CHEAP POWER IS GOOD BUT ….

In The New Vision recently PhD Candidate Jessica Kersey, while noting the achievements made in the electricity sector since the 1999 reforms, however pointed out that higher tariffs in the sector had put electricity usage out of the reach of many in society.

First a recap. Previously there was Uganda Electricity Board (UEB) which did everything from generation to transmission and eventually distribution of power.  The unbundling and privatization of UEB was based on the fact that more investment, to the tune of billions of dollars, was required to raise the sector to a meaningful level of generation and distribution. Money the government did not have.

"The unbundling of electricity giant was to make it easier to attract investment and foster specialization and hopefully more efficiency up and down the value chain....

About $5b (sh18.5trillion) has been invested in the sector since 2000 with the building of Bujagali, Isimba and Karuma dams counting for more than $3b between them. Umeme has since the beginning of its concessioning 2005 invested about a billion dollars in the grid.

While more could have been done this aim of attracting more investment into the sector has come through. The investment means more people have access to power to day than at the beginning of the century.

As an indicator Umeme has seen account numbers grow from 294,000 to just over two million today. The nay sayers would say that is just a factor of momentum, that anybody would have built up those numbers any way. If that was true then account numbers would have grown to about 1.5 million to reflect the fivefold growth in the economy, but instead has grown almost seven-fold during the same period.

Kersey is right in saying that power tariffs have risen three times during the period, a commercially attractive tariff was required to attract investors to the sector.

But the tariff also continues to be out of reach of many because economies of scale have not quite kicked in. Funding for these projects continues to be expensive, partly because we don’t have much local savings to underwrite these major projects and foreign funding remains pricey because in terms of price we are not a prime lending client. Which is related to the first.

Relatedly, if we are to bring the price down government has to be more involved in the sector and hence the taking back of our power generation capacity into the public sector.  But to do this and learning from the UEB experience government has to make those entities that are being vested I with the running of the sector, viable in their own right, if only because government subsidy of the sector is not a sustainable proposition.

"As a rationale for taking back the sector, government has argued that the private players are asking for too high returns on investment pushing up the end tariff. Given this argument one can see that government intends to have its companies not require a return on investment at worst or allow them a very thin margin at best. That would be the mistake that would send us back to the dark ages of UEB...

The last thing that the government wants and the economy needs, is power companies that have to wait for government budgets to finance development or god forbid, come up with payroll.

If government’s current cash crunch is anything to go by, where priorities are shifting by the day, one can expect that if government inflows are the lifeblood of any of these enterprises, they will be dead on arrival.

As consumers and as an economy, we don’t need the power sector to be reliant on government for its day-to-day survival.

The example of National Water & Sewerage Corporation (NWSC) can provide some useful learnings both for and against the reinstatement of public entities to run the power sector.

NWSC has a tariff that is affordable – thankfully ware is all around, but high enough to support the massive investments they have to make. Their viability is such that NWSC can go to the market to borrow money on the strength of its own balance sheet. However, government also guarantees its loans as a way to keep the tariff low and ensure it fulfills its mission to supply water to all.

But government is hampering NWSC smooth operations going by the billions of shillings they owe and seem to see no urgency in clearing their bills.

The same model (apart from the bad debtor part) must be adopted for the new entities that will takeover from the private players. First off government needs to properly capitalize them. Then government needs to allow them a reasonable level of return, not as high as the private players, but enough they can finance their own developments. And also in the light of the huge investments that still need to be made in the sector, government should guarantee the loans and external financing as a way too to keep the tariff low.

The sector’s planners should not see a low a tariff as an end, but as a means to an end, the end being the widespread, sustainable use of power in the economy.

Affordable power is desirable, even critical for our development ambitions, but government should not pander to populists who want power tariffs brought down even if it is at the cost of the long-term viability of the sector.

FDC AND WHY POLITICS IS NOT A TEA PARTY

In the 1985 Wimbledon tennis championships opponents of German teen sensation Boris Becker complained that at the changeovers he tended to bump into them and generally not give way. When the complaint was raised with his manager the bearish Ion Tiriac his reply was “This is not a tea party”

In the last two weeks differences within the Forum for Democratic Change (FDC) that have been festering under the surface for years came into public view. The boil burst this week spewing out its fetid contents for all to see...

