Uganda’s Opposition is calling for an audit into the Shs73Trn public debt to save the economy from plunging into turmoil.
While reading the opposition response to the National Budget Framework Paper 2022/2023 before Parliament’s Budget Committee on Tuesday, Moses Kyaligonza, Principal Policy Analyst Office of Leader of Opposition revealed that the stock of public debt had risen to Shs73.78Trn between June to October 2021.
Kyaligonza added that as a result, the cost of managing the debt has grown from Shs8.58Trn in 2017/2018 to Shs15.11Trn in 2021/2022.
“There is need for a public, extensive and participatory inquiry of committed debt beyond the initiative undertaken by Ministry of Finance. The debt audit should target the entire cycle of identification, appraisal, negotiations, approval, implementation, monitoring and evaluation,” said Kyaligonza.
The Opposition also called for solutions to the economy leakages through tax expenditures, undisbursed loans, interest payments and tax exemptions that have hit the tune of Shs7.722Trn.
The Ministry of Finance was pointed out as the biggest tax defaulter owing Uganda Revenue Authority taxes to a tune of Shs151.788Bn as at October 2021, followed by Office of Prime Minister Shs30.925Bn, Ministry of Energy Shs13.280Bn.
Muwanga Kivumbi, Shadow Minister Finance urged Government to address capital flight by enacting and enforcing local content laws and policies whose absence he says has seen many local businesses close shop, while international businesses flourish.
He said, “Japan deliberately promoted Toyota, India Tata, South Korea Sumsang, but on our watch, we have seen every local industry die. We watched Roofing grow and Sembule Steel Mills went down, we have seen local banks fail as foreign banks grow. So there is need for us o have this debate on how we can grow our local industry in order to bridge the capital flight that is hemorrhage.”
The Opposition highlighted 36 major road construction projects going on in Uganda and of these, 23 are undertaken by Chinese contractors with the rest going to other foreign contractors.
According to the Opposition in 2020/2021 capital inflow into Uganda was to a tune of US$890.41Mn about Shs3.138Trn, but of this, US$599.71Mn approximately Shs2.113Trn left the country.
Now, the Opposition wants the Local Content law developed and passed so as to maximize utilization of local expertise in all undertakings where public funds are utilized.
“That is why for us, even if we don’t agree with the model, we think the effort to reward some construction contracts to UPDF is a positive step. If you have an army without war, please engage it. But our issue is only that, make it competitive, don’t be discretionary, let them bid work on professional basis and let them get work competitively,” said Kivumbi.
