THE FOURTH INDUSTRIAL REVOLUTION IS HERE

A fortnight ago the Fourth Industrial Revolution (4IR) National Taskforce presented to the public a draft strategy, the broad strokes of how Uganda is going to situate itself in this new phenomenon.

The first industrial revolution saw the shift away from animal and manual power to the use of fossil fuels for energy and mechanical power. Electricity heralded the second industrial revolution. We are easing out of the third revolution where digitisation and internet connectivity have been its main features. The fourth industrial revolution is seeing the combination of virtual, physical and biology interactions facilitated by technology.

Looking down the ages  we can see that the duration between industrial revolutions are becoming much shorter, with each revolution increasing human productivity dramatically.

The difference between how far one can go on bicycle as compared to riding in a car not only  compressed distances but time itself. Or the difference in output between having a computer connected to the net and juggling a typewriter, calculator and making regular runs to a physical library.

The fourth industrial revolution, with its advances in cloud computing, Artificial Intelligence, blockchain technologies, 3D printing, autonomous vehicles   and biotechnologies is going to dramatically – is already, changing the way we produce, distribute and consume goods and services.

"The wide application of these technologies, as will inevitably happen is set to increase our productivity exponentially to the point that futurists envisage a time when machines will do all the work and we will be paid to just seat around....

As incredible as that sounds, as recently as the 1980s the idea of wireless telephony, driverless cars and 3D printing were the stuff of sci-fi novels and movies.

But just as the potential of this new revolution is hard to wrap ones mind around its also true that the early adopters will have a head start on everybody else, with real ramifications for global and local wealth distribution, security and natural resource usage and regeneration.

It was therefore inspired thinking when Uganda launched its 4IR taskforce to look into how Uganda can proactively take advantage of this new revolution.

Over about a year the taskforce chaired by John Nasasira, himself a former ICT minster and peopled by members from government, academia and the private sector have turned the subject upside down and come up with a strategy which will help Uganda get ahead on the subject.

"The opportunities identified include increasing agricultural productivity, boosting human capital development, supporting urbanisation and governance and bridging other development deficiencies...

Its an elegant document that spells what and where the opportunities are, how we can set up to take advantage and the agencies that will lead the charge into the brave new world.

Its value will be in how much the government will adopt and operationalise the strategy.

To illustrate, if we had comparable document going into the ICT era the government would not have stumbled over issues of taxing computers and mobile phones, would have been better prepared to create an enabling environment which allows us to take maximum advantage of ICT and even prepared us better for 4IR.

We are not the worst –

we have a liberalised telecommunications sector, which has seen our phone penetration increase by leaps and bounds, introduced financial services that exploded the stuffiness of the banks and increased the general productivity of the economy in the face of donor moodiness, a global financial crisis and several natural disasters.

Imagine if we had been more deliberate and systematic in appreciating and taking advantage of the digitial age? It is not a stretch to imagine we would be much better off as a country today.

To take advantage of this new era certain enablers have to be put in place – greater 4IRconnectivity, greater regulatory agility, upskilling of Ugandans, deeper eGovernment, resource mobilisation and investment promotion to attract new players.

"Contrary to popular opinion government has a good record of following through on reports it generates, only that it s does not accompany the execution with as much fanfare as they do when releasing the report....

Given the speed with which things are changing this new strategy has a short shelf life than say the report on URA or the police, so speed is of the essence in operationalising the strategy.

Nevertheless its a document that can be referred to and upgraded in coming years.

I remember more than two decades ago to get my stories to Nairobi where the Reuters office was, i had to type the stories out, slide down to the post office to send the fax and stand by the fax machine to ensure the whole story was transmitted. The process took at least an hour.

"Today not only are fax machines obsolete but off my phone I can write a story, while in motion and email, whatsapp or text it down the line, the whole process taking little more than 30 minute  or not much more than it takes to write the story...

.

In theory I can now generate at least twice as much as I used to then and for much cheaper.

I think that’s amazing. But I have to pose when I think that with proper utilisation of 4IR technologies the same story may take even a third as much time to execute.

Comparable gains can be seen in any industry. Hang on to your seats we are in for an exciting ride.

