Experts tell government to invest oil money in more sectors

Financial experts have questioned President Museveni’s proposal to allocate billions of dollars from oil revenues solely to infrastructure development rather than consumption.

Financial experts say that it is not a good idea to develop only infrastructure and ignore the issue of social development. In their opinion, these two areas must go hand in hand.

“Our priority is infrastructure development that outpaces the quality of the people you want to serve. Those who have travelled have seen scenarios where a road is built to improve access to agricultural markets, but instead people are drying cassava and millet on it,” Patrick Katabazi, coordinator of the Uganda Parliamentary Forum on Social Protection, said in an interview last week.

He added: “You travel a very long distance and no vehicle has passed you carrying anything, and yet the road is mainly used for drying. The reason is that yes, you have a good road, but the capacity, the quality of people in the community and their capacity does not match this good infrastructure that has been created.”

Mr Fred Muhumunza, an economist and lecturer in economics at Makerere University, said the oil money should be used to settle the huge national debt the country is grappling with.
He added that the majority of the debt was incurred due to the development of the aforementioned infrastructure.

“There are debts to be settled, but infrastructure projects may not be ready. We don’t want to borrow because we have money. If the policy is to use oil money only for infrastructure, we need to carefully consider future borrowing needs,” he said.

Edition
According to the Auditor General’s report, Uganda’s national debt stood at about 96.1 trillion shillings as of June last year. Of this, 44.6 trillion shillings comes from within the country and 52.8 trillion shillings comes from abroad.

Mr Julius Byaruhanga, Director of Advocacy Policy at Private Sector Foundation Uganda (PSFU), said the money should also be used to develop the innovation and science sector, which has become an important part of everyday life.

Last month, President Museveni, in his budget speech, assured the country that when oil money finally starts flowing, all of it will go towards infrastructure development.

“This oil money will never be used for consumption. It will only be used for the development of infrastructure and science. That is why strategic items such as railways and irrigation will be financed directly by us,” the head of state promised.

The first delivery of oil to Uganda is expected next year.