Stop sloganeering over peripheral issues called “governance” and seriously think about our strategic challenges
I have a frustration with President Yoweri Museveni’s Uganda: even after 30 years of impressive economic growth rates, Uganda is still far from any significant transition from a backward rural agricultural society to a modern urban industrial economy. Nearly 80% of Ugandans still depend on agriculture for a livelihood and live in rural areas. Industry employs only 8% of our people while services employ 12%.
Because of investment in universal primary and secondary education and rapid expansion in access to tertiary education, especially university education, Uganda is producing large numbers of educated and increasingly urbanised youths who cannot find jobs. The limited capacity of our economy to foster structural transformation is largely because much of the growth has been driven by low productivity sectors like services.
Since 1986, growth in agriculture has been by increasing the number of hands holding a hoe and by putting more land under cultivation i.e. no productivity (output per unit factor input) growth. Manufacturing grew at a rate of 14.34% between 1986 and 2000. Between 2000 and 2015, it grew by 5.68%. From 2005 to 2015, it grew by 4.97%. Since 2012 it has averaged 4%. The main engine of growth since 2000 has been services averaging 7.2%.
Before opposition activists can jump onto this point to score political points against Museveni, I must add that this problem bedevils all African countries with the sole exception of Ethiopia. It has been occasioned by the influence of international financial institutions over public policy in Africa. And given the centrality of manufacturing to transformation, Uganda’s (and Africa’s) challenge is therefore how to stimulate this sector. The advantages of manufacturing are obvious. It creates large scale jobs for the less skilled. So it has capacity to absorb hundreds of thousands of our youth graduating out of universal primary and secondary education. It has high potential for growth in labour productivity compared to services or agriculture. How does our country address this challenge?
The opposition in Uganda claim we need “good governance,” a cliché that has become fashionable and involves fighting corruption, holding free and fair elections, building “effective institutions,” respecting human rights, etc. This hotchpotch of ideas was started by the World Bank in its 1989 report titled Sub-Sahara Africa, From Crisis to Sustainable Growth. It has been peddled by Western academics and regurgitated by their politicians, diplomats and journalists. It has infected African elites and “intellectuals” involved in public debates like a plague.
Anyone who takes thinking seriously and cares to study the history of developed nations would easily see that what is called “good governance” is a consequence of development, not a cause of it.
If “good governance” was a precondition for transformation, the world would not be having a single developed country. The Western world transformed through a very brutal process involving slave trade, slavery, piracy, brigandage, genocide, colonialism, world wars, cruel labour practices, apartheid, etc. – what Karl Marx called “primitive accumulation of capital.”