RAISE NOMINATION FEES FOR A BETTER DEMOCRACY

The week begun with the presidential nominations, the culmination of a process that begun with nominations for local governments and special interest groups.

The substance of the event was overshadowed by the manhandling of opposition leaders Robert Kyagulanyi, the National Unity Platform (NUP) candidate  and Forum for Democratic (FDC)’s Patrick Oboi Amuriat. 

Another sub plot transpired with two aspirants – Nancy Kalembe and John Katumba, failing to pay the sh20m nomination fee on their allotted day.

"They say all publicity is good publicity, hard to argue against that given the media space given to Kyagulanyi, Amuriat, Kalembe and Katumba compared to that availed more established politicians as Mugisha Muntu, Henry Tumukunde and Norbert Mao...

The nomination fees, which were raised recently, for both presidential and parliamentary aspirants has been a source of much debate.

Critics of the higher fees have argued that it was locking out the poor, who may nevertheless have good leadership potential.

More than higher education qualifications, we need to further raise the bar on presidential nomination fees to say, sh100m or even a billions shillings if we are to help our democracy along.

Nomination fees are a serious declaration of intent. They indicate that the intending candidate is not some clown off the street. That he has the capacity to mobilise funds. And yes it should serve as major criterea to weed the chaffe from the wheat. 

Ideally the fees should not be put up by the intending candidate, but by his supporters and interest groups that believe he or she  best represents their interests.

So the issue of poverty of the candidate should not arise. If the intending candidate has a serious cause to put forward, even if not a serious chance of assuming the highest office in the land, he will be able to mobilise backers who will foot the bill.

It is the reason that Donald Trump will have fundraisers for his campaigns despite his claims to being a billionaire.

So if you raise the nomination fees, while you will have a smaller pool of intending candidates, you will have more credible backers for our candidates. Backers who are not looking to throw their money away but hoping to make an impression in the campaigns. That their agenda will get enough airplay to be taken seriously  by whoever is the winner, if it is not their own candidate.

And what kind of backers will these be? Major players in the economy – farmers, industrialists, traders and real estate moguls. They will be sponsoring candidates to front their issues, which issues will benefit the larger community as well. 

"We keep complaining that we want an issue based campaign but since almost any Tom, Dick and Harry can be a candidate, in a country where the biggest issue is development, its only personalities that  will distinguish candidates....

One of the reasons our democracy is limping along, is because we don’t have parties, strong institutions with distinctive agendas, whose issues distinguish them from each other and are identifiable by the voters for the issues they espouse.

Raising nomination fees will force parties to be more coherent in their agendas, which when they present to financial backers will give them cause to open the purse strings.

"With one fell swoop we will have eliminated adventurers looking to catch the eye of the president, careerists looking to pad their CVs or good for nothing chartalans....

While politics is too important to be left to politicians, their should be a process of graduation up the ranks. You have to wonder about someone who has not even been on the village LC vaulting to contest for the presidency.

We have come to this situation thanks to the NRM decades long project to dominate the political space.

When they rolled into Kampala in 1986, while a formidable fighting force they were thin on the ground politically. By suspending party activity and promoting politics by individual merit, they tore up the vetting mechanisms that come with a multi party system.

"Allowing independent candidates, while a human right, serves to  short circuit the building of political institutions by frustrating party discipline....

Raising a billion shillings for your party flag bearer for the presidency or sh100m for parliamentary aspirants will force parties to focus on building their structures and whip their members into line.

There will be some grumbling – we are now too wed to individual merit system, but in the long term it will be good for democracy – and spare us the circus on nomination day, which may even be shortened to a few hours event, that wont disrupt hard working members of society ability to go about their business too long.

UGANDA HOTELS NEED HELP!

Last week on a whirlwind trip around Uganda, I had the pleasure – and sometimes the displeasure, to test the best and worst of Uganda’s hospitality industry.

It was sad to see investments worth billions failing to live up to their  full potential just because the bathrooms are designed badly or the receptionist is working like they are doing patrons a favour or you can not locate an establishment on google maps. That last one may sound funny, but the promoters of establishments need to realise we are past stopping on the road to ask a random bicyclist, laden with sugar cane, the way to such-and-such place. Guys?!

