UTL saga, Swimming with the Sharks

Saturday, July 6, 2019

The on-going controversies, surrounding the operations, commercial viability, net-worth, indebtedness, of the once state owned Uganda Telecommunications Limited (Utl), and the legal powers of its government appointed Administrator, stinks. The trails so far, appear to point towards the old adage of swimming with the sharks, or perhaps, even sadly, a war between jackals and hounds, in insider dealings to undercut each other. Ugandans must remain and maintain high alert and guard to stop being short-changed by public officials as has happened in the past.

Those who have followed the performance, failure and eventual divestiture of public enterprises since 1993, may recall that much of the problems were associated with incompetent and corrupt management including boards of directors, lack of credible and appropriate business strategy and plans, and perennial political interference.

As for Utl, government long ago decided not to  liquidate it because of national strategic considerations, and invited core investors, who along the way fell by the wayside mainly because of above tendencies, the last being Ucom, a Libyan government company, which unilaterally pulled out in April 2017. Soon after, government asked court for permission to take over Utl as the sole owner, and was granted powers to appoint an Administrator, with a directive to evaluate and make a business turn-around.

Since that time, the term of the Administrator has been renewed thrice, the latest being in November 2018 by the ministry of Finance, and not the Courts of law as being made to appear. However, and regardless of the legalese, the current controversy was provoked when the Administrator refused to provide credible updates on Utl to government.

It appears, the usual jackals, have been hovering over Utl’s many idle assets including the undersea cable, extensive cable network, earth satellite stations, land, buildings, and massive businesses with government ministries and agencies, currently mismanaged and under-utilised. These jackals, would most likely prefer, that they penetrate and exploit the legal and administrative loopholes, laxity and public administration malfeasance to have Utl liquidated rather revamped, because then, they can have their hands on its assets for a song. 

This explains the un-ending movement in circles by the concerned officials contrary to the cabinet decision, backed by a qualified recommendation by PWC, that a credible, competent and capable core investor be found in addition to revamping management, so as to build a new and working business plan, after all, new entrant telecom companies like MTN, Airtel and Orange seem to be breaking even and lucratively profitable.

Unlike in the past, once beaten twice shy, President Museveni has learnt from past bitter lessons, and is trading more carefully on further liberalization, privatization and divesture even when the economy is private sector-led. While the Attorney General is the principal legal advisor to government, from past experiences, even that ‘opinion’ isn’t infallible or tainted, and should be subjected to strict and transparent scrutiny.

It should be recalled that a few years ago an AG baffled the country with a legal opinion that petroleum agreements with private investors shouldn’t be made public or even to parliament which caused unnecessary controversies. Even now, the opinion that the Administrator’s power is sacrosanct should be taken with a pinch of salt.

Most absurd, and perhaps not known to many people, the Administrator asked twice in writing to have his term renewed for ix months, but got cleverer when Matia Kasaija travelled abroad, and got a junior minister who was acting, to have the contract not only renewed, but given a whole a year. It would be interesting to know the basis of a year’s extension, particularly, when since April 2017, the Administrator was being given only six months at a time!

The civil servants, schooled in careerism, devoid of patriotism, and taking pride in ethno-political connections, build networks that help them run rings around ministers who are supposed to supervise them. The litany of public enterprises that were deliberately run down by public officials, who were the lawful custodians, and presumably using the law, are too many to be listed here. Nevertheless, the Uganda Commercial Bank, Cooperative bank, Uganda Airlines Corporation, Uganda Railways Corporation, Uganda Grain Millers, African Textile Mills, and Kilembe Mines sadly quickly come to mind.

With the clear guidance from the President, based on a cabinet decision, there should be no more moving around in circles without making appropriate decisions over UTL. And many believe that the mobilization underway including enlisting an obfuscating Uganda Law Society (ULS) and lawyers in private practice to buttress the AG’s legal opinion involving big money is suspect, to say the least.

And bearing in mind that there have been many instances in the past when legal opinions rendered by attorney generals have been successfully challenged in courts of law, it is within our rights as citizens to question the professionalism and integrity of those decisions. The cartel of crooks that appear entrenched in Uganda, exploiting complex of government machinery, decision making and the law to perpetuate self-aggrandizement, ought to be exposed and dismantled.