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Uganda Direct Economic Involvement
By 1987 the Ugandan government was directly involved in
the
economy through four institutions. First, it owned a
number of
parastatals that had operated as private companies before
being
abandoned by their owners or expropriated by the
government.
Second, the government operated marketing boards to
monitor sales
and regulate prices for agricultural producers. Third, the
government owned the country's major banks, including the
Bank of
Uganda and Uganda Commercial Bank
(see Banking and Currency
, this
ch.). And fourth, the government controlled all imports
and
exports through licensing procedures
(see Foreign Trade and Assistance
, this ch.).
In July 1988, officials announced that they would sell
twenty-two companies that were entirely or partially
governmentowned , in an effort to trim government costs and curb
runaway
inflation. These enterprises included textile mills,
vehicle
import companies, and iron and gold mines. Officials hoped
to
sell some of them to private owners and to undertake joint
ventures with private companies to continue operating
several
others. Among the roughly sixty parastatals that would
remain in
operation after 1989 were several in which the government
planned
to continue as the sole or majority shareholder. These
parastatals included the electric power company, railroads
and
airlines, and cement and steel manufacturers. Banking and
exportimport licensing would remain in government hands, along
with a
substantial number of the nation's hotels. Retail trade
would be
managed almost entirely by the private sector. By late
1989,
however, efforts to privatize parastatal organizations had
just
begun, as personal and political rivalries delayed the
sale of
several lucrative corporations. The International
Development
Association (IDA) awarded Uganda US$16 million to help
improve
the efficiency of government-owned enterprises. Funds
allocated
through this Public Enterprise Project would be used to
pay for
consultancy services and supplies, and to commission a
study of
ways to reform public-sector administration.
By the 1980s, more than 3,500 primary marketing
cooperative
societies serviced most of Uganda's small-scale farmers.
These
cooperatives purchased crops for marketing and export, and
they
distributed consumer goods and agricultural inputs, such
as seeds
and fertilizers. Prices paid by marketing boards for
commodities
such as coffee, tea, and cotton were fairly stable but
often
artificially low, and payments were sometimes delayed
until
several weeks after purchases. Moreover, farmers sometimes
complained that marketing boards applied inconsistent
standards
of quality and that weights and measurements of produce
were
sometimes faulty. In 1989 the government was attempting to
reduce
expensive and inefficient intermediary activity in crop
marketing, and Museveni urged producers to report buyers
who
failed to pay for commodities when they were received.
Data as of December 1990
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