There was a lot of good to report from Jinja to Lira and from Mbale to Fort Portal but I think the industry will be better served by a how-not-to list, so here goes.

1. Get your google location, right

It is not funny when at the tail end of your journey the google maps sends you  10 km out of town and then announces in that tinlike voice “You have arrived. Your destination is on the right” where there is only a grass field and brick kiln.

The days of making the best mouse trap and people will make a beaten path to your door are gone. You have committed millions shillings on an investment, it is the height of negligence not to have information – accurate and attractive, out there so that people can find you where you say you are.

In relation with that what is it with pictures of shower faucets, tiled floors and light bulbs on your websites?

The way the trip was designed given the covid depression in the industry, there was no real need to book ahead, just outside every town we checked to see what was available. Believe it or not that is the way people travel these days,  referencing online sources, believing client appraisals and judging by the nature of material you are putting out whether to patronise you or not.

So if you invested a billion on your facility the least you can do is invest a few thousands to get some well done pictures and a half decent web presence.

2. Staple a smile on the receptionist

When you have been on the road for a few hours you just want to get to your destination, clear the preliminaries, get to your room and put your feet up. In this context it does not help if the front of your operation is a grumpy receptionist, who meets every enquiry with a sneer and everything else with a resigned shrug of their shoulders.

These are hard times. Hotels have cut back on staff, rolled back the perks and are counting all the pieces of meat. We understand how there could be some hard feeling all around. But even more so now than ever, our hotels need to invest in amiable individuals to serve as the front of the operation not only at the reception but also on the phone. Our smaller, local establishments need to be making hay while the sun shines.

3. The bathroom is not a by the way

You like the room, they have a flat screen and AC, but the bathroom! It is not ok to have a shower in the same pace as the toilet in a way that you will be splashing all over the toilet seat when you are showering. It will not do that to use the sink you have to contort yourself into shapes because they just slapped the sink behind the door as an after thought.

These should be obvious but these faux pas happened enough times to realise that they may not be that obvious to our local investors.

Design aside, on a good day a normal bathroom habours millions, if not billions of germs invisible to the eye. It is not on, that you have not changed the towels, it is not on, that water does not drain properly out of the shower and it is an absolute deal breaker that you still have condoms in the waste bin!!!

4. Food! Food! Glorious Food!

In these hard times virtually no one was laying a buffet spread. It was all a la carte menus. In several places it seems they sacrificed quality in the kitchen to save a few shillings. Bad idea. We are away from home, we have to trust what you are serving – stay away from white meat if you don’t trust the cooking. I had to spit my meat out because it tasted like offals, awful. I had ordered chicken wings!! 

The kitchen will make or make your establishment, again we thought these were standard requirements but we have been disabused severally on the journey.

There are hundreds,  even thousands of small establishments dotted around the country – hotels, motels, restaurants, I am convinced you can’t lack for accommodation or a good meal anywhere in Uganda. But our poor proprietors are treating their establishments like they do their farms – a source of sustenance and not interested in maximising its full potential.

In the hospitality business all the advertising in the world counts little compared to word of mouth referrals, because eating or going to sleep in an establishment is a personal thing. For the few hours I am there i am entrusting you with my safety and good health.

The hotel proprietors of Uganda lets get the basics right – location, hospitality and food right and then we can add all the other bells and whistles later. Please!

FARE THEE WELL, COL SHABAN BANTARIZA

It has always seemed redundant to me to eulogise the dead. First of all they can’t hear all the good – never bad, things you say about them, so who are you trying to impress? Why didn’t you say those things when he/she was alive. Secondly, especially for those of high achievement,  the words rarely match up.

It is an ego trip, to let people around you know you knew the deceased – they never eulogise the lowly in society.

With that out of the way, I first met Col Shaban Bantariza in the late nineties, when I was beginning to report on the Lord’s Resistance Army (LRA) in northern Uganda. I called him seeking comment and he said since he had never met me it was only fair that we meet to size each other up.

