Museveni’s speech at 2nd National Conference of NRM

Speech by H.E. Yoweri Kaguta Museveni President of the Republic of Uganda and national chairman of the NRM at the second meeting of the First National Conference of the National Resistance Movement on June 26, 2010 at Namboole National Stadium

Hon Members of the NRM National Conference, I greet you most warmly. Before I go further, I know that since our last meeting in 2005, some of our members have departed from this life. I ask you to stand for a minute of silence in their memory. May the Almighty God rest their souls in eternal peace. It is now my duty to report to you the good achievements the NRM has made since we last met in November 2005. I would like to report, in particular, six good achievements since we last met.

These are:
The continued expansion of the economy, enabling us to get nearer to the level of self-sufficiency in our budgeting and plans; and its implications for even faster economic growth;

The discovery of oil and gas in reasonable quantities in Uganda;

The realisation by our scientists that they have the know-how, provided they are adequately funded, to power the further growth of our economy;

The pacification of the whole country;

The greater realisation of the importance of regional integration given the fact that this part of Africa cushioned us against the effects of the global economic collapse; and

The continuing effort to get the 68% of the homesteads in Uganda out of subsistence farming into commercial farming through NAADS.

First, I would like to report that our economy is now sh34.2 trillion. This is about US$17b. This is six times bigger than our economy in 1986. Although the population has also grown, the GDP per capita has still grown from US$264 in 1986 to US$540 today. Remember that the population of Uganda in 1986 was about 15 million, while it is now 31.5 million (December 2009). All the same, the per capita GDP has still doubled. The economy would have grown even faster if we did not have the bottlenecks of electricity and transport.

Between 1986 and 2006, we depended mainly on what they call donors to fund infrastructure — energy, transport, etc. Indeed, these donors did help to some extent to stimulate our recovery. They, for instance, enabled us to re-construct Kampala – Masaka -Mbarara – Kabale – Katuna road in 1988-1990; to reconstruct Kampala – Jinja-Bugiri – Malaba road; Kafu – Karuma road, etc.

The 180MW Owen Falls Power Station (Nalubaale) was repaired and upgraded with British support. By 1986, the capacity of this power station had declined to only 60MW due to years of neglect. Government, supported by the British, addressed this anomaly by refurbishing and upgrading this power station from 60MW to 180MW between 1989 and 1998. These measures, however, were very limited efforts in terms of transforming the economy. Given the greater demands of the economy, depending on loans and grants from outside was completely inadequate and unreliable.

We ended up lagging behind in so many areas, especially electricity generation, roads and the railway. When you have inadequate and unreliable electricity, doing business in the country becomes expensive – the costs are high. That is similarly the problem with transport – high transport costs undermine business. High electricity and transport costs eat into the profitability of companies so that our country does not become as an attractive business destination as we would want it to be. As you will see from the table below, tax collection in 1986 only gave us sh5b because the economy was in ruins and tax administration was also poor.

By 1996/97 tax collection had somewhat improved. It was at sh728.35b. Here we faced a choice: Either to spend our improving tax revenues on education for all our children (UPE) or spend it on electricity and roads. I decided and recommended to the NRM that we start with the human capital — educating our children. We spend lots of money on UPE and now USE. In FY 2009/10, we spent sh744.16b on these programmes (sh504.11b on UPE and sh240.05b on USE).

That is why it is maddening to come across teachers who insist on re-introducing charges in schools (examination fees, lunch money, etc). We decided to deny roads, electricity, the railways, etc money because of wanting to unblock the way for the children that had been blocked by these charges.

Only 2.5 million children were going to school that time. The children going to primary schools are now eight million. Clearly, the school charges were the road-block. Why, then, do the teachers want to bring back these charges? Are communities now so rich that they can afford to pay for education unlike in the past? If this is so, why then do we continue to divert this huge sum of sh800b from the roads, electricity, etc? Why not abolish UPE so that we concentrate on roads and power? I need the opinions of parents on this. I cannot accept promising ‘air’ to the children — simply tantalising them — kunegura, kukokoonya, kiwuuma, etc. One of my supports pointed out that teachers who teach in private schools get less remuneration compared to those working in government schools. Yet they teach well and the children pass very well. Therefore, the problem in government schools is poor supervision, not remuneration. Anyway, in 1996 we decided to embark on UPE funded by our money.

The expectation was that the donors would fund electricity generation and transport. They could not and where they did, it was always too little and too late. You remember the energy crisis we had in 2005. It was, partly, caused by the Sixth Parliament and, partly, caused by this dependency on external funding.

