and which everybody who is interested in the development questions of our time should, No! Must read.

ANDREW KAWEESI AND THE TRAGEDY OF OUR WASTEFULNESS

Last week Assistant Inspector General of Police Andrew Kawesi was mowed down in cold blood outside his home by motor bike riding assassins.

Kawesi, who had only made 43 in January, was the rising stars in the police, the head of a new generation of leadership in the force.

"His loss is a tragedy not only because of the nature of his death and because he died young and because he had a young family and because he held so much promise, but also because his career was a gamble that did not pay off...

A gamble because a lot was invested in him in anticipation of big things ahead, dreams that were ripped apart in a hail of gunfire that shattered last Friday morning’s pre-weekend routine.

In the last few millions of years that life has existed on this planet, nature has found a way to continue. Floods, earth quakes, plagues, genocide, slavery, colonialism and any number of natural or manmade disasters have come along and done their worst but life, like hope, always springs eternal.

This would not have been possible if nature had placed its bets for survival on a handful of species. 

Don’t have one specii of ants or animals or plants have hundreds, thousands even millions. And when the threats to survival show their heads, as they do every so often, the fittest will survive give birth to an even fitter specii. But even then mutations occur within the specii ensuring that when the next disaster comes around some will survive. The basis for Darwinian natural selection.

This process is going on every day, every hour and every second at all levels of life.

Nature understands, to the extent that there exists a universal conscience, that survival is a numbers game.

When we joined university more than 20 years ago they said that of all the kids we joined primary school with only 0.2 percent of us had made it to Makerere University.

Now there has been a dramatic increase in university in enrollment – we were on 2000 who made it to university in our day but now total university enrolment is upwards of 50,000 annually.

It is true that the cream always rises to the top. It is also true that the more milk you have the more cream there is to rise to the top.

The challenge for us as a nation is that we are way behind the curve not only in our infrastructure and savings but most especially in our human resource.

"A study reported in The Economist about two years ago showed that between human resource and infrastructure development, emphasis should be placed on human resource development. The thinking being that quality individuals in an environment of inadequate infrastructure will find a way to either transcend the problem or bridge it anyway. The opposite – good infrastructure with poor human resource, is an almost unsalvageable situation...

In a situation where there are only a few stars, it only serves to inflate the egos of the stars but does little for the general population.

That Kawesi – as he has been described variously, was the one officer who stood out is testament to his application and diligence, but is also an indictment on the ability of the police force to recruit and retrain talent.

And Ugandan society as whole. The police is not the only institution like this.

As a society we need to first recognise and then appreciate that our people are our biggest resource, which can be leveraged as a force for good or weigh us down.

Maybe because we have high birth rates we treat the population as an infinite resource. We need to change that, urgently.

Let Kawesi ‘s passing serve as an eye opener, a call to action to look out our human resource development as a nation if we are not to be held to ransom by every two-bit terrorist.

KENYA LENDING RATES CAP, LESSONS FOR UGANDA

Last week Kenyan banking giant Equity Bank released their results, which showed a drop in profitability due largely to increased provisioning for bad loans and a contraction of their loan book.

In 2016 net profit slid 4.1 percent to Kshs16.6b from Kshs17.3b the previous year mainly due to a loan provisioning that jumped almost three fold. Meanwhile the loan book also shrunk 1.4 percent.

The increased incidents of bad loans maybe due to a general slowing down in the economy but the reduction in their loan book was due mainly to a law, capping lending rates passed late last year.

Under the law bank lending rates were capped at four percentage points above the Central Bank Rate (CBR). So at the time of enacting the law the CBR was at 10.5 percent so banks can not lend at a rate higher than 14.5 percent.

"This was a classic case of political expediency trumping good economic sense. If the government – the safest debtor around, is borrowing from the public at more than 10 percent how can a bank account for costs and margin within such a narrow range?...

So what banks have done in Kenya, they are in the process of winding back on their lending to all but the biggest SMEs, the most prime corporates and the government. It would be foolhardy to do otherwise.

