Uganda Can Draw Inspiration from China for Growth
文章摘要
Forty years ago, China was an economic dwarf. Today it is an economic giant, with the second biggest economy in the world. It has variously been described as the global manufacturing hub, with a range of products bearing the distinctive label “made in China.”Going up the economic ladder, however, did not happen by accident. It took a major policy shift on the part of the Chinese leadership, which set in motion a series of deliberate undertakings that orchestrated a gradual opening up of the economy to the rest of the world.In the coming years China’s transformation experience will continue to provide valuable lessons and insights for Uganda’s aspirations for growth and development. Economically, China is arguably the best textbook example for Uganda to benchmark, considering the fact that it drew its own inspiration for the current progress from a resource constrained Singapore, four decades ago.A story is told of how Deng Xiaoping, the Chinese leader who is venerated for China’s reform and opening up policy that was rolled out in 1978, was captivated by Singapore’s progress during an earlier visit to the island. Lee Kuan Yew, the Singaporean leader who played host, told Deng that China had the potential to achieve even much more than what his own country had achieved.Apparently, the secret of Singapore’s success was in creating an environment which was conducive enough to attract investments from multinational corporations. Deng took that lesson home and today the rest is history. By extension, what China has achieved in 40 years, Uganda could arguably achieve in the same time frame, if not faster, considering the fact that nature has even endowed the country with an immeasurable amount of resources.What Uganda, however, lacks is capital, the extractive capacity and the cutting-edge expertise to turn around the economy. The country has also been bedeviled by corruption, which is a major threat to progress. Yet, Uganda’s corruption-related challenge today, was one of the challenges China faced as it sought to implement its vision that was inspired by Singapore.While not condoning the vice, the fact that China did not buckle down under the weight of such an insidious challenge, means that there is still hope for Uganda to scale and attain exceptional growth heights, if certain corrective measures are adopted. Corruption by and large increases the cost of doing business and is a major turn off for multinational corporations and financial institutions of repute that operate by the book.There is, however, no doubt that Uganda has one of the best policies and laws that virtually touch all aspects of governance, yet the lack or poor implementation of these checks remains the single major challenge in tackling corruption head-on. It is therefore important for the Ugandan government to make corruption a low return and high-risk venture if the country is to witness a rapid transformation of the economy.The government ought to adopt a zero-tolerance approach in dealing with corruption to send a clear message from the top to the bottom of governance and administrative structures. That certainly needs to go hand-in-hand with strengthening the existing laws and institutions. In addition to other punitive sanctions, the courts should be given the powers to confiscate ill-gotten or unaccounted for wealth of both public servants and public figures.Addressing a recent forum ahead of the Anti-Corruption Day, which in 2018 was commemorated under the theme “Citizens’ participation in the fight against corruption, a sustainable path to Uganda’s transformation,” President Yoweri Museveni pointed out that by staffing relevant institutions with persons of integrity, corruption can be tamed. In that regard, a step-by-step or institution-by-institution approach would be the best strategy for ease of monitoring and evaluating the progress that is being made in the fight against corruption.Since the Ugandan government is eyeing exponential growth, for immediate impact to be felt such radical appointments should initially target key institutions that facilitate investment. This would be closer to the Chinese and Singaporean strategy of attracting investments from multinational corporations, which involved the deliberate creation of a conducive investment climate.According to a Bank of Uganda August 2017 policy note “the Sino-Africa relationship holds many potential long term benefits, such as: the relocation of manufacturing value chains from China to countries with an abundant supply of labor, access to alternative forms of development financing that center on formerly under-financed sectors such as infrastructure and energy, and increased trade and FDI.”The policy note further adds that “for these benefits to be realized, Uganda must put in place the right policies and incentives that will create an attractive climate for potential investment and ensure a mutually beneficial path to industrialisation and structural transformation.”To this end, the Uganda Investment Authority (UIA) as a lead agency is already in place, with clear guidelines and generous incentives aimed at attracting foreign capital and investments. However, going by the President’s philosophy, the institution needs to be staffed with persons of integrity and investment expertise, who understand the grand vision.In fact, the recent fights at the UIA, which culminated in the executive director being interdicted should inspire and fast-track Government actions and resolve in cleaning up and streamlining the institution. Rather than undermine investor confidence; by quickly resolving such fights, plugging loop holes at UIA and cultivating clear policies that curtail red tape, Uganda’s rating as an investment destination would certainly be boosted. Furthermore, the recent amendments made by Parliament in the investment law can all be viewed in light of making Uganda an attractive investment hub.Relatedly, the government’s grand plan of establishing 22 industrial parks across the country is a development catalyst in the right direction. These areas have already been gazetted, and industries have begun to spring up in at least four of these industrial parks. Most of these industrial parks have an input from Chinese firms.Therefore, from being a net commodity exporter, if well implemented, these industrial parks could as well herald Uganda’s entry into the club of manufacturers, as several products begin to carry the label “Made in Uganda.”The China-Uganda Liao Shen Industrial Park in Nakaseke district, which is currently home to two upcoming industries Ho & Mu Food Technology Co., Ltd and Goodwill Ceramic (U) Co., Ltd highlights what industrial parks can achieve within a short period of time. For instance, Goodwill Ceramic (U) Co., Ltd which began operations recently has an investment portfolio of $35m in the plant.According to the company, more than 90% of their product is made from locally sourced raw materials. Currently, the company has a daily production capacity of 40,000 square meters per day and at least 15,000 square meters of that, is destined for the export market. In addition to the hundreds of jobs created both directly and indirectly, the government is able to make savings on foreign exchange that hitherto was spent on importation of ceramic tiles, which are on high demand by the construction industry.Yet, more needs to be done and perhaps differently when it comes to implementation of the industrial park vision. The best approach would be for the government to concentrate its resources on developing major infrastructure like roads, electricity and water among others in one model industrial park, rather than spreading itself thinly in several at the same time. Once complete, it would then be replicated in other areas, as more funds become available.
Abstract
Going up the economic ladder, however, did not happen by accident. It took a major policy shift on the part of the Chinese leadership, which set in motion a series of deliberate undertakings that orchestrated a gradual opening up of the economy to the rest of the world. In the coming years China’s transformation experience will continue to provide valuable lessons and insights for Uganda’s aspirations for growth and development. Economically, China is arguably the best textbook example for Uganda to benchmark, considering the fact that it drew its own inspiration for the current progress from a resource constrained Singapore, four decades ago.
作者简介
Sidney Miria:Research Fellow of Economic Policy Research Center, Uganda