Fortunately, by that time our tax collection was improving. That is when I called for a special Cabinet meeting soon after the 2006 elections. Apart from the problem of the scarcity of resources, in Africa there is also the problem of the failure to prioritise. All sectors — productive and consumptive sectors — struggle for “equal distribution” of resources. This is very dangerous. The Banyankore long ago saw this danger and evolved a proverb that goes as follows: “Garya embibo gashekyera ekiteme” — the teeth of the unwise cook and eat the seeds that had been put aside for planting on account of the acute hunger of the moment; and when the time for planting comes, they (the same teeth) smile at the garden helplessly because they have nothing to plant.

Your see how inefficient English is compared to African languages. It takes a whole page to describe in English what a Munyankore would describe in just four words as you can see above. The cabinet was persuaded to prioritise. We prioritised: CHOGM, electricity, roads and scientific research in addition to defence. All this was possible, however, because of the improved tax collections.

Below is the table for the tax collections of the government since 1986:
It is because of this improved tax collection capacity that we have been able to set up an Energy (electricity) Fund of US$350m and we have been able to undertake the tarmacking of the following roads since 2008 using Government of Uganda funds:

Kampala–Masaka (124Km);

Kampala–Mityana (57Km);

Matugga–Semuto–Kapeeka (41Km);

Kampala–Luwero (166Km).
We shall also shortly be signing contracts for the upgrading to tarmac of Mbarara–Kikagate (75Km) and Malaba/Busia–Bugiri (83Km) roads. In addition to this, we are completing the design of over 1200Km of roads across the entire country using our own money for upgrading to tarmac. We have recently advertised for pre-qualification of potential contractors for these roads.

Given our increased self-sufficiency, we are now going to tarmac the following roads using our own money:

Kampala-Masaka;

Mbarara–Ntungamo–Kabale-Katuna (I thank the EU because they are doing the Masaka-Mbarara portion);

Mukono-Kyetume–Katosi–Kisoga-Nyenga;

Nakapiripirit–Nanduget– Moroto;

Mbarara–Kabingo–Kikagate;

Nyakahita–Ibanda–Kamwengye– Fort Portal (we will co-fund this with ADB);

Ishaka–Kagamba–Ntungamo– Mirama Hill;

Rukungiri–Bwambara–Kihihi-Ishasha and Kihihi–Kanungu-Nyakishenyi;

Kyenjojo–Muziizi–Hoima– Masindi;

Kapchorwa–Bukwo-Suam;

Mbale-Bubulo–Magale–Bumbo-Lwakhakha;

Rwekunye–Masindi Port–Lira-Puranga–Kitgum–Kidepo;

Mpigi–Kanoni–Kabulasoke– Maddu-Sembabule;

Nyendo–Bukomansimbi-Sembabule;

Matugga–Semuto–Kapeeka;

Nakasongola–Saasira;

Hoima–Kaiso Tonya, etc

Musita–Namayingo–Nankoma-Majanji;

Tirinyi–Palissa–Kumi; etc, etc.

We shall continue to add money to the Energy Fund. It is this Energy Fund that helped us to start the construction of Bujagali. Otherwise, Bujagali would never have taken off. The developers of Bujagali were facing the usual problems of external funding. Some “Environmental” (read opportunist) groups were concerned that some butterfly would be harmed or some “spirit” of ancestors would be disturbed.

Therefore, the funding could not be confirmed until that matter had been concluded. Due to the growth in demand at the rate of 8% coupled with the delay in constructing the Bujagali hydropower project and the prolonged drought between 2003 and 2006, we experienced an acute electricity supply deficit resulting into load shedding 120MW during the evening peak hours. To avert this crisis, we introduced electricity generated from diesel, which is expensive.

This is, apparently, the situation in much of Africa. That is how Africa has continued to mark time. “We leave undone that, that we ought to have done and do things that we ought not to have done and there is no truth in us”, as the Church of Uganda Common Prayer Book says.

The NRM, however, has always refused to be part of this comic-tragedy. That is why the NRM has managed to rescue Uganda. Uganda is now set to take off and undergo socio-economic transformation.

Meanwhile, on the side of constructing electricity lines to the different parts of the country, we were seriously lagging behind because external funding was simply not coming. Besides, we had had to squander billions of shillings subsidising the very expensive power generated using imported oil. With electricity from water we use US 3 cents to produce a unit; however, with electricity from imported diesel, the cost is US 23 cents to produce a unit.