The effect on the economy will be an inevitable slow down, as businesses have to cut back on their operations, because they cannot sustain them or scale up, on one hand and because the demand in the market has fallen off, as people have less cash on hand.

If a country wants to cut its lending rates, without subverting the laws of supply and demand, it can do two things; reduce the government’s cost of borrowing, since all lending is pegged to that and secondly, raise its level of saving.

Banks make their money by lending. Money seating in the vaults is a cost. With too much savings and wanting to minimise their costs, they will be forced to lower their lending rates and ship out the money.

Political pronouncements are just playing to the gallery. Expectations are that after the August elections in Kenya, there will be a move to reverse the law.

On the other hand despite the clumsiness of the Kenyan MPs, they were responding to a genuine frustration with the banking sector that we can relate to in Uganda.

On a micro level that lending rates are too high despite the fact that inflation is largely under control and interest on deposits are low.

As if that is not enough when everybody else is struggling with the economy, banks seem to enjoy a continuous purple patch.

"High lending rates are a symptom of larger problems, not least of all that there is little to no effort, to direct lending towards the productive sectors and away from consumption...

If bank lending was directed towards agriculture and manufacturing rather than towards personal loans and real estate speculation, incomes would rise more evenly across the economy, raise saving rates and drop lending rates.

In Japan, South Korea, Taiwan and now China banks were “incentivised” to lend to agriculture and manufacturing.

In agriculture this has meant that these countries are largely food sufficient. This means they save precious hard currency they would have used in importing food but also raise rural incomes which provide the initial demand for manufactured goods, serving as a bed rock on which those respective countries industrialisation was based.

In manufacturing preferential credit was extended to the exporting companies at rates which would allow them to be competitive abroad.

Interestingly when many of these manufactures could break away from government oversight – the beneficiaries of the credit were those who supported government industrial policy, they went to the open market to raise cash by listing or offering bonds deepening their financial markets. A kind of unintended consequence.

"The reason why such policies would be unpopular in the region is because one, they would mean
lower margins for banks and secondly, it would mean even higher borrowing rates for consumption, as more and more money is shovelled at infrastructure, manufacturing and agriculture, which may become politically uncomfortable...

But one day somebody is going to have to bite the bullet. Take the political risk to ignore possible push back from the urban elite, who gouge on cheap credit to fund merrymaking and speculation.

Such a shift in policy will give the rural farmers a chance to raise their incomes, create jobs in manufacturing, boost exports and speed up the attainment of a more equitable middle income nation status. Not one where most of the resources are controlled by a minority of the population while the majority live as second class citizens.

READING, MORE THAN AN OVEREMPHASIZED PLEASURE

Wednesday was the fifth celebration of Drop Everything And Read (DEAR) day. Commemorated on the third Wednesday of March, the day was launched in Uganda in 2013, a collaboration between the education ministry and the US Peace Corps as a way to promote reading culture and a love for learning.

At 11 am on the day people were encouraged to put down whatever they were doing to read for 20 minutes.

"One organiser was almost apologetic in asking people to read for 20 minutes, making the concession that if people couldn’t handle 20 minutes they should at least do five minutes!...

Some regular readers did not even try because if they sunk their teeth into a good read, 20 minutes just wouldn’t do and they may be tempted to extend their reading at the cost of their regular jobs.

There are numerous benefits to reading – it improves concentration, creativity, vocabulary, memory and analytical skills among many others.

Seven in every ten Ugandans above the age of ten is literate. For a third world country like our own literacy is not enough. We need more and more people reading, and not only road signs and office reports.

In his book, “Hive Mind: How your nation’s IQ matters somuch more” author Jones Garret, makes the point that one would rather be of average intelligence in a high intelligence environment or country than be of high intelligence in a country with a generally low intelligence. He used the standard IQ test to measure intelligence.

"High average intelligence nations not only create a bigger pie for everybody but by extension carry everyone along, the opposite – high intelligence in a low intelligence environment, does not help the sole genius or the dull masses....

