Uganda: Museveni Rejects Move to Halt Bank of Uganda Investigation

Uganda President Yoweri Museveni (file photo).
5 December 2018

Kampala — President Museveni on Monday rejected attempts by Cabinet to halt the ongoing parliamentary probe into the operations of Bank of Uganda (BoU) and the circumstances that prompted the bank to close seven commercial banks amid concerns that bank officials flouted laws.

Sources familiar with proceedings from the Cabinet meeting at State House Entebbe say Finance minister Matia Kasaija tabled a motion calling for Cabinet to halt the inquiry.

Mr Kasaija reportedly argued that the probe may lead to capital flight while also scaring away potential Foreign Direct Investments (FDIs) with investors uncertain about the status of the central bank.

As an alternative to the inquiry, Mr Kasaija reportedly proposed that a meeting be convened between BoU, the Finance ministry and MPs on the Committee on Commissions, Statutory Authorities and State Enterprises (Cosase) to get to the bottom of all the issues relating to the central bank's woes.

Mr Kasaija's proposal was rejected by his colleagues, who insisted that the inquiry be allowed to proceed but with a caveat that the committee expedites it because the longer the probe drags on, the more the image of the central bank is tainted.

Only Government Chief Whip Ruth Nankabirwa reportedly supported the proposal.

President Museveni revealed that BoU officials had lied to him about the financial status of the closed banks and gave the green light for the committee to proceed.

Asked about his presentation in Cabinet, Mr Kasaija responded: "Who said that? Don't waste my time. That is nonsense," and quickly hung up.

Ms Nankabirwa admitted that Cabinet discussed the matter but said she did not move a motion to foil the investigations but only contributed to give clarification.

MPs heard that former BoU director for banks supervision Justine Bagyenda closed Global Trust Bank and sold it to dfcu in 2014 within a day without procurement guidelines.

Cosase's take

Committee chairman Abdu Katuntu said the country has tough choices; either to keep a blind eye on the irregularities at BoU until they get into a full blown crisis or allow the inquiry to expose and fix them before it is too late. "Based on what has already transpired, Cabinet should be the first to let the processes go on. This country has one central bank, whatever happens to that bank hurts the economy. If there are challenges, they should be addressed," Mr Katuntu said.

[email protected]

See What Everyone is Watching

More From: Monitor

Don't Miss

AllAfrica publishes around 600 reports a day from more than 140 news organizations and over 500 other institutions and individuals, representing a diversity of positions on every topic. We publish news and views ranging from vigorous opponents of governments to government publications and spokespersons. Publishers named above each report are responsible for their own content, which AllAfrica does not have the legal right to edit or correct.

Articles and commentaries that identify as the publisher are produced or commissioned by AllAfrica. To address comments or complaints, please Contact us.