A Ugandan "businessman" called David Senfuka recently went to President Yoweri Museveni with a proposal. He told our president that he (Senfuka) had invented a medicine that cures cancer and diabetes. He added that the world's richest man, Elon Musk, had offered him $50 billion to buy his patent, but Senfuka refused. Being a great nationalist, Senfuka wanted his invention to be produced in Uganda and owned by him, a Ugandan, not an African American upstart called Musk - (Musk was born in South Africa). He then suggested to the president that the government of Uganda give him capital worth $1 billion to build a world-class pharmaceutical plant in our country to produce these cancer and diabetes drugs.
Now Senfuka is not a businessman. I have talked to the people who know him, and without exception, they have told me that he is actually a conman. Besides, they have added, this great Senfuka is, in fact, not an educated man; he has perhaps completed primary school only. But like all conmen, he has great wit and knows best how to sell stuff. "He can even sell refrigerators to the Eskimos (Innuits)," one person who knows him told me. Museveni bought the story and ordered the government to find billions for Senfuka to build his pharmaceutical plant in Uganda. Some people tried to dissuade the president against throwing public money at this scam, but he wouldn't listen. Senfuka's claim may soon be cashed.
Yet Senfuka is not the only one to sell tall tales of groundbreaking and highly innovative inventions to Museveni and win a "lottery" from the financially crippled state of Uganda. Another "businessman", a one "Dr" Matthias Magoola won his own lottery from Museveni and has even cashed it. Claiming to be a doctor, perhaps a witch doctor, Magoola is the founder and managing director of Dei Pharma, which the AI of Google, Gemini, calls "a major pharmaceutical and biotechnology company aimed at revolutionizing healthcare in Africa". Apparently, Magoola's "company" is going to produce mRNA, cancer, malaria and HIV drugs in Uganda.
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With this tall tale, Magoola convinced Museveni to force the government of Uganda to give him Shs 735 billion ($200m) for this venture. Part of this money was supposed to clear a debt he owed Equity Bank worth Shs 250 billion. Instead, Magoola colluded with people at the ministry of finance. So, when money to clear this loan was released, it was sent to one of the multinational banks in Uganda, not Equity. The bank thus remained with a huge non-performing loan, which led to the firing of its CEO, Athony Kituuka. Magoola had once been arrested in India for fraud. This is the man the president trusted with public money worth Shs 735 billion to build Dei Pharma.
Now last month, March 9th, the president, during a heated meeting, literally forced cabinet to approve another $430m (Shs 1.6 trillion) for Magoola. I am reliably informed that when officials said the government did not have money, the president said angrily, "borrow it." And so, the decision went through. Magoola's $630m lottery from the government of Uganda is not unique. Enrica Pinetti got $376m (Shs 1.4 trillion) to build a hospital in Lubowa that Uganda does not need and cannot afford. Of this, Shs 925 billion was the money to build and equip the hospital; the balance was interest on the loan. Every expert I talked to and all other comparative projects showed that Uganda could have built and equipped Lubowa for one third of that money. But Museveni forced cabinet to accept it.
Projects of this type have proliferated in the last few years. We pumped Shs 200 billion into Roko after the company went bankrupt. Then we have invested $89m (Shs 400 billin) into a coffee plant owned by my friend Nelson Tugume in Ntungamo. Last month, the president got cabinet to approve another $79m (almost Shs 300 billion) as extra cash for this company. Then we have given Atiac Sugar Company, owned by my other friend, Amina, Shs 560 billion to produce sugar. I question the economic value of these projects, most especially the concentration of so much money in these few projects.
Even if these investments were good, the risk concentration is too high. The Ugandan government had, in the 1990s, adopted a policy of avoiding state involvement in the economy. In many ways, this policy was not good for a developing country which needed industrial policy to drive manufacturing. Such a policy would ensure the state helps raise capital to finance investment in manufacturing - directly as a productive agent in its own right, as in Kiira Motors, or as a source of venture capital for the private sector. Under such a policy, the prudent thing is to support many small startups, not a few big ones, as we are going right now. If Magoola and/or Senfuka fail, the loss to the country is huge. But if the money they were given was spread over 1,000 startups, the chance that 10% of these will succeed and become the next Apple or Huawei is reasonably high.
This brings me to the choice of the title of this article. Museveni has grown old. He has become less able to rigorously assess the economic and business viability of the ideas and projects sold to him by the myriad wheeler dealers who surround him like vultures do an animal carcass. Worse than that, when he has made up his mind on these proposals, he is less inclined to listen to contrary views and opinions. At 81 years and having worked all his last 40 years under conditions of extreme pressure, the intellect is giving way to stubbornness. As a result, project proposals of clearly dubious value get his approval without guardrails within the state to protect the national interest of the country.
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Many Ugandans close to power have learnt this lesson. That the president is old and exhausted, both intellectually and physically. He has a limited ability to monitor many things across a large spectrum of sectors. So, they front individuals who sell him projects of dubious value, get blue letters instructing the government to release huge sums of money for these projects, then they earn huge commissions from them, and nothing happens. Because the persons involved are close to the president, they know that Museveni is disinclined to fight many wars at multiple fronts given his advanced age. Seeing that he is being duped right, left and centre by those closest to him, he just abandons the struggle. That is the state of Uganda.
