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President’s speech

Africa Now Summit 2019

H.E. Yoweri Kaguta Museveni

PRESIDENT OF THE REPUBLIC OF UGANDA

12TH MARCH, 2019


Your Excellencies, Heads of States and Governments,

Rt. Hon. Speaker of the Ugandan Parliament,

The Chief Justice,

Their Excellencies the Heads of Delegations,

Rt. Hon. Prime Minister,

Hon. Ministers,

Hon. Members of Parliament,

Distinguished Delegates,

Ladies and Gentlemen.

THE LEADERSHIP NEEDED TO CATALYSE AFRICA’S


TRANSFORMATION

We first need to understand what is meant by transformation. In the


1960s, economists were talking about growth and development.
Growth was supposed to mean quantitative expansion of the respective
sectors e.g. grow more coffee, cotton, etc. Development was a term that
implied some qualitative changes ─ propelling the economy and society
to a higher level. Later on, however, when we became active on the
scene, I insisted on the use of the word transformation.

In the 1960s, they used to talk of “sustainable development” ─ meaning


growth that has got some self-propulsion and the ability to be
sustained. However, I insisted on clarifying this point. My question,
then, was: “Can you have sustainable pregnancy?” This means
pregnancy that is indefinite. The answer is that it is neither feasible nor
desirable to have sustainable pregnancy. In the pregnancy, we have
the micro-cosm of both the quantitative expansion (the baby growing in
the womb) and the qualitative leap after 9 months when the pregnancy
transforms into a baby ─ breathing through the nose, eating through
the mouth, etc., instead of previously doing comparable activities
through the umbilical cord. It is the same organism going through the
different forms of life. In biology, they call it metamorphosis, where the
insect goes through the different forms of life: egg, caterpillar, pupa and
mature butterfly. It is the same organism going through the different
forms of life.

Similarly, the same applies to society. Ever since the evolution of man
from the earlier primates into the homo-sapien sapien four and-a-half
(41/2) million years ago, the society of these people has been evolving
from the hunter-gatherer communities that dwelt in trees (tree
dwellers); cave dwellers with the invention of fire; using ever-changing
tools (stone, brass, iron, guns, spears, etc.); the domestication of crops
(agriculture instead of hunter-gathering); the domestication of animals
(pastoralism); through feudal times; to the Industrial Revolution with its
earlier 3 stages (the use of steam engines, the discovery of electricity
and rail transport and the automation of the 1960s); and the unfolding
4th Industrial Revolution in the form of artificial intelligence where
intelligent machines perform the work of the human beings.

All these changes have been transformational ─ not just quantitative


changes, but changes involving qualitative leaps. These are what we
mean by transformation; not just increasing quantitatively, but also
assuming a higher quality.

After independence, I used to hear leaders talking of “double


production” ─ meaning more production of the same product ─ raw
materials. That double production did not help as long as we were at
the same qualitative level ─ producing raw-materials and not adding
value to them ourselves.

In the 1960s and 1970s when the only affluent part of the world was
Western Europe and the USA, double-production of raw-materials
meant over supply which would result into lower prices. You produce
more but you get the same or lower prices. The price of copper
collapsed. The price of coffee collapsed. The price of cotton collapsed. I
remember the year 1972 saw the lowest price of cotton because the
synthetic fibres of nylon, etc., had hit the market. It was only when
people realized that those nylons were not good for the human skin that
the prices of cotton started recovering again. The expansion of affluence
to China, India and Brazil also saw the recovery and even the soaring of
the commodity prices. Copper hit the price of US$9,900 per tonne in
the year 2010; coffee US$4,000 in the year1994; cement US$56.3 in
the year 2017. When the NRM government came to power 33, years
ago, I tried to promote our considerable deposits of iron-ore at Usukuru
hills, Muko, etc. I was told clearly by the different investors that there
was a “glut” of steel on the world market and, therefore, there was
nobody interested in steel. A price of steel that time was as low as
US$200 per tonne. By 2008, it had hit US$900 per tonne (Sources:
Uganda Export Promotion Board and World Bank).

I am quoting all this to show you the danger of the double-production of


the same product without making the qualitative leap of
transformation. Quantity into Quality. You may labour “in vain”. It
says in the Book of 1Corinthians Chapter 15:58 in the Bible that:
“Therefore, my dear brothers and sisters, stand firm. Let nothing move
you. Always give yourselves fully to the work of the Lord, because you
know that your labor in the Lord is not in vain”.

Therefore, transformation means a qualitative leap, not just


quantitative expansion.

By 1400 AD, many of the African societies were a bit like the European
ones at that time. They were late iron-age and were three class
societies: the feudalists, the artisans and the farmers. However, by the
time of the French Revolution, the European society had
metamorphosed into a four class society: the old feudalists, a new class
known as the bourgeosie, a new class known as the proletariat and the
old residual class of the peasants (the farmers). It is the new classes,
the bourgeosie (the middle class) and the proletariat (the working class),
supported by one of the old classes, the peasants, that caused the
French Revolution of 1789.

Since that time, the European society has undergone further


transformation with the shrinking of the feudal class and the
disappearance of the peasant class. Today, therefore, Europe is a two
class society ─ the middle class and the skilled working class. The
middle class contains active entrepreneurial elements and the working
class is skilled. It is these two elements that have propelled Europe
through the three Industrial Revolutions and are now pushing it into
the 4th Industrial Revolution ─ the one of Artificial intelligence.
The problem with Africa has been that in the last 600years, the African
Society has not metamorphosed. On the contrary, in some aspects, the
African Society has regressed. How? The African artisan class was
wiped out by the colonial imports. Their artisan products were now
monopolized and replaced by colonial products ─ plates, spoons,
cooking pots, textiles, leather products, etc. The feudal class, which was
competing for power with the colonialists, was decimated and was
replaced with the colonial civil servants (supported by African
auxiliaries ─ court clerks, interpreters, colonial sergeants etc).

