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The Presidency

Presidential Committee recommends urgent and comprehensive sweeping Central Bank reforms

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The majority of the senior staff members interviewed by the committee said there were factions or cliques in the Bank polarized around the positions of the Governor and the Deputy Governor.

A committee appointed by President Yoweri Museveni to study several complaints made to the Inspectorate of Government and Parliament about Bank of Uganda, has recommended “urgent and comprehensive review” of what it believes is an archaic “legal regime governing the Bank of Uganda.”

“The Bank of Uganda Act Cap 51 was last amended in 1993, two years before the promulgation of the 1995 Constitution of Uganda. In the case of the Bank of Uganda by-laws established under Statutory Instrument 51-1, the situation is even worse as they were passed in 1968 and continue to be applied despite being inconsistent with the Constitution in some important respects such as the authority of the Governor versus the authority of the Board,” reads part of a leaked Confidential Report of the Presidential Tripartite Committee to the President.

The committee was formed by the president to partly investigate numerous allegations surrounding a decision taken by the Governor of Bank of Uganda, Prof Tumusiime Mutebile on 7th February 2018 to fire then Executive Director of Bank of Supervision, Justine Bagyenda.

The governor also made several staff transfers and made new appointments from without BoU to several senior positions. This included Dr. Twinemanzi Tumubweine who replaced Bagyenda.  As a result of the Governor’s communication complaints were made to the Inspectorate of Government and the Parliamentary Public Accounts Committee on Statutory Authorities and State Enterprises (PAC-COSASE) challenging the legality of the governor’s decisions.   

The Committee conducted interviews, document reviews and benchmarked the central banks of Kenya, Indonesia, South Africa and Rwanda. Various staff of BoU as well as current and former Board Members and Hon. Matia Kasaija, Minister of Finance, Planning and Economic Development were also interviewed.

In total, 74 people were interviewed.

Mutebile defends his decisions

In his defence, the governor said that the appointments were in in accordance with Section 28(4) of the Bank of Uganda Act and the by-laws created thereunder. He referred to Section 28(4) of the Bank of Uganda Act which provides that “except as may otherwise be provided in the by-laws of the bank, all appointments of employees shall be made by the Board. The Governor then went on to refer to Sections 8(2)(a) and 8(2)(e) of the by-laws of the Bank created in 1968 which he said entrusted the Governor with the responsibility of organization and management of the Bank as well as ensuring proper discharge of duties of the other officers and other employees of the Bank.

Hon Paul Mwiru (MP, Jinja Municipality East); he together with Hon Michael Mawanda (MP, Igara East) said they were in the process of drafting a private member’s bill seeking to amend the Bank of Uganda Act so as to effect various recommendations to reform the central bank by the Parliamentary Public Accounts Committee on Statutory Authorities and State Enterprises (PAC-COSASE)

“In this particular case the governor made reference to responsibilities attributable to his office as Governor under the by-laws and yet the same responsibilities were constitutionally attributable to the Board of Bank of Uganda. A review therefore needs to be urgently undertaken and the Bank of Uganda laws (by-laws) brought into harmony with the Constitution along with any other matters necessary for the stability and smooth functioning of the central bank,” recommended the 8-member committee in their February 2019 report.

Although the committee did not reverse the decisions of the governor, it noted that the gaps in the legal regime governing the set up and running of the central bank “created a complicated situation from a corporate governance point of view whereby the Governor made a decision as a Chief Executive and yet also assumed the role of the Board within the same decision.”

It is for this reason that the committee recommended a “splitting or separation of the functions of the Governor and the Chairperson of the Board especially with regard to administrative matters”, noting that “most of the problems caused as a result of the Governor’s decision could have been avoided if the two roles were separate with no opportunity for the Governor to function as both Board and Chief Executive Officer.”

Growing voices to reform BoU

This latest recommendation adds weight on an earlier recommendation by MPs on the PAC – COSASE probing Bank of Uganda who also recommended amendment of Article 161 (4) of the Constitution that provides that the Governor and deputy Governor shall be Chairperson and Vice Chairperson of the Board respectively, so as to ensure “objectivity of the Board and its independence from management.”

Recently, two members of Parliament, Michael Mawanda (MP, Igara East) and Paul Mwiru (MP, Jinja Municipality East) said they were in the process of drafting a private member’s bill seeking to amend the Bank of Uganda Act so as to effect the above recommendations.

The MPs said this was because government has, despite promising to respond to the PAC-COSASE report in 90 days, has to date failed to act, more than 120 days later.    