He had an office in Mbuya barracks or at least that is where he asked me to meet him. I found him in a bare room except for a wooden table, two chairs and a bench. The table was bare except for a pistol that lay nonchalantly on his right. I never thought of it then until much later, I wondered “What was a pistol doing on the table?”

This was the beginning of a fruitful relationship, I would like to think for the both of us. He was always ready with a quote and I guess as the Reuters correspondent in Uganda I was useful to him in getting the perspective of the UPDF out into the world.

"He was not only always good for a quote, he understood – that’s the impression he gave me, at deeper level why the army did what it did and understood those actions in a larger political context....

One incident that I look back on with fondness and a degree of guilt, must have happened around the entrance of Zimbabwe into the DRC war, on the side of then president Laurent Kabila against Rwanda and Uganda.

Ugandan and Rwandan backed rebels in 1997 had swept across eastern Congo and overthrown Mobutu Sese Seko. However, Kabila’s attempts to wean himself off his allies caused some hard feelings and a second war begun between the erstwhile allies – Uganda and Rwanda versus Kabila.

However in September 1998 Zimbabwe threw its hat into the melee, siding with Kabila. I remember vividly the announcement that Harare was throwing its lot behind Kinshasa came on a Friday.

I called Banatriza to ask what this meant and he said something to the effect that Zimbabwe would leave its shirt and shoes in the jungles of Congo

The next day New Vision picked up the story and run it as a second lead in the Saturday Vision.

I got a call from Bantariza early that morning, “Busharizi, you have killed me,” were the first words out his mouth. He never really explained what he meant and did not claim I had misquoted or misrepresented him. After the call another call came in asking me whether Bantariza had really said those words, that’s when I thought he was in deep s**t.

Almost 20 years after the event I met  him in his new capacity as deputy chief at the Uganda Media Center. I thought enough water had gone under the bridge to ask him about that Saturday morning those many years ago. He remembered it very vividly. He laughed his hearty laugh, “You leave that one alone.”

It was testament to the man’s character that he took responsibility for what he had done and did not try to pass the buck on the subject.

On a later occasion he made me look good in the eyes of my editors.

We had shut down the Nairobi bureau for the day and decided to go and catch a beer on our way home. Several beers later a call from London came in reporting that “the competition” – Reuterspeak for other newswire services, was reporting that the UPDF had “abducted” Fr Carlos, a Spanish priest operating in northern Uganda at the h eight of the northern insurgency.  

The bureau chief said we could match the story, so we returned to the office, a few beers weighing on our heads, to try to salvage the situation. Time check 11 pm. I called Bantariza who didn’t pick the call the first time because he was nursing an injured finger. He came good on the second call and without grumbling about the time of the night, gave us the UPDF version of events. For a few days after that people at the office were in awe of me, that I could get the army’s spokesperson out of bed to comment on a story. All my attempts to give context to how that happened were waived away with the comment, “Don’t let the facts get in the way of a good story”. 

"He gave me and several other young journalists a chance. Wet around the ears, but convinced that we knew the truth, he humoured our youthful exuberance and patiently spelt out the army version of events whenever we asked. We didn’t always agree but his accessibility and coherence ensured that the UPDF voice was always heard....

My last tale about this man who has gone too soon. On the day the results of the 2001 presidential election results were announced I called Bantariza to ask his comment. He was on the way from the airport, having just landed from Liberia where he was part of a peace keeping mission.

I started our converstion with something like, “Congratulations, your candidate has won, give me a comment?” There was a pause at the other end of the line then, “Who is my candidate?”

Rest in peace Colonel Shaban Bantariza!

MOBILE BANKING COMING SOONER THAN WE KNOW

Last week the Bank of Uganda released its annual report for the year ending in June.

Aside from the big numbers – the economy grew by 3.1 percent in 2019/20 down from 6.8 percent the previous year, that private sector credit had slowed due to the Covid-19 related lockdown, there was the interesting statistics on the mobile money front.

"In the just concluded year sh79.7 trillion was transacted on all mobile phone platforms, this figure was up 19 percent from the previous year’s sh66.9 trillion...

To put this in perspective the national budget of Uganda for 2019/20 was sh40trillion, so twice as much money went through the mobile phone platforms than government shelled out to run its programs.

