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NEW YEAR MESSAGE

NEW YEAR MESSAGE

2017

BY

H.E. Yoweri Kaguta Museveni
PRESIDENT OF THE REPUBLIC OF UGANDA

31st December, 2016
Fellow Ugandans,

I greet all of you the people of Uganda and congratulate you on finishing the year 2016 and wish you a prosperous 2017. I extend condolences to the families who lost their dear ones in the year that is just ended.

During this year of 2016, we had successful general and local government elections.  I congratulate Ugandans for voting their leaders peacefully.  I also congratulate leaders who were elected.  I call upon them to stay in touch with their communities as they will achieve alot when they work together.

At the beginning of this term of office, 2016-2021, I issued 23 guidelines/directives to government and so far in six months, the following have been achieved:

Finalized a plan for re-establishing the National Carrier (Uganda Airlines). This will reduce on the financial “haemorrhage” (donation) to other airlines by Ugandans and those travelling to Uganda.

Investment Climate Advisory and Management ─ Ministry of Finance has allocated Shs. 410 million to generating  the statistical data for investors who wish to invest in the country.  Availability of ready information will quicken decision making by investors.

Construction of more than 100 water schemes across the country in some of the following areas: Bukwo GFS; Bukedea, Parombo, Akoro, Olirim II, Bududa II, Bukwo II, Shuuku-Matsyoro GFS, Ogili GFS, Kiboga, Ruti/Rugando, Loro, Padibe, Pabbo, Rwashamaire TC, Nyamunuka TC, Amudat, Bibia/Elegu, Ovujo, Oyam, Nyahuka, Kasagama and Kaliiro, etc.

Provision of Water for Production: Expansion of Mubuku, Kibiimba and Doha schemes, completion of Kaharo gravity water scheme in Kabale.  The following are planned: Andibo dam in Nebbi district, Rwengaaju irrigation scheme in Kabarole district, Ongole dam in Katakwi, Mabira dam in Mbarara, Olweny irrigation scheme in Lira district and Leyedam in Kole district and a number of small min-irrigation schemes will soon be under way to mitigate the current pattern of rainfall and stop depending on nature but use irrigation system.  In order not to continue being dependent on nature, we are going to start with more irrigation schemes around mountain Rwenzori, Mt. Elgon and the Agoro hills.  These are easier because we use gravity on account of the good gradient and just channel the water to the required points.  With regard to the low-lands, we are encouraging the manufacture within country or, at least, assembling within country of affordable solar-powered water pumps.  I call upon individuals who have means to equip their farms with these pumps at their cost.  Uganda Development Bank (UDB) should look into the possibility of using the money we give them to fund such acquisitions with low interest loans; may be 12% per annum or there about.  Using government money, we shall slowly start equipping villages with communal solar-powered water pumps.  We have, indeed, already started.  There are already solar powered water pumps at Kandago in Rukiga,  Nyadri in Maracha, Kololo in Adjumani, Inomo in Apac, Kabira in Rakai, Kibenyeya in Hoima, etc.  These will be scaled up from being only water for consumption to irrigation this coming financial year (2017/18).   130 new water irrigation schemes are planned for FY 2017/18, across the country.

This is in order to immunize ourselves against the erraticness of the rains.  This effort of irrigation, must, however, go hand in hand with the wetlands preservation and restoration as well as protecting all our fresh water bodies (Lakes and rivers).  Where will, then, the water come from if we do not protect the water bodies?

Granting Oil Production Licenses:
Eight (8) production licenses were granted in August and these include: Mputa-Nzizi-Waraga, Kasamene-Wairindi, Kogogole-Ngara, Nsoga, Ngege fields operated by Tullow, Gunya, Ngiri, Jobi-Rii operated by Total.

Introduction of biometric registration of all small scale miners;
Allocating location licenses to small scale miners;
Expand the licensing regime that will streamline the small scale miners and the heavy investors in the mineral sector.

Government is in talks with the financiers of Bujagali to bring down the cost of power to affordable rates for industries.  The other dams do not have that problem.  The power from Nalubaale power station is now at 1.04US Cents, since the loan for constructing Nalubaale power station has been fully paid back.  That of Bujagali is at 11US cents.

Right now, we, actually, have a surplus of electricity and we are building more dams as you know.  Our plan is to build more and more dams, not only on all the sites on the Nile River (Ayago-840MW, Oriang-392MW, Uhuru-400MW, Kiba- 300MW etc.) but also to develop over 40 mini-hydro dams, already identified across the country.  Some of them are already under construction.  These are: Nyagak III 5.4MW, Nyamwamba 9MW, Muvumba 5.4MW, Achwa/Agago 83MW, etc.

With abundant and cheaper power, our pace of industrialization will pick up. We are going to provide electricity at the cost of 5 American cents per unit to manufacturers. More electricity and better network of roads will mean faster industrialization. As projected by the National Planning Authority (NPA), the middle income status will be attained by 2020.