Like in the body, this should be a good thing, as the toxic contents of the boil may have gone on to infect other parts of the body if it had not oozed out.

For us on the sidelines of the action, it looks like an internal dispute that erupted but had to be aired out for progress to be made for better or for worse.  But we do not put it past the ruling National Resistance Movement (NRM) to have lanced the boil open.

Beyond this being a natural progression of development anyone who has been watching the FDC from its inception and even before when it was the pressure group Reform Agenda should not be surprised.

There are many reasons things are unfolding the way they are but two jump to mind.

Like with most political organisations FDC was founded on the personality of the Dr Kizza Besigye. Following his run for the presidency in 2001 the consensus was that he was still the one who could go toe to toe with President Yoweri Museveni in the polls. This was in 2005 just before the 2006 elections, which saw the return of multi-party elections to Uganda.

"When Besigye stepped down as party president in 2011, it was always going to be an uphill task to find a leader of similar global appeal. In addition, Besigye never went away. He hovered around Najjanankumbi like a bad smell, making it impossible for his successor Major General Mugisha Muntu to stamp his authority on the leading opposition party. Mugisha Muntu’s successor has fared no better, ceding the leadership of the opposition to Robert Kyagulanyi in the process.

Besigye has argued of course that there is no time/term limit in the struggle to remove Museveni, which makes sense, but one can see how his shadow remains a problem in FDC.

Given that he has been there from the start it would be unrealistic to expect Besigye be an indifferent observer to the goings on.

The second issue which is related to the first is the long-term dominance of the political scene by the NRM in general but Museveni in particular.

Just as at Wimbledon politics is not a tea party. Any ruling party worth its salt will be monitoring the opposition and looking to counter any maneuvers they maybe making. Spreading dissension in the enemy ranks is legitimate political tactics, never mind what the moralists say. Both factions in FDC accuse the other of receiving financial aid from the NRM. I believe them, both.

Beyond that the example of Museveni at the helm of the NRM for decades is causing much discomfort in the opposition. The opposition feel some moral pressure to show they are different from the NRM, to have term limits for their leaders,  which is good for the optics but does not allow anyone to gather momentum and pose a potent threat to Museveni. No sooner has leader gained traction than he has to step aside for “good governance”.

The challenge with this therefore is that every so often there is jostling for position in opposition parties, each contest factionalising and disenfranchising members, weakening them meaning they find it hard to present a united front to the public. FDC suffered this in 2016 and again in 2021.

It is no tea party in the opposition, especially with Museveni pulling the strings across the road. It means there will be no smash and grab rush for the leadership in Uganda. That the road to statehouse – whatever the politicians tell their minions will always be a marathon and not a sprint.

Given the internal tension in opposition parties time is not something they have in any meaningful supply. Their fragility is exposed with the passing of time, more so than with the NRM.

Ideally all political actors should be working towards creating a robust and an enduring democracy. But politics is about the attaining and retaining of power, which often plays counter to the development of democracy. This is the brutal honest truth about politics.

But it is also why democracy is not an event but an evolution. Believe it or not the natural progression is towards individual freedom which is democracy. The nature of each country’s democracy is determined by how they resolve the contestation between the ruling party and the opposition.

The fracas in FDC is excruciatingly painful for those involved but seen against the greater schemes of things and inevitable occurrence in the progress towards democracy.

 

WE NEED TO GO BACK TO BASICS ON BUSINESS LED GROWTH

History has shown that countries are only as viable as their business communities.

If ever there was proof  of this was the collapse of the communist block in the 1990s. The communist led by the USSR believed in controlled economies where government-controlled the forces of supply and demand. A bad idea.

The viability of the business community depends on many things but mainly the sanctity of property rights, the observance of contracts and the quality of the human resource.

The interaction of these then determine the nature and vibrancy of the markets in which the businesses operate.

This last part is important. Think of a market as a place where hundreds, thousands even million s of business experiments happen daily. These experiments are generated by individuals playing in the market. The successful experiments succeed or otherwise are discarded...

No one entity can simulate these experiments and that is why controlled economies have failed spectacularly through history. It is why North Korea, the USSR and chairman Mao’s China before it, are/were nuclear powers but had “bread lines”.