Several other experts, including Mr. Onegi Obel, an economist and capital markets expert, as well as economists and researchers Dr Fred Muhumuza and Dr Patrick Wakida, have previously called for a review of BoU’s powers in the face of recent failures.

More proposed reforms

The Committee also recommended that a new additional position of Deputy Governor be created to unburden the governor, who they said was “too overloaded in terms of responsibilities” some of which risked “exposing the position of Governor to unnecessary controversies.”

“It may therefore be prudent to consider the creation of an additional post of Deputy Governor, which Deputy shall largely be responsible for the general administration of the Bank while the Governor and the other Deputy are free to concentrate on the core functions of the Bank as stipulated in the Constitution,” recommended the committee.

The committee further recommended that there should be periodic individual-focused appraisals of the performance of all the Board members including the Governor. Relatedly, the committee also wants the Bank of Uganda Act be amended to operationalize Article 161(5) of the Constitution to provide for legal provisions which a President may rely upon to set in motion, the process of removal of any of the Board members including the Governor and Deputy Governor.

They also called for a review of BoU’s administration manual to clarify ambiguities surrounding entry requirements and job descriptions.

Regarding human resource management, the committee called for the removal of the board from direct involvement in recruitment. They also want the process of internal promotions reviewed while the ratification of externally recruited persons is outsourced.

It is not clear when the president received the report, but in a recent interview with NTV, then, acting Information minister, Dr. Chris Baryomunsi said that cabinet has considered the PAC-COSASE report and will be able to give a report on the progress so far in addressing the COSASE recommendations in the coming weeks.  

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Finance

Oil Money will not be for Consumption or even Salaries – President Museveni

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President Yoweri Museveni while speaking at the Uganda – Tanzania Business Forum

President Yoweri Museveni has echoed that Uganda’s cash from the oil resource will not be used for consumption or even salaries to civil servants.

The President made the remarks on Friday while addressing the business community attending a 3-day Uganda-Tanzania Business Forum 2019 at the Julius Nyerere International Convention Centre in Dar-es-Salaam, the Tanzanian capital. The First Lady and Minister of Education and Sports Hon. Janet Kataha Museveni was among other cabinet ministers and private sector officials at the forum.

“Under my leadership, the money from oil will not be used for consumption or salaries. Why? Because it is a resource that is exhaustible and finite. One day there will no longer be oil. That is why I insisted that money from these resources should only be used to create durable capacity for the Ugandan economy namely; build power dams, irrigation schemes, the railway, scientific innovations and some aspects of education,” he said.

The forum is the first of its kind and was the initiative of the partnership of Tanzanian Private Sector Foundation (TPSF) and the Private Sector Foundation of Uganda (PSFU). It aims at offering a platform for the business community to share experiences, explore investment opportunities across borders, create business to business networks, identify and discuss challenges in the presence of the Heads of State and Government Ministers and policy makers.

The forum also lays emphasis on issues relating to the steps that can be taken to address and overcome the bottlenecks to the thriving of the bilateral trade between Uganda and Tanzania. Earlier, President Museveni and his Tanzanian counterpart, John Pombe Magufuli were conducted on a guided tour of exhibition stalls in which Ugandan companies and government ministries including Uganda Airlines, Uganda Investment Authority, Uganda Railways Corporation, Kakira Sugar Works, Stanbic Bank, National Social Security Fund, NITA, UCC, Ugandan Petroleum sector, the Ministry of Energy, and the National Oil Company, among others, showcased what they offer.

President Museveni said he is interested in learning the conclusions of the forum on topics relating to the attractiveness of the 2 countries as destinations of investments, harmonisation of the strategies and partnerships in the emerging data economy, trade and infrastructure, reducing the cost of doing business between Uganda and Tanzania and the local content as a key to the unlocking of the long term value in extractive industries.

The President and his host concurred on the plan to enhance water transport from the Port of Mwanza in Tanzania to Port Bell in Uganda adding that railway transport between the two countries would go a long way in promoting sustainable trade and investment between the two countries. Mr. Museveni revealed that the East African governments are working aggressively on power saying that in Uganda today total power generation will soon be 2,000 megawatts which will ensure reliable power supply transmission and the lowering of power costs for manufacturers.

President Magufuli described the 1st business forum between Uganda and Tanzania as a historical occasion. He thanked the organizers for effecting the forum and President Museveni for honouring it with his presence. “The cooperation between Uganda and Tanzania has been in existence since time immemorial even before colonial time. The borders cannot separate us. We shall continue working together in development,” he said.