Also this number which comes to about $21b is 70 percent of the sum total of all the economic activity or GDP last year.

This last comparison, no less important than the first, suggests, no, points to the fact that mobile money is playing an increasingly significant role in the economy.

The service has evolved from just a money transfer business between mobile phone subscribers, now you can save and borrow money off your phone and slowly but surely gaining traction as a payment system.

We don’t have to look far to discern the future. Across the border in Kenya Safaricom’s MPesa is now a preferred payment system but in addition now companies there can transact with each other on the platform.

NATIONALISM, THE LAST RESORT OF THE SCOUNDREL

Two weeks ago the commercial court made a controversial ruling in a case between Kampala businessman Ham Kiggundu and Diamond Trust Bank (DTB).

The highlight was the court ruling that  a DTB loan to the businessmen that was executed by the parent Kenya bank was illegal as DTB-Kenya was not registered to do  business in Uganda.

The court went on to reverse the payments the bank had made to itself from Kiggundu’s accounts when they claimed he defaulted on the loan.

Interestingly Kiggundu claimed he had repaid the loan. Anybody who has ever taken out a loan with a bank knows its unlikely, next to impossible, that you can repay their loan and the system does not register the payments. So who is fooling who?

It is

a detail that was lost in the larger picture of what the ruling meant for the industry and economy.

Kiggundu has been telling anyone who can listen how this is a conspiracy against the local businessman by foreign banks and will have dire repercussions  for our economy.

It reminded me of the bank closures at the turn of the century, which mostly put paid to locally owned banks.

In all cases the banks had sunk under the weight of growing bad loans, to businessmen who didn’t think they needed to repay their loans. In addition a lot of red ink in the bank books were due to loans to related parties – directors and affiliated companies, that had  gone bad.

In one case, the bank even illegally sold shares to the public and lost all the new owners money.

In those cases too the local bankers claimed it was a ploy by the foreign interests to stifle the growth of the local banking industry  and the local business community by extension.

They say nationalism is the last resort of the scoundrel.

"Whenever people start making none business arguments to justify their incompetence or theft – the best way to rob a bank is to own one, they say, a red flag is raised in my mind....

Banks aggregate savers’ deposits and lend these funds to borrowers.

Following the closures in the late 1990s and early 2000s the laws were amended to increase the minimum capital from less than a billion shillings to now sh25billion or less than $10m. 

This was in light of the growth in credit, the higher the capital the more the bank can lend without putting savers deposits at risk.

Also the banking regulations are such that no bank cannot commit more than 25 percent of its loan book to one borrower.

In the context of the Kigundu case where his needs were for $11m ( sh40b) you can see how few of our banks – foreign owned or otherwise, could handle him.

In addition no one single individual can own more than 25 percent of the bank, a safeguard against insider lending and other malpractices.

"The net effect of this ofcourse is that locally owned banks have fallen by the wayside – Ugandan businessmen seem incapable of coming together to meet these requirements....

The argument has been made that the requirements for locally owned banks should be eased, but that will only mean they wouldn’t be able to lend to the Kigundu’s of this world anyway.

There are structural issues in the financial sector, not least of all that it is dominated by commercial banks, who by their nature are not suited to lending to start ups, small business, agriculture and to long term projects.

Banks need to be better capitalised too. The sh25b minimum capital requirement may have been adequate 10 years ago but is now woefully inadequate. 

The Kigundu case inadvertently is saying that in order not to borrow from abroad our banks have to better capitalised, further knocking out the locally owned bank.

And what is it about foreign owned versus locally owned banked?

"Are we saying that local banks don’t deserve to make profit or is it that  with local banks we will be abled invoke non-business criteria  – family  and tribal ties, old boys network to get cheaper credit which we will dodge and duck not to repay?

See how that worked for Uganda Commercial Bank (UCB), Cooperative Bank and Greenland Bank to name the obvious ones.

The legal minds have been deciphering the case and Diamond Trust Bank will appeal the ruling.

That being said the case has raised interesting issues that will be handled in subsequent bank reforms – upping the capitalisation of banks, deepening the financial sector beyond commercial banking  among others.