For a government interested in sustainable development the question of to have or not to have a functional market does not arise.

Markets create wealth and not governments.

The trick then becomes how can we then have this market serve our national development aspirations?

The market is brutal. Left to its own devices it gives more to those who have and to those who don’t have, even the little they have can be taken away.

If the role of the market is to create wealth, the role of governments is to distribute that wealth in a way that assures an improving standard of living for the population with out killing the goose that lays the golden eggs, the market.

So, in countries which enjoy growth but have huge income and wealth disparities, it is an indictment on the government and not the market, which has created the economic growth.

The US for example the wealthiest country in the world has among the highest level of inequality, partly for racial reasons but also because the market having been left to run rampant has become so powerful that it fights attempts by anybody to bring it under control.

The National Rifle Association (NRA) in the US fights off any attempts to introduce more stringent regulation around guns held in public hands despite the hundreds that die every year from mass gun shootings in that country. As at the end of June, 416 had been killed in 340 shooting incidents, which would mean more than two people are killed daily in America from needless gun violence.

"But beyond distribution of the goodies, governments’ role is increasing the enabling environment for the markets to thrive....

But to do this there has to be some understanding about how business and by extension the market works.

At the basic level businesses are set up to make money. But all good businessmen know that the extent to which they make money depends on how many people they can serve in a cost-effective way.

Business despite what they say don’t like competition. A monopoly situation is ideal for businesses because they can price their products higher than they could in a competitive environment and make massive profits.

Part of creating an enabling environment is ensuring there is room for fair competition. So governments should be involved in creating new markets, regulating existing ones within a coherent national strategy.

This of course requires a lot of mental application and to avoid it governments’ knee jerk reaction is to create companies. More often than not to their detriment.

Governments are bad at business not because the managers are incompetent, but because for governments other considerations – dishing out favours, other than long term viability are more important to them. Government businesses often survive longer than they should because they have access to free money – taxes to keep them afloat for longer than necessary. It doesn’t take much intelligence to keep shoveling good money after bad when you have an “inexhaustible” stream of revenue.

If a government understands how business is done it need not get involved, it just has to tweak the incentives for business to one, survive and thrive and secondly, to be in line with the national aspirations.

Japan for instance has no state-owned banks, but the banks have been key pillars of their export led development since the second world war. The businessmen initially had to be dragged kicking and screaming to support Japan’s infant industries but have come out the better for it and are more amenable to government’s direction.

In Uganda we went down the way of private sector growth because it was a condition to unlock the aid taps in the 1980s. More recently things are happening that suggest we were not really sold on the project and emboldened by increasing tax collections, government wants to go back into business...

That is where the trouble lies. Some people in government think the main reason our companies had to be got rid of was lack of money. They will soon find out that’s not true. 

It’s a prophecy I would like to be wrong about, if only because it is my money they are squandering in these blackhole new public companies.

"Government has the intellectual capacity to wrap their heads around how markets work and develop an incentive regime for businesses to support national strategy. It is not intelligence that is lacking in our government...

 

BOOK REVIEW: ONE SMALL DIFFERENCE –AN AUTOBIOGRAPHY

 A LIFE LIVED IN THE SERVICE OF HIS COUNTRY

AUTHOR: FRANCIS BUTAGIRA

PAGES: 136 PP

Available at all major bookshops

 

Francis Butagira has lived through the major inflection points of this country since Independence. It is always a pleasure to read the accounts of such people’s lives in their own words. In some ways their story pace second fiddle to the context in which the lived and their hand in forging our nation.

There is a lot that has been lost or is being lost, because a few good men refused or were unwilling to tell their story. This is important because one day these disparate accounts will be the source material for a proper telling of recent history.

In as far as Butagira contributes to this quest he cannot be faulted, his story will be a useful addition to the telling of this country’s history.

Butagira it will be remembered was the speaker of parliament between 1981 and 1985, during the second Obote regime. He came to the position by way of being MP for Mbarara West, which he contested under the Uganda People’s Congress (UPC) badge. He defeated current trade minister Francis Mwebesa in the 1980 elections.

But before that like many of his generation he graduates from a rural background to an urban, even cosmopolitan one – he served as Ugandan Ambassador to the Organisation of African Unity (OAU)UN and Germany before his retirement.