He showed that above intelligence nations have, “the cognitive skills, the human capital, to take on the complexity of a modern economy.”

If you drill down further on an individual level, you are richer or poorer than the next man because you know something or you don’t know something they know. This knowledge can come from experience or much quicker through study – formally or informally. This knowledge is the value that the market pays for.

The Jews known for their financial savvy, it is said their houses are not complete without a library, oftentimes built over generations. Isn’t it the great author who said, “There is nothing new under the sun”?

Studies suggest that people read because they see their parents, significant others or their peers reading.

Unfortunately anecdotal evidence suggests that we are reading less and less and the youth are not taking up reading, beyond their school notes.

But can they be blamed? Their parents and significant others are rarely seen with a book in hand and they have no libraries in their homes, not even for show.

We are distracted by our phones, 24-hour television and the proliferation of entertainment spots around us. The electronic media are not unlike fast food -- they require little if any powers of concentration, abbreviate storylines, employ gratuitous violence and sex to keep the consumer’s attention. Creating a false impression about everything from the process of success to the meaning of relationships.

"We are neither building our individual knowledge base nor that of the country and if author Jones Garret is to be believed, is it any wonder that we continue to be a poor nation decades after independence?...

Before anything happens there has to be a thought, a desire, an intention. From the intangible comes the tangible. From the mental, spiritual comes the physical.

It follows doesn’t it then, that the quality of an outcome depends on the quality of the input? Garbage in, garbage out.

Clearly we are putting a ceiling on our potential by failing to feed our minds through reading. And this need not be non-fiction reading as fiction reading does a lot to stimulate creativity, analysis and comprehension, vital skills in a fast changing world.

If you have read this up to this point I am preaching to the converted. To help the uninitiated it would help to start walking around with a book --- even if it is for show!

MY FAVOURITE BUSINESSMAN

It is the stuff of legend.

The story goes that on Saturday’s Charles Lubega would mount his speakers on his window which faced into the quadrangle at Livingstone Hall and set his player to play. He would then climb down the stairs basin and clothes in hand to do his laundry as he listened.

After not so long Saturday morning at “Stone” was a heaving mass of activity as other students stopped by to sample Charlie’s latest hits.

As his popularity grew he set up at the Guild Canteen, playing on Friday’s, Saturdays and sometimes due to public demand, on Sundays as well.

He did not stop there. Buying an additional set of machines to open his mobile disco. No party was with it, without the sound of Soul.

And then Patrick Bitature, wanted out of Ange Noir. And the rest as they say is history.

This is more than a quarter century ago, but Ange Noir – now Guvnor, still lives on, dominating Kampala’s night life, after all comers have come and gone.

This is not gospel truth, Charlie just does not tell his own story. But we shall not let the facts get in the way of a good story.

"Entering a market that was almost non-existent, raising standards incrementally, building the barriers to entry unilaterally, to the point now that there are many revelers who will not settle for less, at home or abroad...

Ange Noir has not only maintained a loyal crowd from the 1990s but has added subsequent generations of merrymakers and all without being tempted into race-to-the-bottom marketing gimmicks. This has ensured that standards have remained high – be it in the quality of the playlists, the ambiance or service.

So popular is the industrial area hangout that attempts to create some price discrimination and stratify the clientele by pocket size have fallen flat.

For a long time he has been my favourite businessman, but more and more I am liking what Lawrence Mulindwa is doing off Entebbe road.

Mulindwa last week unveiled a new coach, Portuguese Jorge Miguel Da Costa Duarte for his Vipers Football Club.  This came fast on the heels of an announcement of a sh500m Roofings Ltd sponsorship deal. Only days before his brand new 20,000 seater stadium at Kitende was cleared by the sport's African football authority, CAF, to host continental matches.

But what we are seeing is the finished product, or at least the rough outline of not only a great sporting establishment but a first class business too.

Initially there was the school St Mary’s Kitende, which has not only taken over domination of school soccer from Kibuli and Old Kampala, but has gone on to dominate the East African regional school competitions as well.

