New plan says Ugandans will hit middle-income status by 2017 but critics say it is unrealistic.
country’s economic performance since independence has been characterised by relatively slow growth
The implementation of the Vision 2040 plan, according to the draft report will require a policy shift to a quasi-market approach, a mix of government investments and private sector-driven actions.
Government has outlined the country’s strategic direction in a document criticised by MPs as setting overly ambitious growth targets and improved living conditions to be achieved by 2040.
Themed “Accelerating Uganda’s development to greater prosperity,” Vision 2040 projects that Uganda will, by then, be transformed from a peasantry economy to a modern and prosperous country.
A draft copy of the vision produced by the National Planning Authority,(NPA), a body mandated to coordinate, manage and evaluate frameworks, systems and strategies for cost-effective and participatory national development planning, envisages that the country will graduate into a middle class nation in the next five years.
Per capita income (how much money is earned by each citizen annually) is expected to stand at about $9,500 (approximately Shs23.3 million) by 2040 from the current $506 (about Shs12.4 million).
Some legislators, however, called the report “cosmetic” and queried the method used to arrive at the projected growth indicators. Going by the vision attributes of independence and sovereignity, democracy and the rule of law, stability and peace, Ugandans would enjoy high standards of living and a much higher life expectancy pushed from 51.5 years today to 85 years.
Defending Vision 2040, which is expected for launch as Uganda marks 50 years of Independence in October, the junior minister for finance, Mr Matia Kasaija, told the joint Parliamentary committees on Budget and National Economy last week, the political leadership is committed to achieving this vision.
He said during the vision period, average real GDP growth rate will be over 8.2 per cent per annum translating into a total GDP of about $580.5 billion for a projected population of 61.3 million people. He said this will match the current level of development in other middle income countries like Malaysia, Mauritius, Hungary and Chile.
“The aim of the national vision is to transform Uganda from a predominantly peasant and low income country to a competitive upper middle income country with per capita income of about $9,500,” said the NPA chairperson, Dr Kisamba Mugerwa.
The implementation of the plan, according to the draft report will require a policy shift to a quasi-market approach, a mix of government investments and private sector-driven actions.
The government would lay emphasis on harnessing opportunities in the oil and gas sector through the construction of a refinery and supporting the infrastructure, industrialisation, developing the tourism sector and commercialising agriculture, exploiting more minerals, ICT business ,utilising the abundant youthful labour force, among others.
Uganda’s current labour force in Uganda stands at 13 million according to the Uganda Bureau of Statistics, but with spiralling unemployment rates among young Ugandans. Majority of the unemployed are youths and graduates.
Uganda has commercially viable oil and gas deposits in the Albertine Graben. As of 2009, only 40 per cent of the Graben had been explored and a total of about 2.5billion barrels of oil equivalent discovered. “More commercially viable oil and gas deposits are expected to be discovered as explorations are being carried out in the Graben and other potential areas,” reads the report.
The country’s economic performance since independence has been characterised by relatively slow growth compared to some countries that were at the same level of development like South Korea and Malaysia.
Uganda’s GDP Uganda’s GDP per capita increased from $63.8 in 1962 to $506 in 2010 compared to Korea’s which increased from $103 to $21,000 in the same period.
In the report, NPA projects the percentage of population below the poverty line to reduce to 5 percent by 2040 from the current 24.5 while the infant mortality rate per 100 live births would be reduced from the current 63 to at least 4 by 2040.
It is also assumed in the plan that the implementation of the national population policy and other proposed changes in the education, energy and health sectors will result into a gradual slow down in the population growth rate from the current 3.2 per cent per annum to 2.4 per cent per annum by 2040. At that rate, Ugandans would be about 61.3 million by 2040.
“To improve the quality of the population over the vision period, Uganda will focus on creating a more sustainable age structure by reducing the high fertility rate through improving acess to quality reproductive health services and keeping all children of school going age in school,” reads the report.
Uganda has one of the youngest populations in the world and government hopes to tap into it for labour. “In the industrial sector, priority will be on facilitating the entry of new firms in industries and new comparative advantage developed in strategic areas such as petro-chemical industries as offshoots from the oil refining industries.
Agriculture will also be supported to grow above the current level as so as to sustain poverty reduction and endure food security. The literacy rate is projected to improve from the current reported 73 percent to 95 per cent over the long term. Trade development will focus on sustaining competitiveness of domestic products in external and local markets.
Higher investment is anticipated in urbanisation which, it is hoped, will spur industry. On Thursday, MPs also called for a special and independent planning ministry to oversee the planning sector to implement Vision by 2040. The legislators noted that government has ignored the National Planning Authority (NPA) and underfunded the body. Currently the Authority is a department under the Ministry of Finance, Planning and Economic Development.
“The report is cosmetic and some indicators are an exaggeration because they cannot be achieved,” said Dokolo County MP, Mr Okot Ogong. He queried why Parliament was not consulted and demanded that it be given a chance to contribute. Other legislators doubted whether it was achievable within the given time.
Hatwib Katoto, the Katerera County representative, wondered whether the plan would be achievable given the fact that some plans collapsed before they were implemented.
In 1999, government developed a long term plan called Vision 2025 which was not operationalised due to lack of a well -efined implementation framework. Mr Kasaija, said it failed because of lack of a defined implementation framework.
As Uganda sets out on a journey to attain middle income status, a quick look at the roadmap reveals a daunting task ahead. An extract in from draft Vision 2040 document compares Uganda and five other countries; South Africa, Malaysia, Mauritius, Korea Republic and Botswana which were at the same Gross Domestic Product per capita levels ($1,000) at the time of independence. Today, Uganda has been left miles behind by these countries. Korea Republic’s GDP lies at between $20,000-21,000, Mauritius, Malaysia and Botswana are all enjoying a GDP per capita of between $7,000 and $9,000. Uganda is still stuck at $506 (Shs1.2 million). Uganda’s slow economic growth has been attributed to unstable political conditions and economic mismanagement that rocked the country in the 1970’s that led to the fall of GDP by 25 per cent. In 1999, Uganda in a national consultative process produced Vision 2025. The programme listed the country’s aspirations and objectives. The theme for Vision 2025 is “Prosperous People, harmonious nation and beautiful country”. By Abdu Kiyaga