Therefore, we had to subsidise each unit by sh154 for domestic consumers and sh170 for large industrial consumers. Otherwise, the cost of electricity could have been unaffordable. Even now when the cost of electricity per unit is sh385 for domestic consumers and sh185 for large industrial consumers, it is still very expensive. What would be the case if the consumers had to pay the full cost of sh539 per unit for domestic consumers and sh355 for large industrial consumers per unit?

On account of this mistake imposed on us by elements of the political class and external funding, we have had to squander sh500b (sh92b per year) in the last five years in subsidising this expensive electricity. This would have been part of the money we would have used to extend electricity to more parts of Uganda.

Wherever I go up country, I face demands for these lines. Recently, therefore, I directed that we use part of the Energy Fund (possibly US$5m) to extend these lines to many of these areas. Accordingly, we are now going to build the following lines:

Sironko–Nakapiripirit–Amudat;

Katakwi–Moroto;

Ibanda–Kabujogera– Kamwengye;

Kakumiro–Birembo–Narweyo;

Lwala–Kaberamaido;

Dokolo;

Amolatar–Namasale;

Bukwiri–Kyankwanzi;

Lira–Aloi;

Kitgum–Palabek;

Kayunga–Busana;

Muhanga–Kamwezi;

Muhanga–Rwamucucu – Kashambya– Rugyeyo/Kyempene;

Myanzi–Kiganda–Mubende;

Soroti–Katakwi–Amuria;

Ayer–Kamdin–Minakulu –Bobi;

Ibanda–Kazo–Rushere (including Ruhoko– Nyarukiika);

Gulu–Acholibur;

Paicho–Patiko-Palaro;

Opeta–Achokara;

Iceme–Otwai;

Masindi/Hoima–Waki small hydropower plant including Buliisa;

Kazo–Rwemikoma–Buremba– Rukunyu including Rushere–Mugore–Kijuma;

Hoima–Buseruka small hydro plant;

Ruhiira–Millennium Village;

Ntenjeru–Baale–Mpenja;

Arua–Maracha–Koboko;

Nyapea–Zombo–Zeu–Warr– Vurra;

Nebbi–Nyarurur–Pakwach– Panymur with tee-off to Parombo;

Gulu–Atiak–Adjumani–Moyo;

Abim–Kotido–Kaabong;

Migyera–Nakitoma–Kafu.

In addition to the above 32 large schemes, Government is also going to construct a total of 310 small and medium size rural electrification schemes to cover trading centres, health centres and schools countrywide.

Electricity generation, meanwhile, is growing. While in 1986 you only had 60MW of electricity, you now have a total installed capacity of 610MW. When Bujagali is finished in April 2012, the total will be 892MW (small hydro power projects like Mpanga 18MW, Buseruka 9MW and Ishasha 5MW will also be ready by 2012). Another 230MW HFO-gas generation plant is being set up in Tororo. When we use our own HFO and gas, they will produce cheaper electricity at US 8 cents to 10 cents per unit. Our gas and HFO will not have freight and tax costs on it.

Therefore, on account of self-sufficiency we are going to tarmac a total of 1746 Km of roads and also build more power stations as well as extending the electricity lines to many new areas.

God is always true to his word. In the book of Matthew 25:14-30, Jesus talked of the parable of the talents. It says:

The Parable of the Talents (Matthew 25:14-30) 14” Again, it will be like a man going on a journey, who called his servants and entrusted his property to them.

15”To one he gave five talents of money, to another two talents, and to another one talent, each according to his ability. Then he went on his journey.

16”The man who had received the five talents went at once and put his money to work and gained five more.

17”So also, the one with the two talents gained two more.

18”But the man who had received the one talent went off, dug a hole in the ground and hid his master's money.

19”After a long time the master of those servants returned and settled accounts with them.

20”The man who had received the five talents brought the other five. ‘Master,’ he said, ‘you entrusted me with five talents. See, I have gained five more.’


21”His master replied, ‘Well done, good and faithful servant! You have been faithful with a few things; I will put you in charge of many things. Come and share your master’s happiness!’

22”The man with the two talents also came. ‘Master,’ he said, ‘you entrusted me with two talents; see, I have gained two more.’

23”His master replied, ‘Well done, good and faithful servant! You have been faithful with a few things; I will put you in charge of many things. Come and share your master's happiness!’

24”Then the man who had received the one talent came. ‘Master,’ he said, ‘I knew that you are a hard man, harvesting where you have not sown and gathering where you have not scattered seed.

