SPEECH

BY

H.E. YOWERI KAGUTA MUSEVENI

ON

NATIONAL CONSULTATIVE BUDGET WORKSHOP FOR FINANCIAL YEAR 2014/2015

16TH JANUARY, 2014

AT SERENA INTERNATIONAL CONFERENCE CENTRE,

His Excellency the Vice President of ;

Rt. Hon. Speaker of Parliament;

Rt. Hon. Prime Minister;

Rt. Hon. Deputy Prime Minister;

Hon. Ministers;

Hon. Members of Parliament;

Permanent Secretaries;

Development Partners;

Local Council Vice Chairpersons;

Mayors;

Resident District Commissioners;

Chief Accounting Officers;

Uganda’s Ambassadors Abroad

Civil Society Representatives;

Ladies and Gentlemen.

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Whenever I hear people talking about budgeting, I immediately remember the Runyankore proverb: “Garya embibo gashekyera ekiteme” ─ “the teeth of the unwise eat the seeds one would have kept for the planting season, on account of acute hunger at that given moment and when the time for planting comes, the same teeth smile helplessly at the prepared garden because, by that time, one has no seeds to plant there”. You can see how rich our languages are compared to English. What the proverb says in 4 words, it takes 51 words to say in English!! That, however, is a topic for another day. The message in the proverb is that however hungry you may be, you should never eat the seeds. The seeds represent future prosperity.

This is, however, a point many people do not easily see. Hence, the pressure for salaries, new districts, unnecessary travels, etc. Expenditure on items like salaries and new districts may lubricate the economy by putting money in the hands of public servants who, then, spend it in the

2 economy, thereby increasing the purchasing power of the population provided you have dealt with the basics of the economy. The basics of the economy, apart from peace, are: macro-economic stability, electricity, the roads, the railways, ICT infrastructure, piped water for, at least, the towns and the human resource development (education and health).

It is this frame of mind that guides me when it comes to prioritization. That is what I did when I led the freedom struggle by emphasizing the guns, their ammunition and the recruits (the soldiers). With these, I could get the rest ─ food, medicine, clothes, publicity, etc.

Similarly, with financial budgeting, when we deal with the basics first, then things move in a better way. Since 2006, but, particularly since last year, I insisted on roads, electricity and scientific innovation.

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Out of the shs. 9,000 billion we shall collect this financial year, shs. 3,015 billion will go to these three. The impact of that decision is very clear. Major towns and trading centres are now connected to electricity or are about to be connected. These include: Moroto, Katakwi, Amuria, Namalu, Nakapiripirit, Amudat, Amolatar, Kalak, Dokolo, Otuke, Adjumani, Moyo, Bibia, Bundibugyo, Kanungu, Kihihi, Nyakishenyi, Kisizi, Kamwezi, Kyempene, Kisoro, Bukanga, Isingiro, Kiganda, Nabingoora, Nakitoma, Awere, Amuru etc, etc.

On the side of the roads, we have now tarmacked:  Kampala-Mityana,  Kampala-,  Kampala-Kafu,  Isingiro--Kikagate,  Ishaka-Kagamba,  Tororo-Mbale-Soroti,  Jinja-Kayunga, etc, etc.

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Using, solely, the funds of the Uganda Government and by co-funding with others, we have done:  Arua-Oraba;  Gulu-Atiak-Bibia;  Nyakahita-Kamwengye-Fort-Portal;  Masaka-Mbarara;  Mbarara-Ntungamo-Katuna;  Kabale-Kisoro;  Iganga-Malaba-Busia etc, etc.

There is the long list of the roads we have budgeted to do that include:  Mpigi-Kanoni-Ssembabule;  Mukono-Katosi-Nyenga;  Musita-Nankoma-Namayingo-Majanji-Busia;  Ntungamo-Mirama Hill-Kakitumba;  Mubende-Kakumiro-Kagadi;  Olwiyo-Anaka-Koch-Goma-Gulu-Kitgum-Musingo, Kigumba- Masindi-Hoima-Kagadi-Kyenjojo, etc, etc.

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On top of these road and electricity transmission (wires) projects, we have added the electricity generating projects: Karuma, Isimba, Ayago and many mini-hydros. Then, there is the issue of the railways. We must repair the old railway lines and build a new standard gauge railway to South Sudan, Kasese and to the Rwanda border. The reasons for emphasizing the roads, electricity, the railway, the ICT, the piped water for, at least, the major towns and the development of the human resource (Education and Health), apart from being services to the human being, is in order to lower the costs of doing business in Uganda in order to improve profitability for enterprises, thereby attract more businesses to Uganda, create more employment, widen the tax base and provide quality goods and services to Ugandans and for export. Without doing this, the economy will not grow and social-economic transformation will not take place

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A 40ft container costs US $ 1,600 to be transported from Shanghai to Beijing, a distance of 1,238 miles while a similar container would cost US $ 3,700 to be transported from Mombasa to Kampala a distance of 1,212 miles. A unit of industrial electricity costs US cents 8 in China while in Uganda it costs US cents 12.4 and in Kenya it costs US cents 13.7. We cannot favourably compete if we maintain disadvantages to our producers.

In the coming budgets, we shall have to also deal with the long-standing issue of water ─ any type of water, even the unsterilized water ─ for some of the water ─ stressed areas like Isingiro, Bukanga, Kooki and some areas of Mayuge. These are mountain areas where bore-holes are not applicable and yet these areas do not have mountain springs that can be converted to gravity flow schemes like in other areas.

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They also happen to be rich in minerals which makes even the little surface water undrinkable for human beings without the expensive processing of these salts out of the water.

Here, we shall have to pull water from river Kagera or Lake Victoria respectively, clean it and give it to the people. I am, however, told that chlorinated water is not good for livestock. That means that we shall have to work on a separate solution for water for production ─ livestock and crops.

Then there is the issue of supplying breeding and planting materials to the six million or so rural households that are, finally, ready to convert from subsistence to commercial agriculture. We estimated shs 810 billion for this purpose. In this financial year we provided only shs. 57 billion for this purpose.

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With fertilizers from Tororo and, later on, with the fertilizers from our own oil and gas, agricultural production will reach new very high levels. These high levels of agricultural production will need processing ─ agro- processing. The processing will be done by the private sector. The private sector will be attracted by the low levels of production costs occasioned by better roads, the railways, electricity and ICT backbone. However, the government must also provide properly serviced industrial parks so that our investors do not have to incur costs of draining swamps, making roads, pulling electricity, pulling water and even being required to provide railway line sidings. In conclusion, my advice to the government is to prioritize the following eleven areas: 1. Defence and Security; 2. Electricity; 3. Roads; 4. The Railways;

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5. ICT; 6. Piped water for, at least, the major towns; 7. Human resource development; 8. Water for high land water – stressed areas; 9. Buying breeding and planting materials in order to boost agricultural production; 10. Industrial parks; 11. Scientific innovation

This is the type of budget that is for growth and social- economic transformation. With income from oil and gas, this budget will become easier.

I thank you and wish you good luck.

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