I have told you before, how Uganda was bleeding on account of unnecessary and excessive importing (buying-kugula) and very little selling (kutuunda).  What are called “rich people” in Uganda, specialize, not in building factories or hotels, but, in building shopping arcades that specialize in selling to our people all sorts of imported goods. As a consequence of this, Uganda donates to China US$ 875 million per year, to India US$1.154 billion per year, to EU US$637 million per year, to USA US$ 89 million per year, to South Africa US$ 257 million per year, to UAE US$406 million per year, etc.  Yet our own exports to China are only US$54.7 million per year, to India only 24.8 million per year, to South Africa only US$4.7 million per year, to UAE only US$62.6 million per year.  It is only to the EU that we export US$433 million per year and to the COMESA-EAC that we exported goods and services worth of US$2 billion (in 2015).  In this hemorrhage, textiles take US$888 million per year, cars US$568.7 million per year, leather goods US$0.22 million per year, alcohol and beverages took US$ 68 million (2015), foods and food extracts took US$612 million (2015).  This is not only hemorrhage of money but also of jobs.  Building up our textile industry, which we have already started on in modest ways, would not only save the US$888 million in imports but would also create for us a total of 45,000 jobs from about 25- 30 factories, each the size of Nytil, fully operational. As a result, KACITA group was sent to Ethiopia by me to study and came back converted.  They are now ready to work with government in establishing factories for exports instead of imports.

Industrialization is, therefore, both an instrument of liberation and a means of achieving prosperity. Additionally, using our comparative advantages, we would also export to other countries, thereby earning even more money and creating even more jobs. We cannot blame our importers.  Until recently, the basics that are needed to support manufacturing were not in place.  Today some of them are: electricity, better roads, a more educated workforce, etc.  It is time to, therefore, launch a massive effort for industrialization.

Fast tracking of Standard Gauge Railway to reduce the cost of transport.  As you know, we are working with our relatives in Kenya to modernize the railway by building the Standard Gauge Railway.  
This will bring the cost of transport for a 32 metric tonnes container to Mombasa from US dollars 3500 by road, to US dollars 1650 by railway and it will only take one day compared to the present railway which takes 21 days.  It will also save our roads from damage caused by the huge lorries carrying what should be ferried by the train.

This is all to do with manufacturing.  As I repeatedly tell you, manufacturing is one of the four sectors that comprise our economy.  The other three are:  agriculture, services and ICT.   Peace, electricity and improved road network are stimulating the process of manufacturing.  The same stimuli influence services to some extent.  Agriculture is, of course, linked to industry through agro-processing.  

However, the biggest challenge we have in agriculture is cultural and historical.  According to the census of both 2001 and 2014, about 68% of our homesteads are still in subsistence agriculture (only working for food but not working for money).  Only 32% of the homesteads are in the money economy.  Through Operation Wealth Creation, we are determined to change this.  Coffee, fruit and/or tea seedlings are being given to all the homesteads with land of two acres and above.  Our ideal model, as you know, is four acres.  
Two acres, however, can also do something.  In some areas, they grow cocoa.  Each home must have, at least, one acre of food crops especially, drought resistant crops (cassava, bananas, Irish potatoes, rice etc).  As far as coffee is concerned, a tissue culture laboratory is going to be built at Kituuza so that we can multiply high quality, disease-free seedlings industrially and quickly.  
OWC has been stopped from being everywhere and ending up being nowhere.  

We are concentrating on, initially, the four cash-crops ─ coffee, cocoa, fruits and tea.  As time goes on, we shall get them to distribute chicken, dairy cattle and pigs.  The homesteads with one acre or less, will be helped with poultry for eggs, mushroom growing, onions, pigs and zero-grazing dairy cattle.  Every homestead must be involved in money making.  We cannot accept spectators in this effort.  Maintaining 68% of our homesteads in pre-capitalist modes of production is a wrong form of conservation.  Let us conserve other assets such as wetlands, forests, national parks, etc., but not under development.

The services sector is growing very well spurred on by peace and better roads.  It is growing at the rate of 5.3% per annum.   Especially for tourism, what is now lacking is publicity.
The Tourism Board will aggressively inform the world about our unique climate as well as flora and fauna.  Services money is easy money for us, especially tourism.  

The ICT sector has been facilitated by the building of the ICT backbone and the undersea cables to Kenya and Tanzania.   This has lowered the cost of internet bandwidth from US$1,200 per month to US$ 300 per month and is expected to reduce further to US$150 per month within the next 12 months.  

Uganda Investment Authority (UIA) should, therefore, use this new capacity to attract new investors in this sector.

With our brothers and sisters in Africa, through EAC and COMESA, we have already built regional markets for our producers. They can export to the region. We have also negotiated for external markets such as AGOA, EBA, the access to the Chinese and the Indian markets, etc.

All these efforts will translate into more jobs for our youth. Uganda already has 3,100 factories and 3,475 tourism related companies and assets.  The two are already employing about 1.1 million people.   
This has been achieved in spite of the bottlenecks of lack of electricity and high transport costs in the past.  Now that we are addressing the issues of electricity and transport costs, our progress will be faster.

Conclusion
Uganda has been at peace for the first time in 500 years, for many years now.  Uganda will remain at peace.  Nobody has the capacity to disturb this, however hard they might try.  Therefore, my dear Ugandans, I can confidently tell you that the future is bright.  

If we love one another, celebrate our diversity, resist division and stay united, we will achieve greatness. Let us all join hands and declare the New Year to be our year of prosperity. The year of building on the strong foundation we have laid to secure Uganda's future.

I wish you all a happy and prosperous New Year Two Thousand and Seventeen.