The East African (Nairobi)

14 November 2006

East Africa: Graft Costs Uganda And Kenya Millions in U.S. Aid

Washington, DC — Failure to control corruption, as determined by the World Bank Institute, has again left Kenya and Uganda ineligible to apply for hundreds of millions of dollars in additional development aid from the United States.

Releasing its findings for 2007, the US agency administering the special assistance programme ruled last week that neither Kenya nor Uganda could advance beyond the "threshold" to which they had been assigned in earlier years.

Tanzania, which had previously been deemed eligible for the Millennium Challenge Account, is not one of the three countries newly invited to begin the application process for actual aid disbursements.

No African state was chosen this year to formulate an aid "compact" with the Millennium Challenge Corporation, which oversees the performance-based programme. Moldova, Ukraine and Jordan were selected last week. They could soon join 11 countries - five of them in Africa - that have qualified for assistance through the Bush administration initiative.

"Compact-eligibility is the reward for pursuing good policies," said Ambassador John Danilovich, director of the Millennium Challenge Corporation. "These countries are now invited to begin the process of creating their compacts to reduce poverty."

Winning approval for a compact can result in substantial amounts of assistance. The 11 chosen countries - which include Benin, Cape Verde, Ghana, Madagascar and Mali - are sharing nearly $3 billion in additional aid.

Within the past two weeks, for example, the Millennium Challenge Corporation has approved a five-year, $461 million compact with Mali and an identical agreement with El Salvador.

To qualify for the assistance, a country must score well in three broad categories entitled "Ruling Justly," "Investing in People" and "Promoting Economic Freedom." It is required that a country achieve results higher than the mean in at least half the indicators included in each of the categories. A failing grade on the corruption indicator automatically disqualifies a country for assistance, no matter how well it is rated in accordance with 15 other criteria.

Kenya failed the corruption test for the third consecutive year. It would have otherwise qualified for the assistance, even though it was also given poor marks for rule of law, immunisation rates, health expenditures, and the number of days required to start a business.

Kenya received passing grades in several areas, including political rights, spending on primary education, trade policy, and inflation.

But a public row between Attorney General Amos Wako and the director of the Kenya Anti-Corruption Commission (KACC) Aaron Ringera over the competence of investigations and evidence in five cases has left doubts over the government's commitment to tackling the vice.

Coming under a barrage of criticism over the pace at which it was conducting investigation into the Anglo-Leasing scandal - the biggest fraud to be uncovered under President Mwai Kibaki, who came to power in 2002 pledging to run a clean administration - the KACC sent five files involving Cabinet ministers to the AG.

After two weeks, Mr Wako returned the files and publicly pointed out shortcoming in both the quality of investigations and evidence gathered.

The Commission responded immediately, pointing out that issues raised by the AG had been answered, but Mr Wako maintained the queries he had raised "could have been noticed even by a first year law student."

In Uganda's case, it is also disqualified on the corruption count. It was given other failing marks on political rights, enrolment of girls in primary education, and the cost of starting a business.

Like Kenya, however, Uganda would have been deemed eligible for the programme had its corruption indicator been favourable.

Kenya and Uganda are among 11 countries earlier placed in a threshold grouping that enables them to consult with US officials about how to meet millennium aid eligibility criteria. But unlike several threshold countries, the East African neighbours have not yet completed formal agreements with the Millennium Challenge Corporation on how to proceed towards eligibility.

Tanzania did win approval of its threshold proposal last year. Tanzania has also again received a passing grade on the corruption indicator and all the other criteria included in the "ruling justly" category. It was given a failing score in regard to health expenditures, girls' enrolment in primary schools, and days needed to start a business.

The news of its failure to qualify comes at a time when Uganda's political will to fight corruption is facing stern tests both at home and abroad.

An inquiry into allegations of corruption in the multimillion dollar Global Fund against Malaria, Tuberculosis and HIV/Aids implicated several officials including the three ministers in the Ministry of Health but no action has been taken against them in spite of local and international pressure to do so.

The country has been disqualified from the latest round of HIV/Aids and malaria funding from the Geneva-based programme due to its failure to bring the culprits to book.

"There are substantial problems with Uganda's existing grants," a Global Fund official told our sister newspaper, the Daily Monitor, last week. "When there is an unsatisfactory past performance, a country must address to what extent a new grant will not suffer from the same problems."

Despite having a plethora of organisations to fight corruption, including a Cabinet Minister for Ethics and Integrity as well as an Inspector General of Government, Uganda's anti-corruption initiatives have largely proved to be paper tigers that have not led to arrests and prosecutions.

Although several commissions of inquiry have been held in the country over the past couple of years - into allegations of plunder in Congo, purchase of junk helicopters for the army, and into the police force - very few recommendations have been implemented and some implicated officials continue to enjoy senior positions in government.

Opposition MPs welcomed the news of Uganda's disqualification from the Millennium Challenge Account.

"My argument is that if we are corrupt, why should we beg for money that goes into a few corrupt people's hands?" Nandala Mafabi, a Member of Parliament from the opposition Forum for Democratic Change who heads the Parliamentary Accounts Committee, told The EastAfrican on Friday. "Our first task is to fight corruption."

Additional reporting by Herbert Benon Oluka

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