The resource curse, penetrating Uganda!

 Another Africa country joined the list of Resource cursed countries

Image result for oil and gas

Some ideas for giving emerging economies a fighting chance against the resource curse have been suggested by different scholars and schools of thought. However, the resource curse seems to be penetrating most African countries including Uganda and Nigeria. The signs are well visible to the naked eye. According to Wikipedia, the resource curse, also known as the paradox of plenty, refers to the paradox that countries with an abundance of natural resources (like fossil fuels and certain minerals), tend to have less economic growth, less democracy, and worse development outcomes than countries with fewer natural resources. There are many theories and much academic debate about the reasons for and exceptions to these adverse outcomes. Most experts believe the resource curse is not universal or inevitable but affects certain types of countries or regions under certain conditions.

Uganda’s natural resource base, is one of the richest and most diverse in Africa. Uganda has proven crude oil reserves of 2.5 billion barrels and the refinery is expected to initially process 30,000 bbl/day of crude oil, increasing to 60,000 bbl/day before 2020 (However, no mining has started as of today). Uganda produces over 20millin tons of limestone per annum, 10 million tons of salt per annum, Gold is widely distributed in over four (4) districts, lead, hydropower, arable land, natural gas, and with over 10 National parks which contain the big five.

Uganda, as we know it, is one of the region’s newest petrol-states, the government however favours using revenue to improve infrastructure and generate industrial development. However, there is growing scepticism surrounding this approach as based to the increasing level of corruption at the top most institutions of government, increasing poverty levels, a crumbling democracy filled with mafias (it’s like we are back in the 50s). David Ross Olanya, highlighted in his paper (Will Uganda succumb to the resource curse? Critical reflections), and he pointed out concerns about prudent management of oil revenue in Uganda and added that they are very real because of the country’s degree of vulnerability to a ‘resource curse’, specifically its weak institutions and governance, social fragmentation, lack of political inclusiveness, and the opacity of Production Sharing Agreements (PSAs) signed by politicians and oil companies.

Following Uganda’s discovery of oil deposits in 2006, the country’s development prospects looked higher than ever before. However, development experiences from oil-rich countries in Africa raised concerns that Uganda could suffer oil curse – a situation in which extraction of oil increases poverty and misery to majority of the people instead of leading to improvement in livelihoods for all. In about 12 years down the road, the prospects of increased growth, job opportunities, economic stability, reduction in poverty levels have started to fade even among the elite populace. For a country with the youngest population, and with young people graduating in thousands every single year, this is a disaster as the government has steadily brewed an unemployed generation of desperate young people and this can never be good for any economy as unemployment and being idle are some of the root causes of instability, increased theft and murders, and consequently a poor economy.

The mismanagement of Uganda resources which has led to resource curse, is already at its peak. With the ruling party NRM (National Resistance Movement) move to remove presidential age limits and the president signing the bill, Life presidency has been made possible in the Pearl of Africa with no doubt. This has already created a rift between those for and those against the removal of Article 102(b) and this in one way or the other is already affecting the economy, fuel prices are on a super hike, prices of commodities are increasing daily and the national bank claims it’s not a case of inflation, this, I call the resource curse starting to wear off on our dear country. In  a country where people’s livelihoods are inextricably linked to sound natural resource management, it is therefore essential that Parliament and government, in their oversight and legislative/executive role, ensure that natural resource management is at the centre of good governance and economic development, otherwise the whole country may be doomed.

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