On the 19th of April 2010, Uganda launched a New Development Plan.
Since 1997, the Poverty Eradication Action Plan (PEAP) has been Uganda's national progressive policy development framework and medium term planning tool as advised and crafted by the World Bank and International Monetary Fund (IMF). The New Plan is a complete departure from the Washington consensus. What could be the reasons for this departure? Could this also be a precursor of other new changes including a new foreign policy as well and new partners in development? Could it be another form of a presidential manifesto as early preparation for next year's general elections?
The country has been praised as a success story in macro-economic stability, rapid economic growth and privatization of the economy. Until now, the government has been publishing statistics showing rosy achievements and projections that promised better days, with the endorsement of multi-lateral financial institutions. The use of the term "new" is suggestive. Part of this plan projects that within a few years, Uganda shall be a middle income country with an average per capita income of $850, have well paved roads, modern airports, a thriving railway transport system, an effective city bus service, and an economy growing at 8% per annum.
At the launch of the New Development Plan, Mr. Longino Tisarana, the National Planning Executive Director, said that the plan will transform Uganda to a "middle income and prosperous country." The plan appears overly ambitious, given the prevailing circumstances. A case in point is the strategy for instance to generate at least 3,000 megawatts (MW) of electricity by 2015. Currently the country generates 500MW. When the Bujagali power plant is completed as expected later this year, the generation will rise to 750MW. The plan certainly offers excellent reading. A number of scholars and the donor community applauded the plan but cautioned on accountability and transparency.
During the launch, President Yoweri Museveni blamed the donor community for giving poor advice to the government which he blames for the country's slow development pace. This is certainly bold coming from a Head of State whose country's National Budget is 30% donor funded. Could this be an indicator that the country will get new partners in development and will no longer heed the advice from the World Bank and IMF? Uganda seems to be taking a leaf out of the book of the best practices of the Asian Tigers who were similarly caught up in poverty and underdevelopment but managed to get out with little assistance from the World Bank and IMF.
A number of factors could be responsible for this change of policy. These range from: the recent discovery of heavy oil deposits in the country; restoration of peace in most parts of the country; little evidence to show for sustained development under the World Bank and IMF models and the coming presidential elections. It is said that Uganda has the potential of earning a staggering Shilling 21 billion in crude oil per day. Should this be the reality, then the country will not only be able to support its national expenditure without donor support but also the NDP ( New Development Plan) may cease to be plan on paper. Of course this will only be possible if the issues of corruption and accountability are addressed with corresponding zeal. The world over, resource discoveries have implications for any economy. The effect could be for the good or for the bad.
Perhaps the recent visit to the country by President Mahmoud Ahmadinejad of Iran was quite timely for both countries. Among the countries scrambling for the oil industry in Uganda, including China, it is only Iran that advised Uganda to build an oil refinery. Again, following the discovery of Uranium, Uganda wants to boost its energy generation based on nuclear power.
During his visit, President Ahmadinejad said that the cost of producing 1,000MW of electricity by burning fossil fuels is ten times more than using nuclear to produce the same amount of energy. The statement appears to have impressed President Museveni. The President has always talked about increasing the amount of energy generated as a core strategy of reducing the cost of conducting business, thereby improving Uganda's competitiveness in attracting investment. Tehran expects the new friend to return this gesture of friendship as a sitting member of the UN Security Council by voting against sanctions being floated by the US against Iran for allegedly planning to make nuclear bombs under the guise of producing nuclear based energy.
It should also be noted that for the first time in several decades, the country is experiencing increasingly relative peace within its borders and is not at war or in a state of war with any of its neighbours. This is further complimented by the return of relative peace in the Great Lakes Region. With peace returning in the north of the country, a large chunk of fertile land, human resources and social economic infrastructure that have been out of bounds for the last two decades, will now come into use. Similarly the Karamoja region is likely to witness more economic activity with the gradual decline in cattle rustling as a positive outcome of the ongoing disarmament exercise. Certainly increased human security is one of the key ingredients necessary for sustained development.
The launch of the plan marks the return of Keysian model of State demand management. However drawing up a plan to mimic the success of others is the easier part of the process, the challenge is to execute it. To implement the plan, new development partners are likely to come on the scene. The timing of the launch of the plan begs the question as to whether the presidential manifesto will be different. Indeed, the plan has brought with it very ambitious projects on a scale hitherto unknown. Will it achieve what it claims to by 2015 or is this mere rhetoric? The plan in itself is excellent. However as the New Vision newspaper put it, it would require "champions with evangelical zeal" to see it come to fruition.
Written by: Erasmus Twaruhukwa, Senior Legal Advisor, Mifugo Project, ISS Nairobi Office