Home News Full speech: Museveni slams World Bank over loans

Full speech: Museveni slams World Bank over loans


Ugandans and, especially the Bazukulu.
Further to my message of the9thAugust, 2023, I would like to reiterate that foreign aid and loans are welcome and can be of some use if designed and executed by patriots (not neo-colonial agents) but are neither decisive nor indispensable elements for our desired social-economic transformation.

On the contrary, those loans and aid packages can be a source of distortion and stunted growth as you can see across Africa. If foreign aid and loans are a source of social-economic transformation, why the present growing crisis of even security and stability in Africa?

Look at Guinnea-Conakry, Mali, Burkina-Faso, Niger, Central African Republic, DRC, Boko Haram in Nigeria, Somalia, Mozambique, etc. Most of these Countries have been getting those grants and loans.

Many of the loans and aid packages, are either of no value addition to the Country or are even anti-growth, all together. In the Ministry of Agriculture, Animal Industry and Fisheries, for instance, we discovered that a total of USD 800million had been borrowed over a period of ten years, but that Ministry did not have zonal diagnostic labs and Research centres, did not repair the mechanization centres and did not buy the mechanization equipment like combine harvesters or even tractors, no irrigation equipment for farmers, no value addition equipment, etc.

Much of that money was spent on seminars etc.; yet, those are the basic requirements of that Ministry, if it is to assist in the struggle for Social-economic transformation.

Therefore, most of the borrowing has been having no value addition to our transformation journey. Besides, in some cases, the aid policies are directly against growth. Uganda has been manufacturing ARVs and other medical drugs at our Quality Chemicals factory in Kampala -Luzira.

The Aid givers from abroad, for a long time, were not allowing us to use their money to buy the Ugandan manufactured drugs. To qualify for aid, we had to forget our own industrialization and job creation for our people and support, our Kujanjabisa (getting treatment), and the jobs creation for other people.

Who, then, permits the signing of such distortion-causing agreements to our economy? It is the neo-colonial lobby in the Country behind my back. That is why, on the 19th of June, 2017, I wrote a directive forbidding the contracting of more loans without my express approval.

We used Uganda Government money, to do that portion-Shs. 440 billion. Another actor abandoned doing the Kampala-Mityana portion at the last minute(kokonyo, kunegura), an act that is very offensive among the communities of this area.

We did it with Uganda Government money. Some group was funding Kamwengye -Fort-Portal road and the work was being done by a Chinese Company and a Chinese man slept with a local girl in some circumstances. The project was stopped !!.

We funded it and the road was finished. If you really want the country to undergo a transformation, you must support the lowering of the costs of electricity, transport (the railway and water transport) and the cost of money in banks for the private sector and commercial operators to have good profits.

Baroness Lynda Chalker helped me with Nalubaale and I saluted her. The Chinese have helped us with Isimba, Karuma and they had offered to help with the Standard Gauge Railway.

It is these areas that can quickly help to transform the economy. We salute the World Bank and some other actors for supporting the social infrastructure (health and education), in spite of the erraticness and frivolity. However, there is a fundamental disequilibrium here.

If you support the social sectors, but you do not support the railway, the electricity and the cost of borrowing, how will money-making enterprises grow? If the money-making enterprises (factories, hotels, etc.), do not grow, who will employ the school leavers? Hence, the problem of unemployed graduates.

13 That is why the Uganda Government, creates funds like the Youth Fund, the Women Fund, the emyooga, the PDM, funding UDB, the Innovation Fund etc. Therefore, all along, we move with some partners even when we are not fully aligned on the basis of: “Entajugirwe nyoko, kwobona ekirengye, oti nariire”-“a hoof of a cow that is not your mother’s bride price is good enough.” In any case, it is us to develop our country and that is why most of the 5 factors have been put in place by us. “Enyongyeserezo, teba mbi” -“Any addition to what you have, is not bad.

”Therefore, the World Bank and other external actors, have no capacity to interrupt our transformation journey. It is actually the internal weaknesses, that delay our forward march and that must and will be crushed. The internal weaknesses are two: the neo-colonial misplanners that have been historically manning the civil service and also present in the political class on account of the neo-colonial social sciences taught in the educational system; and the corrupt parasites in the same groups that delay the operations of the private sector or demand bribes from them. The mis-planners who see no problem with Africa, Uganda included, only produce raw materials.

Yet, in Economics, we used to learn about the concept of Opportunity Cost -meaning what you lose by not doing or doing something. What is the opportunity cost of Africa only producing raw materials? This is why the performance of African economies, is miserable.

Here below, are the economies of some of the countries compared to that of the massive continent of ours: United States of America-$26.9 trillionChina-$19.4 trillionJapan-$4.4 trillionGermany-$4.3trillionIndia-3.7 trillion Africa -2.9 trillion(source IMF 2023)This is a big shame and the cause of the chaos in Africa: wars, hunger, African children dying in the Mediterranean Sea, our children going for kyeyo jobs etc. In the case of Uganda, we rejected this formula from the student days of our Movement, but we have been having internal opposition from the two groups and we also started from a very low base.