Looking at these elders accounts’, it’s clear that the tools for poverty eradication are within our grasp. While one can argue there was less competition in their time, the high percentage play remains stay healthy and go to school as as the surest means to social climbing...

The child of a parish chief, one may argue he was literally born with a silver spoon in his mouth, compared to the people around him, but you have to give him credit for taking full advantage of it unlike his other siblings.

He studied law In Dar es Salaam before doing his post grad in Harvard, was a judge of the high court before the allure of politics came calling.

Interestingly he became ambassador during the NRM era despite his roots being in UPC. He leaves us hanging on how he crossed to the Movement despite the hysterical protests of his leader, then exiled in Lusaka, Zambia. There must have been some moral dilemma there in breaking away from UPC, especially since he too maintains that charges of election rigging in 1980 were not true. He leaves us none the wiser.

The allegation of election rigging by UPC in 1980 served as the public basis for President Yoweri Museveni and his band of men going to the bush in 1981 and therefore a major sticking point between UPC and NRM.

The book sprints through his diplomatic career, which begun at the Organisation of Africa Unity (OAU) headquarters in Addis Ababa. There are interesting tit bits about negotiations with spirit medium Alice Lakwena, while he was high commissioner to Kenya. Lakwena was then a refugee in Kenya and wanted to return. Lakwena was the predecessor of Lord’s Resistance Army (LRA) chief Jospeh Kony, she led the rebel Holy Spirit Movement, brainwashing her followers to believe that by smearing special oils on themselves, would make them immune to government fire, an adventure that did not end well for scores of Acholi youth.

Maybe bound to secrecy, but during his time as a ambassador were some of the most hectic times for the country. One imagines our involvements in the Democratic Republic of Congo must have had him working overtime at the UN, our transition to multi-party democracy and other questions about governance in Uganda must have exercised him as a diplomat...

Nevertheless, he is understandably proud of his work as diplomat, that being the biggest chapter in the book, given his longevity in the foreign service he must have served his country well.

Though short on detail, the book is competent record of a period of much interest in our country through one man’s eyes. It is a quick read, a broad-brush stroke through the life and times of the author. It would be served well by an update, where the author fleshes out more about his role, thoughts and perceptions about the key events in our history to which he was privy.

The book is to be launched on Thursday, 20^th July at Protea in Kololo and along with it “International Diplomacy” a compilation of his speeches and interventions at the UN.

 

INCREASING UGANDA BANK CAPITALISATION LONG OVERDUE

Last week Bank of Uganda communicated that the process of banks raising their minimum capitalization by the end of the year was going well.

Under the Financial Act 2022 commercial banks are supposed to raise their minimum paid up capital to sh120b by the end of 2022, but preferably by the end of last month. The previous minimum requirement was sh25b. By the end of the next year the banks should have bumped up this number further to sh150b.

"The idea behind the steep increase is recognition that it was long overdue, going by the duration between the last increments, but intended to enable banks become more resilient, able to absorb bigger shocks, ensure the stability of the sector and improve the ability for banks to do more for their clients...

In all three respects we have come a long way but still have a long way to go.

In 1998 and 1999 when we had a spate of bank closures, the law provided that minimum capital requirement to set up a bank was sh500,000 for a local bank and one billion shillings for a foreign bank. The good old days!

It should not come as a surprise that of the four banks that collapsed in the late 1990s three of them were local. If these banks had stayed on the straight and narrow, who knows we would have more, big privately owned local banks today.

Most of the bank closures were due to failures due to insider lending. The owners of the bank were lending themselves and cronies money, which they neglecting to repay the loans. Essentially the Ugandan depositor was financing these ladies and gentlemen for free. And they may have got away with it if they had not got too greedy and compromise the banks’ balance sheets irredeemably.

As a result of those bank collapses the central bank in 2004 raised the minimum paid up capital requirement to sh4b and raised this figure again in 2010 to sh25b. This in addition to limits on how much one shareholder can own of a bank and how much banks can lend to one client have meant that the sector has been spared the upheavals of the late 1990s.

"It was inevitable that bank capitalization was going to rise eventually but imagine if one had set up their bank with sh500,000, about $500 in 1993 when the law was passed, and built up the banks’ equity with retained earnings, it would not have been a stretch to meet the subsequent capitalisation increases. That’s the problem we are always wiser in hindsight...

