SOME Members of Parliament have called on finance minister Gerald Ssendaula to resign over what they term as the â€˜fraudulentâ€™ sale of Uganda Commercial Bank.
The MPs are mistaken and misguided on three grounds. First of all, the (eventual) sale was transparent. There was an open bidding process, with Barclays, Standard Chartered, Stanbic and dfcu banks showing interest. The bids were in the newspapers. The central bank governor made periodic public announcements on the process.
It is true that there was a lack of transparency before, with the botched sale to the Malaysian firm, Westmont, and this is probably what is clouding the dissenting MPsâ€™ minds.
But Westmont happened while the Privatisation Unit was in charge. It is at that point that this weekâ€™s questions should have been raised. It is after that debacle that Bank of Uganda took over. Statutorily, the central bank, (as in the liquidation of Greenland, Cooperative, Allied and International Credit banks), did not need Parliament to approve of the subsequent sale. So it is dishonest to claim a lack of transparency.
Secondly, the sale price being below the â€˜valueâ€™ price is a spurious argument. We experience it in daily transactions. If the value of Mr Xâ€™s second-hand car was sh3.5m and he sold it for sh3m, would he have undersold? Or if he got sh4m, would he have oversold? It is the market that rules.
Thirdly, the MPs are blind to the strategic interests of this country. UCB was sold to a very sound financial institution that is a good influence in our banking industry. We are sending bad signals to investors and undermining the privatisation process. MPs need to be well researched and conversant with strategic issues before engaging in alarmist debate.
UCB sale was transparent