He stressed that it was important for the two countries to strengthen their cooperation in development drawing on the potential of their own natural resources in the sectors of agriculture, tourism and manufacturing. President Magufuli revealed that to ensure faster movement of people and goods between Uganda and Tanzania, his government is going to institute only two checkpoints from Dar-es-Salaam to the Ugandan border.

President Magufuli added that measures are underway to ensure that goods move freely in the EAC region with a view to increasing trade and investment. “The room for investment is very wide for Uganda and Tanzania business sector. This bilateral forum should be promoted for our people in business. Let’s agree and do business and stop lagging behind in development,” he added.

The Tanzanian leader disclosed that President Museveni and himself took the decision and agreed to the building of an oil pipeline from Hoima to Tanga, one of the longest pipelines in the world, as a sign of commitment between the two countries. During the Forum, the two leaders witnessed the signing of a number of Memoranda of Understanding between Uganda and Tanzania in the fields of Agriculture, Foreign Affairs and Migration. President Magufuli also hosted President Museveni and First Lady Janet Museveni to a luncheon at State House, Dar-es-Salaam.

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MP Munyagwa Denies Bribery Allegations As Pressure Mounts On Him Over His Meeting With KCCA ED, Eng. Kitaka

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“Currently, COSASE is seeking the dismissal of Mr Moses Atwine, whose recruitment as KCCA Director Physical Planning, has been termed as “unlawful” because he does not have the requisite qualification for the job.”

On Monday, photos of MP Munyagwa and Eng Kitaka went viral on social media platforms with reports saying the two discussed how to strike a compromise on the on-going probe into KCCA staff appointments by the Committee on Commissions, Statutory Authorities and State Enterprises (COSASE).

MP Munyagwa in a private meeting with KCCA Acting ED Andrew Kitaka

Kawempe South Member of Parliament, Mubarak Munyagwa has since confirmed meeting Eng Andrew Kitaka, the acting Executive Director of Kampala Capital City Authority (KCCA) but refuted claims that their conversation was rotates around the ongoing probe into the authority. The MP currently chairs COSASE.

On Tuesday, Munyagwa told journalists at Parliament that the meeting captured on a CCTV camera at the Silver City Restaurant, Garden City, was not pre-planned because he was “only going to the gym when he encountered Eng Kitaka.

“I met with Kitaka nine days ago. The problem I have with Kitaka is the delay by the contractor to clear the Lubigi Drainage channel. This was not a secret meeting as some media houses are insinuating. How could I have a secret meeting at a balcony of a restaurant in broad day light?” Munyagwa said.

Currently, COSASE is seeking the dismissal of Mr Moses Atwine, whose recruitment as KCCA Director Physical Planning, has been termed as “unlawful” because he does not have the requisite qualification for the job.

Munyagwa says that despite KCCA spending Shs21 billion on the channel, several area of Kawempe South especially Bwaise, floods every time it rains, hence a need for KCCA to fix the problem.

Asked whether, their conversation did not touch issues of Atwine, Munyagwa said that  that Eng Kitaka tried to raise it but it was not necessary because the director (Atwine)“must leave office.”

“Kitaka tried to tell me to let the status quo remain but I told him no. I only want my drainage channel. There is no bribe I can solicit from Kitaba because he has nothing. I failed to cooperate with Jennifer Musisi, former KCCA Executive Director who had authority, why should I go with Kitaka who is also looking for survival?” Munyagwa added.

The COSASE chairman who says he is set to write to the Public Service Commission to terminate Atwine’s contract, alleges that it is the same director or his cohorts who might be playing the blackmail card against his integrity.

He insists that Atwine must leave KCCA because he never studied Physical Planning yet city dwellers must be assured of the quality of structures being constructed.

 Munyagwa said some people are trying to blackmail him by accusing him of “witch-hunting” people from other tribes.

He vowed to resign his position as COSASE chairman if any accounting officer of a government agency or department adduces evidence where he is soliciting a bribe.

