New Vision (Kampala)

3 June 2010

Uganda: Economy On the Rise, But More is Needed

editorial

Kampala — On Wednesday President Yoweri Museveni delivered his State-of-the-Nation Address at Parliament. The address coincides with the opening of a new session - the fifth and final of the eighth Parliament.

Museveni's speech emphasised the economy. He reported that the economy which stands at $18b (sh36 trillion) has speeded up over the last five years to an annual average growth of 8.4%. At that rate, the economy will double in size within the next nine years.

He said the exports of goods and services were up, as were foreign remittances - Kyeyo money, rebounding after the global financial crisis.

He also put Uganda's revenue collections in perspective by showing they had grown a thousand-fold since 1986 to above sh5,000b this year.

There can be no doubt that Uganda's economy is continuing on its prodigious growth path. But this economic growth is being enjoyed by a relatively small population centered around the urban areas.

An inability to distribute the growth equitably is a failure of the Government more than anything else.

The components of economic growth are consumption, government expenditure, investment and the net foreign trade flows.

The Government cannot and should not try to improve Ugandans' welfare by dishing out money. But the distribution of this growth will be better enabled by improved government service provision in health care, education, infrastructure development and other public goods.

It is no secret that the Government's service delivery has been found wanting and this is not for lack of money.

Corruption is short circuiting service delivery and the Government should focus more on this malaise by directing adequate resources at the law enforcement agencies.

It is conceivable that Uganda will continue to post fantastic growth figures, but for as long as corruption is allowed to fester, this progress will be the preserve of the urban elite.

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