Charles Byaruhanga
9 November 2009
opinion
On October 9, Uganda celebrated her 47th independence anniversary. Most Opposition politicians didn't attend because national celebrations have turned into the NRM party functions where functionaries wear yellow outfits and dry banana leaves to signify support for the nth term for President Museveni.
In addition, President Museveni's message has not changed in several years. It includes blaming the Opposition for the shortfalls of his government, the "commitment" to fight corruption and giving statistics to portray that the NRM government has registered an impressive economic growth.
What intrigued me most on this occasion was for the President of an agrarian economy, whose comparative advantage is in agriculture, to applaud the decline in contribution of the sector to GDP. While he acknowledged that agriculture employs about 70 per cent of the rural population, he said the economy has been transformed into a modern one that is driven by services and industry sectors with a momentum of growth compared to economies of India and China.
President Museveni, like other proponents of the 'abandon agriculture' school of thought, think that reliance on industry and services sectors are more likely to be successful in promoting economic growth. This is not the case because such growth will only be in limited locations and leaving out majority of people and areas undeveloped. This can't achieve "Prosperity for All" because available literature reveals that growth in agriculture is an important ingredient that connects economic growth to the poor. In an agrarian economy, agriculture plays a big role in reducing poverty.
No country has been able to sustain rapid transition from poverty without raising agricultural productivity. Poverty has become rampant because agricultural sector lags behind largely due to inefficient farming practices, dependence on rain-fed-agriculture and poor transport and distribution channels. This shows why the gap between the rich and poor has grown wider despite the much hyped economic growth. The gap arises from planning mismanagement, owner inefficiencies and the rampant corruption under the NRM government.
The industry and service sectors can't achieve prosperity without simultaneously transforming the agricultural sector. In an economy where agriculture is the main productive sector, rapid growth will not occur unless agricultural productivity improves. The most compelling evidence comes from comparing Africa and China. China's poverty rate fell from more than 50 per cent in 1981 to about 20 per cent in 1991 and 5 per cent in 2005. In 1981, China's poor outnumbered Africa's by almost 4:1 yet by 1996, sub- Saharan Africa had more poor people than China. Between 1991 and 2004, 500 million Chinese moved above the poverty line whilst 130 million more Africans moved below the poverty line.
In the 1960s, Uganda was one of the most promising economies in sub-Saharan Africa. It is now among the 20 poorest countries in the world with per capita GNP of $279 compared to $724 for India and $1736 for China. Increase in economic growth in China began with a sharp rise in GDP in the agricultural sector and reduced poverty to less than 3 per cent. It is therefore intellectual dishonesty boast of statistics which can't be translated into welfare of the population as a great achievement.
As a progressive rancher, President Museveni is one of the richest in Africa (as reported in the Orumuri of the week ending October 26). Instead of emphasising industrialisation at the expense of agriculture and national wealth at the expense of welfare of people who can't participate in growth without increased agricultural productivity, he should be championing agriculture. It is the sector that creates jobs and incomes to help the wider economy grow by boosting demand for local goods and services.
Although no poor country has successfully reduced poverty through agriculture alone, none has achieved it without first increasing the sector's productivity. Stagnating agricultural productivity therefore slows economic growth and exacerbates poverty. My appeal to government is to increase spending in infrastructure and services that support private investment in agriculture if we are achieve prosperity for all.
Mr Byaruhanga is a management consultant and policy analyst
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