But he didn’t stop there, buying and converting stragglers Bunamwaya FC into Vipers FC as a preliminary destination for his school talent to settle.

"The last part has already paid dividends as at least a dozen players are already plying their trade abroad, with the most prominent of them being Farouk Miya, Lwanga Kizito and Yunus Sentamu who are playing professional football in Europe...

The stadium, the biggest stadium built in this country in 20 years, is just icing on the cake.

In a sporting business the main asset class is the intangible assets, where players would lie. 

Manchester United in 2016 reported total assets of about $1.95b of which intangible assets accounted for about half the total assets at about $900m. Fixed assets which include Old Trafford, the stadium, came in at about $300m

Looking at the whole Mulindwa operation from this perspective, he not only has a top team but has a rich pipeline of talent coming through from his school, which for all intents and purposes is the equivalent of a soccer academy in the Europe.

The beauty of this is that not only are the players developed from an early age, but when they are sold off the sell price is almost all profit.

Of course, there is a lot of work to do moving the operation away from one driven by its founder and chief backer, to a fully-fledged corporate organisation, which hopefully will outlive Mulindwa.

The lessons from my two favourite businessmen are many but a few stand out.

One, think long term. Don’t clamour for the quick gains. Be willing to forgo the good for the better and be willing to do the time and put in the work.  And relatedly don’t be content to being a big fish in our little, small pond. A few million shillings is plenty in Uganda, but with a million-dollar or even billion-dollar vision will make a world of difference. A business can only grow as big as its promoters dream, the bigger the dream the bigger the company.

"These heroes are important if only because when everyone is hemming and hawing, whining how it is difficult to make it in Uganda, they are keeping their noses to the grinding stone and showing how it can be done. In the process serving as inspiration for hundreds of thousands of businessmen in urgent need of local champions...

Charlie remains atop the Busharizi honours list, but only just.

IT’S A DISASTER THAT WE DON’T WRITE

In the last month we have had three of our eminent citizens go to meet their maker.

Last month two businessmen Heny Bugembe Luggya and Bonny Katatumba and this month elder statesman Jehoash Mayanja Nkangi passed on.

Of the three only Katatumba published a biography of his life, an inspiring narration of how he rose from selling banana juice to becoming a billionaire and diplomat.

That Luggya and Mayanja Nkangi did not put pen to paper about their lives makes it a double loss for us and generations to come.

In his book “Guns, Germs and Steel” author Jared Diamond attempts to explain why the north -- Europe and America is rich and south – Africa, is poor. He lists several factors – orientation of the continents, the agrarian revolution and the domestication of animals among others. But the one relevant for us is the development of writing.

"With the development of writing events could be transmitted across time and distance accurately and effectively. This was a revelation because it meant that the communities with reading and writing skills need not reinvent the wheel every time they came across transportation challenges....

Isaac Newton is supposed to have famously said “If I have seen further it is by standing upon the shoulders of giants” His coming up with the laws of motion that laid the foundation for mechanics with near universal application in everything from cars to aviation and electricity generation.

He built on the works of Nicolas Copernicus, A polish mathematician who first pointed out that the sun, not the earth, was at the center of the universe, Italian Galileo Galilei the “father of scientific method” and Johannes Kepler, German mathematician who did work on planetary motion.

These three were not only not contemporaries but also came from different nations. Europe is now easy to traverse by road, rail or sea but in Newton’s time England was as far away from Italy as maybe New Zealand is to Newton’s old haunts at Cambridge today.

But since his predecessors had a written record of their work Newton could continue from where they left off. This applies to any subject’s development that you can think of.

Our elders who are going to their graves without writing out of humility or even ignorance, may think their experiences does not amount to much but if enough of them wrote at the bare minimum we would benefit from a history that is multisourced and an eventual true account of history.

Unfortunately it is not a situation unique to Uganda and is probably at the heart of the question of why the western economies get richer while we the poor southern economies continue to flounder, lurching from crisis to crisis and failing to make significant progress.

