By Paul Muleme
As the Western world offers aid to help Africa’s economies such as Uganda to supplement their budgets for social economic development, it should be realised that this aid doesn’t come cheaply.
This aid does some relief, helps a country recover from a crisis and allows a country to grow. However, it has conditions attached that are not in the best economic interest of the recipient country.
Here we see a country sovereignity undermined in terms of policy dictates from the donor country to determine what you should do through international organisations like IMF that dictate economic reforms a recipient country should undertake that may not serve the indigenous best interests.
We have seen big grants offered, however, you find that a big percentage of the technical staff is from the donor country consuming a big percentage of the operational budget to implement the project in terms of administration, travel, medical, consultancy whereas we have equally qualified personnel in our countries to take on these tasks .
Then you will also have to buy equipment from their markets which repatriates money back to the donor economy.
You find that this aid in most cases does not go to the poor people , denies market access to poor countries whereas the donor aid opens their products to poor markets , at times money is embezzled by bureaucrats and also its wasted on over priced goods and services from donor states .
China is an emerging second largest economy in the world and the world’s fastest growing economy with growth rates of 10% over the last 30 years. It is the largest exporter and second largest importer of goods in the world, with a big manufacturing potential in the world. It is also the fastest growing consumer market in the world with a population of approximately 1.3 billion people.
It is of paramount interest and gesture to pick a leaf from the Chinese Ambassador to Uganda Zhao Yali who recently while on a visit to Sembabule he said his government will develop remote areas in Uganda by improving roads, education and the electricity network. You realise these are core areas of infrastructural investment for any economy desiring to grow to take off for development.
President Museveni’s stated policy of having China as a preferred development partner has spearheaded a number of infrastructural investments in the economy like award of an oil production license to China National Offshore Oil Corp (CNOOC) has set a time line for Uganda to begin producing oil, the commissioning of the 600MW Karuma hydropower dam at a cost of $1.4 and laying of a foundation stone for the construction of the 183 MW Isimba hydropower project on River Nile to be constructed by China International Water and Electric Corp are all fundamental projects to transform Uganda’s economy.
China’s commitment to support Uganda realise its 2040 vision development mission is a welcome gesture . This relates to the fact that China was like Uganda 35 years ago so sharing experiences between the two countries will be a big catalyst for Uganda’s development.
China is an ideal development partner as she imposes no special political conditions upon its recipient country and is not perceived as an imperial master. She has always been perceived as an occasional peace maker than a country that stems armed conflict for example it brokered peace making in South Sudan with the government of Sudan.
Uganda’s infrastructural projects are being handled by China due to the fact that China offers cheap credit in terms of concessional loans and also Chinese companies can be repaid from future oil revenue whereas western companies expect to receive advance payments before the project is implemented.
There are good lessons we can share from the development path China undertook to transform their economy like structural reforms from agriculture to an industrial production economy, social and economic reforms like privatisation of state owned enterprises, opening up to the outside world by welcoming all types of foreign investments but keep them regulated, investment in human resource and technology, price equalisation that involved use of low labour costs that increased labour growth and reduced unemployment levels .
It is noted among locals that Chinese create jobs, transfer skills and spend money in the local economies. African elites see China as an emerging big partner to advance their social economic interests. Bilateral trade between the two countries has grown tremendously to over 35% increase compared to the 2011 trade figures, Over 256 Chinese firms are operating businesses in Uganda and has opened up its market to Uganda’s business men.
The growing globalisation around the world will lead to an increase of demand for Africa’s resources and goods which a country like Uganda should exploit to promote its tourist industry to China since it is noted that the Chinese population is emerging with big figures of people trotting the globe as tourists.
We can also take advantage to spearhead an export oriented economy for a big consumer market in China that will increase productivity in our economies.
The writer is a teacher and businessman