The only class that survived was that of peasants who were put to
growing colonial cash-crops (coffee, cotton, tobacco, tea, palm oil etc.)
for supplying the colonial industries.

With independence, although alot of time was lost with military


governments engaged in primitive fascism, nevertheless, many African
governments have correctly identified two crucial stimuli that can
catalyze social transformation. These are: education and health for all
(human resource development) and private sector led growth. The two,
education and liberalism in the economy, have the potential to cause
social transformation. Especially the importance of the private sector
was not clear to many African leaders. Here, in Uganda, both Obote
and Amin interfered with the private sector with Nakivubo
announcements of 1970 and Amin’s expulsion of the Asians in 1972. It
is the NRM that firmly rejected this mistake by returning the properties
of the Asians and liberalizing the economy. These sectors we liberalized
by removing the role of the State companies have performed miracles.
We sold government buses and hotels, for instance.

That act of removing government from the sector of transport and


hospitality has stimulated a total of 1,685 private buses (2015/18),
10,940 taxis, 1,063,922 boda-bodas and 3,000 private hotels. All these
are employing a total of 2 million Ugandans. The NRM took a pioneer
role in defogging this issue.

Education imparts literacy, numeracy, intellectuality and skills. Such a


product is totally different from the pre-capitalist populations that still
dominate Africa. The pre-capitalist peasants only produce for
homestead consumption. They have still not acquired the useful
concept of profit ─ that difference between the cost price and the selling
price if I remember my arithmetic of P.4 in 1956. Indeed, Adam Smith
wrote that the pre-capitalist man is a jack of all trades and a master of
none. He writes as follows on page 13-14 in his Book, “The Source of
the Wealth of Nations”: “It is impossible for pals very quickly from one
kind of work to another, that is carried on in different places, with quite
different tools. A country weaver, who cultivates a small farm loses a
good deal of time in puffing from his room to the field, and from the field
to his room. When the two trades can be carried on in the same work
place in the same work house no doubt much of the time would be
saved……… A man who commonly faunters a little in turning his
hands from one fort of employment to another. When he first begins the
new work he is seldom very keen and hearty; his mind as, as they are
fay, does not go to it, and for some time he rather trifles than applies to
good purpose……. Which is naturally, or rather than necessarily
acquired by every country workman who is obliged to change his work
and his tools every half an hour, to apply his hands in twenty different
ways almost every day of his life renders him almost always flothful and
lazy and incapable of any vigorous application even on the most preffing
occasions”.

Education per se is not enough. If it creates people who only want white
collar jobs with no skills to enable them produce goods and services, it
will only swell the number of the unemployed. They will have
abandoned the subsistence farming of their parents without getting a
skill in producing a good or service for the market either as employers
or as workers.

Apart from education and the liberalization that frees the private sector
to be active and innovative, you need other enablers. I have, previously,
characterized these as removing the ten strategic bottlenecks. Creating
the enablers is removing those strategic bottlenecks.

By addressing the issues of education and health as well as the issue of


the freedom of the private sector in its efforts to create wealth and jobs,
we would have removed 2 strategic bottlenecks.

The 8 remaining strategic bottlenecks are: ideological disorientation


where emphasis is put on identity rather than on interests, leading to
sectarianism; that creates a weak State that cannot guarantee security,
a sine qua non of private sector growth; lack of infrastructure such as
electricity, the railways, etc., which results into high costs of doing
business in an economy that undermines the profitability of companies
and, therefore, limits their expansion; a narrow internal market that
cannot absorb the products of large scale manufacture of goods and the
expansion of services; stopping the export of raw-materials where we
get only 10% of the value of the product and lose jobs to the outside;
the under development of agriculture where, in the case of Uganda,
68% of the homesteads are still in the non-money economy where
people produce only for subsistence; the under development of services
such as tourism, insurance or hotels; and, in some cases, absence of
democracy.

It should be noted that in the earlier part of this speech, we showed


how society metamorphosed from one type of society (social formation)
to another type. The primer, the initiator of all these changes is the
progress in science and technology.

When man invented fire, society was able to descend from the trees to
the caves. The invention of iron, enabled society to more easily produce
crops and also to have better weapons (spears, etc). The invention of
gun-powder and its use in Europe, created a disequilibrium in the
World Order of that time. Huge chunks of the globe were conquered
and colonized by the possessors of gun-powder. Therefore, for Africa to
undergo social-economic transformation, science and technology must
lead the way. The scientists should, therefore, be well paid ahead of
everybody else because we badly need them to copy or innovate the
crucial scientific discoveries.

Awareness of the issues raised above is very crucial for Africa’s


transformation. Addressing the above issues will enable us to create
prosperity for our people. How? By our producers generating alot of
goods and service products that find a ready market. The more we sell,
the more we produce. The more we produce, the more jobs we create
and the wider the tax base. The more taxes we collect, the better social
services the African governments will provide. Today, the African
population is 1.25bn with a purchasing power of US$6.757 trillion.

By 2050 this population will be 2.5bn. Uganda alone will be 102 million
people. With much bigger purchasing power, Africa will be the engine of
the World economy provided we solve the bottlenecks.
I thank you.

Date:

Tuesday, March 12, 2019