But when you hollowing out the bank at every turn, it will take a small crisis and the whole operation comes falling like a pack of cards. Hence the need for the bank owners to put in more of their money to cover reasonable losses without jeopardizing the bank.

Covering the downside is always a good idea but to my mind what this increase in capitalisation will do is force banks to be more innovative and even aggressive in their provision of services. As it is now the biggest bank’s profits far outstripped their paid up capital last year, which means their respective owners were literally laughing all the way to the bank, forgive the pun.

Private investors should get an adequate for their money, but if the society in which their business operates benefit proportionately that’s a guaranteed win-win situation.

Used to these juicy returns bank owners in London or Johannesburg or Nairobi or New Delhi if they commit more of their funds will expect comparable returns, say six times more to much the increase in their contribution to the business. Bank managers will have to find ways to increase markets share, provide more products to their clients and even seriously consider lowering lending rates to meet the new targets. Doing all this legally and safely.

For example, unsecured lending really took off after the 2004 increase in minimum capital to sh4b from the earlier one billion shillings. Previously banks were content to insist you provide collateral for any lending. AS it is salary loans are now a major component of any banks revenues and the fastest growing revenue stream in the industry.

It will also means banks can finance bigger projects locally rather than syndicate them abroad. This may see banks paying more in taxes as they keep more of the profits from such transactions.

Of course there are those who will jump up and down and complain that increased capitalization effectively shuts out local banks. Well if previous experience is anything to go by maybe that is a good thing. But it is also not true there are no local banks – Housing Finance Bank and Post Bank are there and holding their won.

But also it an indictment on our business community, that if they feel so strongly about having a local bank, why don’t they come together raise the required sh120b and meet other requirements and have their own thing.

Oh, but they did that in the past with Greenland Bank, unfortunately it went under in 1999. Insider lending again the main culprit. A case of once bitten twice shy?

 

DAM CONFERENCE TESTAMENT TO HOW FAR WE HAVE COME

At the beginning of the century, we were grappling with daily loadshedding, which was only just being alleviated by contracting emergency power suppliers, Aggreko.

Our dams Kiira and Nalubale, with total generation capacity of 380 MW, were woefully inadequate to match peak time demand.

The commissioning of Bujagali in 2012 gave us a much-needed sigh of relief and the hope that the bad old days are good as gone.

We have come a long way from those days of day long load shedding to a situation where if power supply is off for 30 minutes it can become a neighbourhood crisis. A case of familiarity breeds contempt?

"They say the prophet is not appreciated in their own land, which makes next week’s “Water Storage and Hydropower Development for Africa” a validation of how far we have come since 2000...

The conference, the fourth of its kind on the continent by the International Commission on Large Dams (ICOLD) will see about 500 delegates trooping to Uganda to not only deliberate on the future of large dams on the continent but take stock of Uganda’s progress in generating power using hydroelectric power.

Only Ethiopia, Morocco and Namibia have hosted the African edition of the ICOLD event.

In a time where climate change issues are front and center of every it helps too that almost all our power is generated using renewable energy means.

The conference coming to our shores is also testament to how central to the industry Uganda Electricity Generation company Ltd (UEGCL) has become to the energy value chain in Uganda.

UEGCL is now the largest power generator in Uganda with its control of the Namanve Thermal Power Plant, Isimba dam, The Kiira-Nalubaale dam complex which they only took over from South African power company Eskom earlier this year. It is due to take over 600MW Karuma dam, whose three of six turbines are already feeding power onto the grid.

"The conference comes at a particularly interesting juncture in our electricity story when many of the concessions in generation and distribution are reverting to the public sector and Uganda may in future serves as a case study of how to liberalise then deliberalise the power sector, for better or for worse...

But we are jumping the gun.

Next weeks, conference will bring together not only dam operators but also planners, designers, contractors, financiers and many other players in the sector. It will be a godsend opportunity to expose our industry to all these players and given that we have not maximized our potential on power generation, we may make very interesting connections that well serve as well in our ambition to generate beyond 10,000 MW by 2040.

Currently the main challenge facing generators in Uganda is how to sell power to the grid for not more than US5cents and still ensure long term viability of plants and utilities. During the conference we may very well learn from other operators from the continent and further afield how we may hack this question.