According to a report by the United Nations Education, Science & Cultural Organisation (UNESCO) African countries at the bottom of the list of books published annually which is topped by China, US, UK and Russia. The highest ranked African county is Egypt at 38, then South Africa (45), Nigeria (63) and Morocco (68).

Another list reported in The Guardian newspaper in 2014 tallying books published per million in 2013 had the UK at the top followed by Slovenia, Australia and the US.

"The point is that even though literacy levels are near universal now in many of our countries we use them for little else than to pass exams and get around. We still fall back on our oral traditions, see how we have the highest rates of voice phone usage of any region in the world...

It is essential, even critical for our very survival as a people, that we document our doings and save them for posterity.

That it is a bad omen to write your memoirs or autobiography should be dispelled.

Many years ago an older man narrated to me the changing motivations that drove him threw his life.

At first he wanted to go to school to become a primary school teacher, because he worked out that it was primary school teachers who could own bicycles. Then he thought he needed to read some more, pass his o-level because then he could work in an office at the district headquarters and drive a car. 

Eventually he studied the natural sciences because he wanted to do forensic science and become a detective like Sherlock Holmes.

His story has also gone begging. But in that simple narration he would have given millions of boys and girls inspiration to push on, deriving courage from the small steps they make every day that they may also lead to bigger things in life.

And by extension as a nation if we are going to move to the next level of development we need for our people to document their lives – it is much easier now with the ICT tools available to all of us.

CORPORATE UGANDA NEEDS TO READ UP ON WARREN BUFFETT

US billionaire Warren Buffett last week released the annual report of his company Berkshire Hathaway.

Beyond the big numbers – net earnings were down marginally to $24.07b from $24.08b in 2015 and the announcement that his company has $86b in cash and near cash stored up, his annual letter to his shareholders always makes for good reading as it lays out his thoughts on business, corporate governance and investing.

This year he wrote about his confidence in the US economy’s prospects and about his more than half a century investment philosophy.

For the uninitiated Buffett is the world’s richest investor having built his wealth over the last 70-odd years threw shrewd investments in everything from insurance, manufacturing, media, consumer goods, energy and railways.

He has led his company Berkshire Hathaway for the last 51 years. He has almost all his $76b of net worth in the company. He built the company from a failed textile mill into a conglomerate now valued at about $440b through a series of equity investments and outright company purchases.

His stellar record as an investor – his company value has sky rocketed about 9,000-fold over the last half century, his having come out not only unscathed but stronger from every major financial crisis of the last half of the 20^th century means that when he speaks everyone, who is anyone listens.

"Corporate Uganda is currently suffering through a trying economic environment. Falling revenues, thinning margins and unrelenting competition from regional and international competition are making for many sleepless nights...

Buffett’s thoughts on the economics of business are insightful and well delivered but where he really stands out is on his emphasis on corporate governance as grower of company value is what sets him apart from many.

He thinks it all begins with company culture.

“Cultures self-propagate …. Bureaucratic procedures beget more bureaucracy, and imperial corporate palaces induce imperious behaviour. … As long as Charlie (Munger, vice-chairman) and I treat your money as if it were our own, Berkshire’s managers are likely to be careful with it as well.

“Our compensation programs, our annual meeting and even our annual reports are all designed with an eye to reinforcing the Berkshire culture, and making it one that will repel and expel managers of a different bent. This culture grows stronger every year, and it will remain intact long after Charlie and I have left the scene.”

Isn’t the challenge these days that many managers or employees don’t see the company’s fortunes as tied to their own? That what is good for the company is good for them? That the attitude seems not to be about building legacy but plundering the company as fast as possible, hopefully before they get caught?

And Buffett recognises that beyond culture the next filter for improved corporate governance is in the recruitment process.

“In looking for people to hire, look for three qualities – integrity, intelligence and energy. And if they don’t have the first, the other two will kill you...”

Enough said.

As a logical follow-on he puts a high premium on reputation – his own and his company’s.