On our side of the counter let us also work towards developing a culture of loan repayment. When you borrow not only from the bank reorient your mind to pay back the loan. We will save a lot of drama that way.

Oh! I see another conspiracy. When you default on a loan these days the  Credit Reference Bureau blacklists you making it difficult to borrow again or if you do, it would have to be at a higher rate.

IT’S DÉJÀ VU ALL OVER AGAIN

The event of the last few weeks took me back 20 years and a reminder that there is nothing new under the sun.

At the turn of the century we were gearing up for the second presidential race since 1986.

In 1996 President Yoweri Museveni won 74.2 percent of the vote beating Paul Ssemogerere into second with Kibirige Mayanja coming a distant third.

"It was not clear that Ssemogerere was going to run again, which raised the specter of an election where Museveni competed against himself. The NRM is rabidly averse to such a scenario. They don’t want 98 percent wins in the polls....

At around that time Nasser Sebagala – may his soul rest in peace, was back from the US where he had been convicted for passing forged checks. Before the conviction he had just become the mayor of Kampala but on his return he made it clear he was going to run for the highest office in the land. The Kampala elite smiled into their beers.

But a curious thing begun to happen. When Ssemogerere would try to have a rally it was preempted by security, but Sebagala aka Seya was running around the country holding rallies, drawing crowds and seemingly gaining momentum.

In trying to make sense of this I asked around. “We want a race. Ssemogerere is no competition so we need someone else to bring some excitement to the polls, but we know we will win them anyway” an insider told me.

In the back of my head, I thought my friend was reading too many Robert Ludlums.

I had to rethink this a few weeks later because Colonel Kizza Besigye threw his hat in the ring. To confirm my friend’s statement Sebagala’s campaign went out like a light, but not before questions were raised about his academic credentials, which had not been a problem until then.

Sebagala failed to get nominated to run for the presidency and he quickly fell in with the Besigye campaign. He of course, found time to win back his mayoral seat.

"I will be forgiven with this background in mind to look at the Robert Kyagulanyi aka Bobi Wine campaign with a jaundiced eye....

The National Unit Platform (NUP) tell the public they are a young a party – barely months old, and recent flops in the special interest group elections are down to their newness. And then without missing a beat they claim they will be the ones to run the NRM out of town, when they don’t have a presence in half the country. 

These are facts for all to see not least of all the government and its security agencies.

So then how do you explain the constant “harassment” of NUP/People Power? The narrative being sold is that the government/NRM is quaking in its boots at the growing popularity of the Reds.

Hillarious. 

There are no miracles in politics. There are no spontaneous movements that upset governments at the polls or overthrow them all together.

"Below the surface of successful movements is huge organisational structure working furiously but quietly – not unlike the duck paddling furiously under water while remaining calm above the surface

. This doesn’t need to be in offices and wheezing around in big four wheel drive cars. In today’s increasingly connected world the phone has taken over from other analogue technologies.

The Ayatollah Khomeini  returned from 15 years exile to a hero’s welcome in Iran, shutting down the largest cities in the country. Two weeks prior to his return the ruling Shah had fled into exile himself, overwhelmed by the resistance to his CIA backed rule. This groundswell of support was far from spontaneous. Khomeini’s supporters  distributed tapes of the Ayatollah drumming support for an overthrow of the Shah for years prior. The voice of the Ayatollah could not be stopped or resisted.

The point is there is a lot of work for NUP to do if it is to be in with a shout of even getting more than 22 percent of the vote in the next election.

Twenty two percent is the urban population according to the latest census.

Urban populations are known from being disproportionately loud for their size, wherever they are. And in countries, even on the continent where entrenched parties have been shown the door, it has been in countries that are more urbanised populations.

Uganda’s mostly rural population is where the action is now – the rate of urbanisation is changing that, and the one with the network to reach all of them  -- boots (literally or figuratively) on the ground, will win.

"NUP are romantic, rabble rousers, rebels with a cause nevertheless, but they will quickly learn that its dangerous to read your own press clippings....

Said another way, in the words of the 1990s band Snap, “Don’t believe the hype, It’s a sequel."