25”So I was afraid and went out and hid your talent in the ground. See, here is what belongs to you.’

26”His master replied, ‘You wicked, lazy servant! So you knew that I harvest where I have not sown and gather where I have not scattered seed?’

27”Well then, you should have put my money on deposit with the bankers, so that when I returned I would have received it back with interest.

28” ‘Take the talent from him and give it to the one who has the ten talents’.

29”For everyone who has will be given more, and he will have an abundance. Whoever does not have, even what he has will be taken from him.

30”And throw that worthless servant outside, into the darkness, where there will be weeping and gnashing of teeth.

Therefore, the one who used his talents well had more added to him; the one that did not use his talent, he had the one he had taken from him. Similarly, the NRM, by working well to revive the economy of Uganda, God has added more “unto us” — the discovery of oil and gas. We now have two billion barrels of oil in place confirmed. Out of that, we shall be able to pump out 0.7 billion barrels which, going by the average price of a barrel of petroleum today, is worth about US$35b. This is significant value generated for the country as a result of concerted effort of government that involved capacity building of our people and effective promotion and monitoring of the Petroleum Exploration programme in the country.

I reject the position of those who get intoxicated with the idea of oil money. The human resource, the people of Uganda, are Uganda’s greatest wealth. I never get tired of telling you that Japan and South Korea do not have oil or minerals. Yet they are many times richer than Saudi Arabia that has a lot of oil.

Nevertheless, this oil money will be used to create infrastructure, or to expedite the creation of the infrastructure, precisely in the sectors I have been talking about above — electricity, roads, the railway and some aspects of education and health. We shall use this money to also fund scientific research and incubation of projects. This is the second point I wanted to raise for the Honourable delegates.

The third point I want to raise is the crucial role our scientists are beginning to play in developing Uganda. Uganda has been educating scientists for many years. These indigenous scientists are beginning to use their knowledge to delve into our heritage and to discover products that are very useful for mankind. They have found good products from bananas, juice, omulondo, papyrus, omuhoko/oluwoko, enkamyo (milk culture), etc.

Makerere students have also manufactured an electric car. When we linked up with these scientists, we started funding them. There is also the Uganda Industrial Research centre (UIRI) at Nakawa. All these are doing a commendable job. We can no longer get stuck with products — agricultural, mineral, biomass, etc — that we cannot process into finished consumer goods or, at least, into intermediate products.

The fourth point is that, at last, we have pacified the whole country. We have defeated Kony and the disarming of the Karimojong warriors is going on. We are now, therefore, for the first time, able to use the whole of Uganda for development. The remarkable progress quoted above was achieved using only a part of the country — the Southern areas.

What is going to happen when we use the whole country and remove the bottlenecks like the shortage of electricity? The security in the country has been the work of, mainly, the UPDF with the support of the Wanainchi. There is no possibility of anybody disturbing Uganda again using extra-constitutional means. This is because the army has matured and is able to defend the country promptly and decisively.

The fifth point is to do with regional integration. While some Ugandans and other Africans are still mired in tribalism and other types of sectarianism, modern imperatives compel us to look for markets. Otherwise, we cannot develop and we may, eventually, perish. Modern commercial agricultural and industrial production can only be sustained if there is a big market to buy what is produced. I never tire of telling you that my prosperity in Rwakitura, as a milk producer, is not only based on my Banyankore and non-Banyankore neighbours. In fact most of my neighbours do not buy my milk because they also produce milk. Nevertheless, my neighbours help me by producing more milk so that we accumulate volumes that can attract investors — processors or milk traders. However, the main agents of my prosperity are the people of Kampala who buy our milk. Without them our prosperity would not be possible.

Only the other day I was in Malaba. The people there are ‘crying’ because for some reason URA no longer allows the trucks to stop there for cargo verification. The verification is apparently done at destination. This has badly affected local business in Malaba. This led me to remind the rally I addressed at Malaba the meaning of Uganda. This is part of the meaning of Uganda — co-prosperity.

We had had a similar phenomenon in Lukaya when some authorities decided, for good safety reasons, that petrol tankers should not park in the towns like Lukaya. The people in Lukaya would not hear of safety arguments; they seemed to be saying — “better dead than poor”. In whose interests, then, are the elements that parrot tribal and religious sectarianism or chauvinism of any type acting? We should mercilessly expose these agents of our continual under-development.