“The priority is that all of us continue to guard Berkshire’s reputation. We can’t be perfect but we can try to be. As I’ve said in these memos for more than 25 years: “We can afford to lose money – even a lot of money. But we can’t afford to lose reputation – even a shred of reputation.” We must continue to measure every act against not only what is legal but also what we would be happy to have written about on the front page of a national newspaper in an article written by an unfriendly but intelligent reporter.”

And he doesn’t stop there.

“Sometimes your associates will say “everybody else is doing it.”… It is totally unacceptable when evaluating a moral decision. Whenever somebody offers that phrase as rationale, in effect they are saying that they can’t come up with a good reason. If anyone gives this explanation, tell them to try using it with a reporter or a judge and see how far it gets them.”

And finally he argues that companies may get away with poor corporate governance but the day of reckoning is never far behind.

“When the tide goes out you will know who has been swimming naked...

When the economy is in good shape everyone looks like a fantastic business manager. But the boys will be separated from the men in hard times, with those coming out the other end being those who have beefed up their systems, managed their costs and have enough built in buffers to weather the storm.

Buffett has been writing and speaking for more than a generation. The Chinese say that if you want to climb a mountain study all the possible routes and then ask someone who has been there.

Corporate Uganda would be doing itself a big favour if it read up on Warren Buffett aka the Oracle of Omaha.

THE EALA CAMPAIGNS SHOW THERE IS HOPE FOR UGANDA YET

The just concluded east African Legislative Assembly (EALA) final campaigns made for interesting television but on a much broader level suggested there is still hope for Uganda yet.

On Tuesday the EALA nominees made their last pitch to an animated parliament. MPs caught up in the occasion were chanting, cheering and heckling in equal measure and one couldn’t help feeling they were glad, gleeful even relieved to be on the giving rather than of the receiving end of the attentions they endure during their own campaigns.

It begun with the NRM nominations. As is now normal with NRM contests they were spirited and just only managing not to tip over in to nastiness and chaos.

For we on the sidelines we wondered what was all the fuss about. The East African parliament seats hundreds of kilometres in Arusha, Tanzania and while their deliberations have far reaching consequences for the rest of us mere mortals, they get so little coverage as to be literally ignored.

Of course the chief benefit is financial.

On the one hand members of EALA do not have to suffer the unwanted demands of their constituents and on the other hand by whatever measure you use these members can look forward to fat paychecks.

"According to reports the legislators can expect about $15,000 monthly (sh54m) in basic salary and allowances...

This is a lot of money.

But interestingly our brightest minds or most prominent businessmen showed little interest in putting themselves up for election to EALA.

In the late 1980s some really quality people put themselves up for election, suffering the ignominy of people lining up or not behind them up the levels of the political process to get a chance to get to the legislature.

One can argue after many years of being shut of the political process by shrewder operators and eventually the army, the elite of Uganda saw this as a chance to contribute to the country’s progress through politics.

However one has to remember that paychecks all around were wanting, while the consistent pay and easy living of government officials were there for all to see. In a depressed economy where the civil servant was the biggest working class and the parliamentarians were not grappling with consistent payouts one can see how politics was a credible enough meal ticket.

Fast forward to the present and the employment options are such that the best and brightest would rather take less pay than join the rough and tumble of politics.

Looking down the list of nominees to EALA it was safe to say the productive sectors of Uganda will not miss any of them.

This is good.

"If a society’s incentives are slanted towards public administration and not the productive sectors – agriculture, manufacturing and services; If the brightest minds highest ambitions are to work in the public service; if our brightest and sharpest are forgoing the meritocracy of the private sector for less in the public sector, then as an economy you know you are in trouble...

This can happen if the private sector is on its knees and therefore the economy is in dire straits or if the government is the only game in town, as in the days of communism, which means the economy is in the toilet anyway.

To everyone their own.

It therefore makes sense that for politicians to protect their tough they need to keep the economy ticking along so business can flourish and employ more and more people and even if MPs increase their pay the attraction will be limited for other potential, but otherwise gainfully employed people.

The Uganda economy has a long way to go – we are still not a middle income economy, but as an indicator of how far we have come, the EALA campaigns showed that there is still hope for this country.