The US5cents target has been set by President Yoweri Museveni as a prerequisite to spurring the industrialization this country badly needs to add value to our raw materials and to increase job opportunities.

The conference is also a unique tourism opportunity for the country. Over the week or so they are here they will not only be jostling of the minds, but delegates will drive out to see our various dams, driving through the scenic beauty of our countryside to get there.

Meetings are a useful source of tourists. We have not been as consistently deliberate about MICE (Meetings Incentives Conferences & Exhibitions) but the potential is self-evident. Apart from room and board if each of the 500 attendants spent $200 during the week that would be $100,000 into the greater Kampala economy. And if we can wow them with our hospitality and the general experience this $200 may be a gross understatement. Better still we would have made ambassadors of the delegates to their respective countries, a better tourist attractor than any flashy website or high-sounding official...

Electricity generation is not a sexy subject, it doesn’t even generate much anger nowadays, because we have more than enough to consume. But no country has any achieved any serious development without sorting out the power issue and as such even if they work quietly in the background, power generators and UEGCL in particular play a central role in the economy.

Attracting a high-powered conference as next week’s is only icing on the cake.

 

ISLAMIC BANKING A STEP IN THE RIGHT DIRECTION

Last week parliament passed the Financial Institutions (Amendment) Bill that establishes Islamic banking services in Uganda.

"Islamic banking is among other things, based on the principle that earning interest from lending is haram (taboo). Banks operating under this law finance businesses by becoming their partners and sharing the profit that may result from the transaction financed...

This is welcome as an alternative financing model that our market sorely needs.

The challenge for our banking industry is that is dominated by commercial banks. Commercial banks tend to finance going concerns as opposed to startups for example. A company that is beginning needs another kind of financing than the type of bank lending that dominates our market. Similarly, an agricultural enterprise or a real estate developer or an industrial concern.

What we have now is largely short-term financing at high interest rates, with little differentiation to cater for unique categories. This has a lot to do with the dominant source of funds, largely short-term deposits.

The banks have dipped their toes in various products, but clearly more specialization is needed, to cater for the different stages of the business cycle, as well as the different sectors of the economy.

One of the major reasons for business failure in Uganda is undercapitalization, that businesses are set up with too little money to survive the vagaries of business. In Uganda businesses are set up with individual savings, which is as it should be, and then the business owners hope to survive off sales. So, when sales don’t happen quickly, as in the case in increasingly competitive business environments, our businesses fold.

In other places where their financial sectors are deeper small businesses have access to government support, angel investors – rich people organized to help small business, venture capitalists all before or as alternatives to commercial bank lending.

And this maybe a major reason why our businesses remain largely informal. To qualify for all these “lower” levels of financing in those economies businesses need to be formalized – registered, have books and some rudimentary structures that suggest the business has a chance of survival if a bus runs over the founder. The more organized you are the more funding you can get.

While it is important for government to enact laws to regulate these various levels of funding what often happens is that the industry is set up and then policy and law follow.

Government is on the right track trying to create these markets with its various funds for small businessmen. A case can be made for government to develop laws and regulations to incentivize the private sector to join these markets. Government by their nature cannot do such things efficiently, patronage leading to corruption are bound to doom government efforts. That is why they need the private sector to join them and supersede them. The sooner the better.

Which brings around nicely to the excitement about the passing of the Islamic banking law and why we should manage our expectations around this product.

So the excitement seems to be around the understanding those banks offering this service will not charge interest. Banks make money by playing the middle man between those with excess funds and those with need for funds. They charge interest, fees or whatever for delivering this service.

The model we are used to is that we deposit our money with the banks and they take that money and lend it. They have managed the model in such a way that even if you go back for your deposits they will give them back without upsetting the cart.

Under this model the bank often times doesn’t care what you do with the money as long as you pay them back.

If you have a working business model the trick then is to cover the down side, mitigate against risk.  Banks do that now by ensuring you have a steady income from which they can draw their dues and/or have collateral they can flog in case of default. They are biased more towards ensuring you have the revenues to pay them which is why people say that banks lend you money when you do not need it.