Besides, the Ugandan market is not enough. Some time ago, we had a glut of milk. The internal market was not enough. The prices of milk went down to sh150 per litre in the Rwakitura area. Right now we have a glut of maize. The internal market is not enough. We need the regional market. The regional market would absorb more of our goods.

The market of Southern Sudan and the Congo, recently, demonstrated this. A lot of energy was injected into our economy by the purchasing power of southern Sudan and Congo, not to mention the East African market. Moreover, the East African market enables us to negotiate for bigger markets worldwide. If you are too small, you cannot credibly negotiate for external markets.

Therefore, I would like to bring to your attention again our persistent efforts for regional integration, leading to an East African Federation, hopefully. We are moving well on the Customs Union for East Africa and on the Common Market. In 2009, our formal merchandise exports to East Africa reached to US$ 397.2 million. Our formal merchandise exports to the whole of the Great Lakes Region including East Africa amount to US$ 728.4 million (including Kenya, Tanzania, Rwanda, Burundi, DR Congo, Sudan, Congo Brazaville, Central African Republic, Zambia and Angola). In other words, our exports to the Great Lakes constituted 46% of our total formal merchandise export earnings in 2009. This figure does not include the informal cross-border exports, which are estimated to be to the magnitude of US$ 1.2b (2009).

On the issue of the maize glut and the abundance of other products of agriculture, I wish to report that our strategy to cope with this is to access bigger markets — East African, African and the global markets. You cannot, however, access these distant markets without processing our agricultural products. Our efforts to attract investment in this area appear to be bearing fruit. Only the other day, I opened a legumes and cereal processing plant in Tororo. Besides, we have mandated UDC and UIRI to deal with this matter. On top of that, we shall distribute maize milling machines to as many sub-counties as possible. We are also trying to attract other companies to get derivatives of maize out of these products.

The sixth point I would like to bring to the attention of delegates concerns our efforts to bring into commercial sector the 68% of the homesteads of Uganda that were identified by the census of 2002 as still being in subsistence farming. We have started different efforts to achieve this including NAADS. Although NAADS has not been implemented as well as we had wanted, it is making some progress.

During my visits, I come across some homesteads that are entering commercial production of citrus fruits, like Okoboi of Kibaale in Palissa and many in Teso, dairy production like the farmers of Kataka Parish in Kibuku, dairy farming and upland rice production like Mr. Charles Opendi of Magoola Sub-county in West Budaama, Wakinya of Buduuda who has been busy with bananas, pigs, dairy cattle, coffee, etc. There are many such examples in the whole country. In spite of the complaints against NAADS officials on account of favouritism in choosing NAADS beneficiaries and overpricing of NAADS materials, I strongly call on Ugandans in the rural areas to learn from those who have implemented these programmes. They are good examples in transformation, the unfairness notwithstanding. The main weakness seems to be poor communication arrangements (okurarika). In future, the local radios should be used to summon NAADS meetings — not just word of mouth through farmer groups, CDO, etc. The word of these does not reach everybody. I am even wondering why NAADS beneficiaries cannot be given cash and they buy the cows, goats, pigs, planting materials, etc, by themselves to eliminate overpricing by tenderers.

Apart from the individuals that are involved in NAADS, there are whole areas that have been transformed. These are areas like Bundibugyo, the Sebei region, some parts of Kanungu, some parts of Kabarole, some parts of Kiruhura, etc. I will ensure that the money for NAADS for subsequent years, starting with the current year, is used in more targeted ways. We may have to alternate; one year mass outreach, a type of poverty alleviation; another year model farmers.

On the negative side, we have the problem of corruption. This evil must be fought in order to save the loss of people’s resources. In my upcountry trips, I come across a lot of this: illegal charges in UPE, USE schools; inflating costs in NAADS projects; stealing of Government drugs; doing shoddy work on roads and public buildings; etc.

Fortunately, I am developing units to deal with this treachery. I have a unit dealing with the stealing of drugs and another unit dealing with shoddy jobs on roads and buildings. A number of Health workers have been arrested on account of stealing drugs, absenteeism from work etc.

In order to involve the party in monitoring Government projects, we included the chairman of the ruling party in monitoring the use of NAADS money at the sub-county. I am sure we shall defeat these challenges as we have defeated many others.

We are beginning to transform the police. The Police, in spite of some rotten elements still in the Force, have been able to arrest the murderers, those who engage in human sacrifice, kidnapping babies, etc. The problem is now the Judiciary. The Judiciary should prioritise the management of these murder cases. Otherwise, the future of Uganda is bright. I thank you. It is now my pleasure to declare the conference open.