Wednesday, November 15, 2023

A WELCOME ANALYSIS OF UGANDA’S CHANGING ECONOMIC FORTUNES

BOOK REVIEW: TRANSFORMATIVE ECONOMICS; UNDERSTANDING THE PATHWAY TO ECONOMIC TRANSFORMATION

AUTHOR: PROF AUGUSTUS NUWAGABA

PP: 356 pages

 

The challenge for Uganda is to lift the economy from a pre-industrial to a modern one. To lift the majority of citizens out of poverty, though increasing their productivity and therefore earning power.  A modern state would be characterized by higher productivity in every sector, better living standards for all, trade in processed/manufactured goods, industrialization towards a more ICT driven economy among others.

To do this one has to understand where you are in the continuum of development and how you got there before you can fashion a route to development.

Professor August Nuwagaba does this simply enough for anyone to understand.

He identifies that land tenure system as designed in the Buganda Land agreement as a major impediment to our economic advancement, shows that the expulsion of the Asians in 1972 was a disaster and that by liberalizing markets, privatization of state enterprises and introduction of tax reforms the current government did the right things to resuscitate the economy.

The neo-liberal policies that have got us to this point, with its emphasis on fixing the macroeconomic environment and hope for a trickle down of the benefits, has taken us as far as it can, with a small elite benefitting disproportionately to the larger public.

So in his book—as the title suggests, he tries to chart a way for lifting the Uganda economy from its current state to an industrial and post-industrial economy.

Nuwagaba has strong opinions on how the drivers of the economic recovery of the last four decades can be retooled to drive transformation. Economic policy, monetary policy, debt management and aid among other things but he is clear that it first begins with the individual. 

"Each individual has a responsibility to raise their income, save and invest more and remain healthy and it is on this that all other drivers can be built....

We will not be reinventing the wheel and Nuwagaba has some interest case studies from the Asian tigers and Europe that light the path for us. The retooling of education away from producing learned graduates to churning out individuals with the relevant skills for the various stages of their development path is key and plays on the notion that all progress starts with the individual.

It is clear through the book that while we deserve a pat on the back for resuscitating the economy over the last 40 or so, this has only served to create a foundation for the real heavy lifting that is to come. Another mind shift is required and disciplined execution of a well thought out strategy is imperative.

A major omission that is hard to ignore however, is the role of corruption in slowing or subverting progress. While no country is corruption free, for a developing country like ours corruption concentrates resources in a few hands, denies the majority the services required for them to lift themselves out of poverty, distorts markets and threatens social and national security.

While it is a whole subject on its own, ignoring it misses a major piece of our context and why the best laid plans can still go awry.

"Development is not a natural progression. It can be subverted by human beings ignorance, ideological disorientation and putting their wants above those of the greater public. Our history is littered with how damaging a lack of strategic focus can lead to misguided actions however popular that can derail progress for generations.

As mentioned earlier, the book does not require any high appreciation of economics to follow the logical thread Nuwagaba has woven through space and time, where we came from and what we need to do to deliver a better future for our country. The book would do with a lot more contemporary case studies especially of how policies like liberalization and privatization have got us to where we are.

This book is a useful reference for anyone wanting to understand why we are where we are as an economy and what needs to be done for us to get to the next level. This book should be required reading for Ugandan economists and planners. It is a useful addition to the study of the economic history of this country.

 


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