In the case of Islamic banking the way they cover their risk is becoming a partner in your business. That is something people are glossing over. What does that mean? To cover his risk the banker will now have to become intimately involved in your business he can refuse to fund you for example if you are not up todate with your tax obligations, a situation which may prove a real risk to you realizing profit. He may require some managerial changes coz your brother who is the CFO just does not cut it. He may have a say on the business he is financing, you want to import 100 tons of starch but for it to make sense to him, he may require you import less or more...

While it may prove uncomfortable for our businesses to switch to Islamic financing, it has long term benefits, for them and the economy, if it allows our businessmen to move more and more towards formalization. On the other hand it will improve our bankers’ business acumen, because now beyond just assessing whether the business is good for the money they will have to have a better understanding of the business, its drivers and risk. If for nothing else I am a fan of Islamic banking because of these.

It is not unlike other financial services for early-stage businesses in the western world.

With the increase in capital requirements, banks will have to be more innovative, cater to more businesses to remain viable. It is hard to see the downside in these new developments.

 

SUCCEEDING BEYOND HIS WILDEST DREAMS

BOOK REVIEW

BOOK; TEARS & TRIUMPH

AUTHOR: ONAPITO EKOMOLOIT

433 PAGES

available in all major bookshops

 

Onapito Ekomoloit, Ona as he is popularly known, has lived a checkered life, the essence of which his book “Tears & Triumph” goes some way to capturing.

For a child, whose survival at birth was put in doubt by a difficult delivery, Ona’s life has taken a convoluted course that has seen him grow up in the Teso heartland, studied in Gulu, Kampala and Washington DC, start and close a newspaper, become an MP, appointed presidential press secretary before falling back into the private sector at Nile Breweries.

The colourful description of his childhood, which included getting up to mischief, eating all sorts of birds, his almost dropping out of school, though brief makes for good reading and sets the tone of the book early own. It is also useful record of how the typical rural child grew up and experience ath is lost to many with the advancements in technology and general development.

"The early loss of his mother almost derails his life until the forceful intervention of his older brother sees him back in school, setting the stage for a career that has far exceeded his expectations...

Born in 1966, he was witness to a sliver of Uganda at its best, before it descended into political instability and economic ruin. Born into the Iteso of eastern Uganda he remembers that their cattle were the bedrock of the economy, a foundation that was swept away with the massive Karimojong rustling of the 1980s, triggered by the coming to power of the National Resistance Movement (NRM) with far reaching implications for the Iteso and himself in particular.

The change in the fortunes of the Iteso was a major factor in taking him away from home to seek his fortunes elsewhere, which evidently widened his perspectives and broadened his horizons.

Despite a tumultuous childhood dotted with loss and tragedy, Ona had the brains to make it to Makerere on a government scholarship, no mean feat given that in those day’s intake to the only university was barely 2000 students. There were no private students.

Makerere at the time was the last hold out against the NRM, which had coopted all political forces onto itself. Uganda in an attempt to jump start the economy had come under the wing of the World Bank and IMF, among whose prescriptions was a rationalization of government. Makerere’s student stipends – “Boom” were not spared, setting the stage for a volatile relationship between student body and government.

Ona’s political bone was revitalized at Makerere, where he served as information minister in Emmanuel Dombo’s guild administration.

Was it that we were enjoying the book too much, but one feels that from his university days he kind of rushed through the book, skimming over his journalistic and political careers. His relationship with President Yoweri Museveni was more notable for how he escaped death at the hands of Joseph Kony’s Lord’s Resistance Army (LRA) than for his impressions and relationship with the president. He explains though that the president is a bit aloof from his staff, making it nearly impossible to attain any rapport. It may also be asking for too much by the reader that we get a deep psychoanalysis of the president given that he is still in power....

Nevertheless, his narration of his time serving as the press secretary adds useful details in understanding the Museveni administration, coupled with other accounts will with time give us a fuller picture.

Ona promises another book where he will dive into deeper detail about his life at Nile Breweries where he has now been elevated to the position of chairman.

Ona is relatively young and one has to think there is still a lot for him to achieve in the second half of his life. A second book therefore will be a useful addition to this his first effort.

It is an easy-to-read book with a lot humour and interesting anecdotes about and surrounding his life. On the whole he has told his story well and must be lauded for putting pen to paper as a record of the Uganda he has lived in, as one of pioneering group of journalists during the NRM era.