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The Presidency

Uganda – Rwanda Relations. Understanding the Issue of Media Censorship

On Wednesday last week, Ugandan President Yoweri Museveni and Paul Kagame of Rwanda signed a peace pact in Angola, signaling an end to the bitter diplomatic relations between Kampala and Kigali that had resulted into the closure of Gatuna border. But what is mind boggling being that up to date, the Gatuna boarder is still […]

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On Wednesday last week, Ugandan President Yoweri Museveni and Paul Kagame of Rwanda signed a peace pact in Angola, signaling an end to the bitter diplomatic relations between Kampala and Kigali that had resulted into the closure of Gatuna border. But what is mind boggling being that up to date, the Gatuna boarder is still closed with no official communication from Rwanda government.

President Yoweri Museveni and President Paul Kagame after signing the agreement. Courtesy Photo

Despite the signing, the New Times newspaper, which is Rwanda government’s mouthpiece, continued to publish propagandist articles blaming the Kampala regime for the impasse.

As if that was not enough, Rwanda went ahead and blocked access to Ugandan news sites such as The Observer(www.observer.ug), NilePost (www.nilepost.ug), Softpower (www.softpower.ug) and New Vision(www.newvision.co.ug). The blocked websites can only be accessed via Virtual Private Networks (VPN).

This happened a few days after when the Uganda Communications Commission (UCC) ordered Ugandan internet service providers (ISPs) to block access to Rwanda’s The New Times website (www.newtimes.co.rw). The writer could not independently verify whether the blocking of access to Ugandan news sites by Rwandan authorities was in retaliation to UCC’s move.

UCC says the order was because the Rwandan paper has continued to publish ‘harmful propaganda’ against Uganda. UCC spokesperson, Ibrahim Bbosa, said UCC had directed “internet service providers to block New Times for publishing harmful propaganda that endangers the national security of Uganda.”

UCC Boss Godfrey Mutabazi

Adding that, “We are engaging the regulator in Rwanda and hope this will be temporary,” Bbosa said. Currently, an attempt to visit the newspaper’s website from Uganda returns an error.

But for many in the media this was nothing new(censorship), as intimidation and violence is an almost daily threat. Uganda is now ranked 117th out of 180 countries in Reporters Without Borders’ 2018 World Press Freedom Index, five places lower than in 2017.

Demystifying The Trend

Uganda has a long history of media censorship. The country’s first post-Independence head of government, Milton Obote who became prime minister in 1962, banned the intellectual Rajat Neogy’s Transition Magazine. Idi Amin overthrew Obote in 1971 – during his regime, key journalists dissapeared without trace.

The press was a central target during the second Obote government between 1980-1985 and its militiary successor. Museveni’s rise to power in 1986 was met with relief. It’s almost quaint to think back to a time when Uganda, under a newly elected Museveni, was held as a paragon of African democracy with all the freedoms it entails.

In 1990, four years after Museveni came to power the country was still experiencing a new political dawn. A Danish-produced documentary (still available in the archives of Uganda Broadcasting corporation television), then investigating the depth of freedom of the press in Uganda, was clearly enthralled.

The narrator exclaimed that; A free press in Africa, a rare thing in Africa and This is not a mere change of the guard but a fundamental change.

But things started changing for the worse in the mid-1990s. This included the government shutting down media platforms, legal threats, the infiltration of newsrooms by security spies, thuggery, intimidation and withholding of advertising from institutions deemed to be critical of the government.

In the US, traditional censorship was basically an exercise of cut and paste. Government agents inspected the content of newspapers, magazines, books, movies, or news broadcasts, often prior to release, and suppressed or altered them so that only information judged acceptable would reach the public. For dictatorships, censorship meant that an uncooperative media outlet could be shut down or that unruly editors and journalists exiled, jailed, or murdered.

Starting in the early 1990s, when journalism went online, censorship followed. Filtering, blocking and hacking replaced scissors and black ink. Some governments barred access to Web pages they didn’t like, redirected users to sites that looked independent but which in fact they controlled, and influenced the conversation in chat rooms and discussion groups via the participation of trained functionaries. They directed anonymous hackers to vandalize the sites and blogs, and disrupt the internet presence of critics, defacing, or freezing their Facebook pages or Twitter accounts.

Reversing The Trend

Despite all the threats and challenges, the media in Uganda continues to tackle controversial issues and break big stories of corruption and abuse of power. Nation TV’s On the Spot,NBS TV’s Frontline, Capital Radio’s Capital Gang, and Radio Simba’s Gasimbaganye ne Bannamawulire, as well as CBS Radio’s current Affairs programmes continue to court politically controversial topics. They host government critics and civil rights activists who openly speak out.

The president also allows press conferences where probing questions are asked which continue to at least afford a semblance of press freedom in the country in spite of the lurking iron fist.

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