Adding value to cotton by exporting it!
Jan 04, 2009
EDITOR—The creators and ardent believers of capitalism are saying: “...wait a minute.... casino capitalism won’t take us there.â€
EDITOR—The creators and ardent believers of capitalism are saying: “...wait a minute.... casino capitalism won’t take us there.â€
Yet here in poor Uganda, we must deregulate, allow market force free rein, at least going by President Museveni and the Uganda Investment Authority. This is Margaret Kigozi’s ‘treatise’ on the cotton sector in the country, whose woes she fully blames on regulation by the Cotton Development Organisation (CDO), in her article published in The New Vision of December 29, 2008. Besides strange inaccuracies that reveal her lack of differentiation between a cotton ginnery and a textile mill, Dr Kigozi seems either to have an axe to grind with the CDO or a soft spot for Dunavant, the US company whose case she is vehemently arguing. Back to substance. Even at mere lint export level, it would be suicidal to let ‘market forces’ determine the fate of our cotton sector. What were the conditions pertaining in 1969, the oft-mentioned bumper harvest year for Ugandan cotton? I can confidently assert that this was the golden era of planned and regulated production at every vital stage of the value chain: farmer cooperatives like Nyakatonzi and Lango Cooperative Union; Uganda Cooperative Transport Union, Lint Marketing Board; Cooperative Bank; District Farm Institutes; subcounty agricultural assistants and a well developed textile industry. Remember Nytil, UGIL, and Mulco? Juxtapose them against the current ‘liberalised and modern’ private sector-led situation: ‘private’ ginners, SACCOs (or is it CIRCLES?),NAADS, mivumba (secondhand clothes) and others. The fruits are there for all to see! And at this point in time, when the NRM gospel is value-addition, why on earth should we be striving to increase exports of raw cotton? Museveni’s ‘kilo-of-cotton versus T-shirt’ dichotomy is as old as his tenancy in state house, yet here we have the torch-bearer of Uganda’s Industrialisation Path (through FDI), craving for increased exports of raw cotton,... “since Dunavant ...is an American company ....and can pull other american companiesâ€!
Time to refocus and we begin with a total repositioning and restructuring of the key institutions in the industrialisation and development path. Time to merge UIA, National Planning Authority (NPA) and Uganda Export Promotion Board (UEPB), into a National Economic Development Authority (NEDA). These authorities and others can be directorates (Centres of Excellence) under NEDA.
Planning, export or investment are not ends in themselves, but strategies to national development. Yet their ‘autonomy’ seems to have made them operate as ends in themselves! NEDA, working with the Economic Policy Research Centre at Makerere, Uganda Manufacturers Association, and farmers' cooperatives, will be in position to chart out a reasonable National Development path, with pro-poor industrialisation strategy as the backbone. The current private sector-led maze will only keep us going round in circles, (pun intended). Poverty and underdevelopment are bigger threats than the political and other reasons why cooperatives had to die!
Have a fruitful 2009:
Amon B. Mbekiza
Kampala
Yet here in poor Uganda, we must deregulate, allow market force free rein, at least going by President Museveni and the Uganda Investment Authority. This is Margaret Kigozi’s ‘treatise’ on the cotton sector in the country, whose woes she fully blames on regulation by the Cotton Development Organisation (CDO), in her article published in The New Vision of December 29, 2008. Besides strange inaccuracies that reveal her lack of differentiation between a cotton ginnery and a textile mill, Dr Kigozi seems either to have an axe to grind with the CDO or a soft spot for Dunavant, the US company whose case she is vehemently arguing. Back to substance. Even at mere lint export level, it would be suicidal to let ‘market forces’ determine the fate of our cotton sector. What were the conditions pertaining in 1969, the oft-mentioned bumper harvest year for Ugandan cotton? I can confidently assert that this was the golden era of planned and regulated production at every vital stage of the value chain: farmer cooperatives like Nyakatonzi and Lango Cooperative Union; Uganda Cooperative Transport Union, Lint Marketing Board; Cooperative Bank; District Farm Institutes; subcounty agricultural assistants and a well developed textile industry. Remember Nytil, UGIL, and Mulco? Juxtapose them against the current ‘liberalised and modern’ private sector-led situation: ‘private’ ginners, SACCOs (or is it CIRCLES?),NAADS, mivumba (secondhand clothes) and others. The fruits are there for all to see! And at this point in time, when the NRM gospel is value-addition, why on earth should we be striving to increase exports of raw cotton? Museveni’s ‘kilo-of-cotton versus T-shirt’ dichotomy is as old as his tenancy in state house, yet here we have the torch-bearer of Uganda’s Industrialisation Path (through FDI), craving for increased exports of raw cotton,... “since Dunavant ...is an American company ....and can pull other american companiesâ€!
Time to refocus and we begin with a total repositioning and restructuring of the key institutions in the industrialisation and development path. Time to merge UIA, National Planning Authority (NPA) and Uganda Export Promotion Board (UEPB), into a National Economic Development Authority (NEDA). These authorities and others can be directorates (Centres of Excellence) under NEDA.
Planning, export or investment are not ends in themselves, but strategies to national development. Yet their ‘autonomy’ seems to have made them operate as ends in themselves! NEDA, working with the Economic Policy Research Centre at Makerere, Uganda Manufacturers Association, and farmers' cooperatives, will be in position to chart out a reasonable National Development path, with pro-poor industrialisation strategy as the backbone. The current private sector-led maze will only keep us going round in circles, (pun intended). Poverty and underdevelopment are bigger threats than the political and other reasons why cooperatives had to die!
Have a fruitful 2009:
Amon B. Mbekiza
Kampala