Nevertheless, using a realistic approach, we have been operating with the neo-colonial actors within our Public Service while, at the same time, using the growing capacity of Uganda’s economy in promoting our own patriotic agenda and we have succeeded in the following sectors: i. Fisheries -12 factories, they had gone up to 22 but bad fishing undermined some;

The Maize sector-5 million tonnes from500,000 in 1986; iii. Cotton -2 factories, processing 20 million metres of fabric per annum. iv.Milk -5.4 billion litres per annum from 200 million in 1986 and 145 factories. v.Tea -23 factories processing 82 million kgs of tea per annum; vi.Coffee-8million, 60kgs from 2million;vii.Cement-6 factories, processing 4.6 million tonnes;

16viii.Steel -19 factories processing MT510,700 tonnes per year from scrap -now going for vertical integration with our iron ore (obutare) to produce fresh steel; ix. Ceramics factories-2 factories; x.Commercial explosive factories; xi.Wood products factories -furniture, ceiling boards, etc.; xii.Military Industries; xiii.Pharmaceutical industries; xiv.
Gold refinery; etc, etc. Then, food production is supported by our Research Institutions for seed development and development of breeding materials. That is why our inflation is now 3.9% in spite of the global turbulence. If you now scrutinize carefully, you will find that these success areas and the ones I have not listed, are, mainly, on account of the other 5 factors of growth and transformation promotion, that I have mentioned above that are, mainly, endogenous and not exogenous. Therefore, the illusion that external aid can cause or prevent

social economic transformation, is, indeed an illusion. The Bretton Woods aligned Ugandans (Mutebile, Muhakanizi, etc.), somehow contributed to our recovery by emphasizing the use of market forces such as liberalizing the foreign exchange rate to find its own level instead of the mistake of the Bank of Uganda arbitrarily fixing the rate, allowing prices for consumer and producer goods to rise and fall according to the laws of demand and supply instead of the Government fixing prices or using subsidies, etc.

These free market stimuli, brought discipline and realism to the small enclave colonial economy of the 3Cs and 3Ts (Coffee, Cotton, Copper and Tourism, Tea, Tobacco) of 1962 that, moreover, Idi Amin had destroyed. These free-market stimuli, help those who are already in the money economy to act realistically. It does not, however, address the three big strategic bottlenecks that confront underdeveloped economies. These are: confining one selves to producing only raw materials and being import agents of foreign products; neglecting the crucial economic infrastructure that could lower costs in the economy by not building the railway and electricity and only partially and with a lot of frivolity working on the social infrastructure (health and education), and ignoring the huge populations that were in the non-money economy (68% by 2013) that are not aware and cannot respond to the market forces.

Sstimuli. When I was commercializing the fish sector, I had no support from the system. When I was mobilizing the traditional pastoralists in the Cattle Corridor into the Commercial Dairy Industry, the system was either indifferent or even hostile to my efforts.

Hon. Victoria Ssekitoleko helped me with the maze. With the banana flour, the vaccines, etc., I am always infight with the neo-colonial system. I first saw Prof. Muranga’sbananainnovation at the Lugogo showground in 1997. It is only recently, that I have been able to force the powers that –be, to fully and, finally, fund that project. How about my battle for the value addition for Coffee? See my letter to Hon. Mayanja Nkangion the value addition to our produce dated 12th November 1997 on this issue.

Our innovation and wealth creation funds have been from our money. I do not remember any external funding for them. The market stimuli our Bretton Woods group rely on so much and erroneously, are known as “macro-economic stabilization”. They also exaggerate and refer to that formula as “structural adjustment”. There is nothing automatically “structural” in that macroeconomic stabilization.

You can actually become stagnant and, eventually, decline and collapse as so many clients of this formula have done in Africa. This is where the NRM firm’s philosophical, ideological and strategic position, saved Uganda.

We said: “Yes, macroeconomic stabilization is useful provided you also work on the qualitative leap from raw –materials to finished goods and you also use mobilization to get the bystanders of the traditional, non–money economy, into the money economy.”That is why Uganda under the NRM is an unsinkable ship in the stormy global sea of the world economy. It may be useful to remember the words of Dr Mutharika, himself a former worker of some of those international bodies when he became President of Malawi.

He said that he wanted “a Malawi economic plan supported by the World Bank” and not “a World Bank programme for Malawi”. The Ugandans should not waste time on it. Instead, we should launch a merciless war on the two internal inhibitors of our own: the corrupt and the neo-colonial planners. It is high time, the two got off the scene completely.

They have delayed us enough. Finally, the provocations by the World Bank and the thoughtless homo-sexual lobby, should not provoke us into being, automatically, anti-Western. Even in colonial times, we had supporters in the West in our anti-colonial struggle: Sir Dingle Foot, Lord Fenner Brockway, Olof Palme, etc. Even today, there are many friendly forces in the West, but they are intimidated by these disorientedlobbies. Our firm resistance to the wrongdoers assists them.

Our Western partners, however, should also know that the reckless actions by some of these elements could interfere with the fundamental interests of the citizens of the World in, for instance, fighting against terrorism and chauvinism of different types (religious, etc.). We have been cooperating in fighting terrorists in Somalia, Eastern Congo, on the Sudan border in the past, etc.

By Yoweri Kaguta Museveni

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