the economy is leaking at the rate of many foreign-manufactured $100 pens


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Some of the Pens AND Writing Implements (Photo: Simon Kaheru)

The journalist who did a story on the expenditure of the Central Bank of Uganda (BOU) buying Writing Implements as gift items costing about US$100 each, made one of my days this week.

We refer to them as ‘Writing Implements’ rather than just pens because at US$100 each we need to introduce some grandeur into the conversation.

The journalist in question, bless him, will receive from my personal account a box of pens (not ‘Writing Implements’) made in Uganda. That’s a modest gift in monetary terms, but quite meaningful because I value pens quite highly.

Those who have sat close to me during meetings where pens are placed on the table before you walk in must have noticed how quickly I latch onto any available and carry them off with me at the end.

My collection of pens is mentioned in my Last Will and Testament, though I won’t reveal here who is destined to receive them after I place my last full-stop.

The journalist picked up on an issue raised elsewhere and highlighted a niggling matter that keeps coming up whenever we discuss this economy and how difficult things seem to be.

On one of our online professional discussion forums populated by marketing and merchandising people, the story created a healthy discussion.

Some explained that high value pens of that nature were justified under certain circumstances, others simply declared it a waste of money, and elsewhere there was suspicion of foul play.

My joy with the story was because it was another wake up call to our economists – which is not to say that I am accusing the Bank of Uganda people of being economists.

I went to read the Bank of Uganda Act of 1993 and found it’s description saying, “An Act…for promoting the stability of the currency and a sound financial structure conducive to a balanced and sustained rate of growth of the economy and for other purposes…”

Among other things, that BOU Act says the functions of the bank shall be to formulate and implement monetary policy directed to economic objectives of achieving and maintaining economic stability, including: “act as financial adviser to the Government and manager of public debt”.

The journalist who did this story of BOU and the US$100 pens brought it to the fore on many fronts – my point of focus being the purchase of foreign items as corporate gifts; more importantly, that purchase of foreign-manufactured gifts by a body that should be mindful of how this economy is doing.

One argument on our forums was that the pens were probably Mont Blanc (Yes – I own one of those as well, valued at over US$300 at purchase and given to me as a gift from a foreign Multi-national company some years ago).

Another person even pointed out that the total cost of the Procurement was too low to merit so much chatter – something in the region of Ushs125million.

I chose not to focus on those points.

Again: the purchase of foreign-manufactured gifts by anyone in Uganda will continue to be our downfall. If the BOU people can’t calculate how many jobs can be created or sustained by an order of manufacturing merchandising items at Ushs125million, then we need more Ugandans to do courses in Economics and PAY ATTENTION IN CLASS.

The BOU people know how much money we have in circulation and, probably, where exactly it might be at any given time ’t’. If anyone knows the impact of sending Ushs125million out of the country, it should be them.

Yes – the pens were supplied by a Ugandan-owned firm or company, and money was earned from logistics et al; but surely an economist somewhere can extrapolate (those words studied people use with ease, that people like me borrow every so often when facing a US$100 writing implement) the economic impact of keeping that money in circulation here.

Even if the gifts were going to the highest ranking Central Bank Governors from the richest countries in the world, would they not appreciate a well-made item crafted by the hands of the legendary wood carvers from Bunyoro, using some of our high grade Mivule or Musambiya trees?

That’s just an example – probably not a realistic one. But if the extrapolating economists got that Ushs125million and put it through their intellectual machines, they would find ways of making us DEVELOP an industry producing merchandising items that eventually the countries where US$100 pens are made would buy for THEIR friends using THEIR equivalent of Ushs125million.

That way, the BOU Ushs125million would be used to make Uganda earn many different rounds of Ushs125million coming in from OTHER ECONOMIES.

Afraid of popping a vein in my head at all these thoughts, I went searching for a copy of a Local Content Bill that I have heard about, so I could contribute by sharing it with the BOU people for the next time they have Ushs125million on their massive account slated for the purchase of Writing Implements.

The internet couldn’t find it readily. I tweeted, called and WhatsApped a few people who I felt should have the Local Content Bill 2017 at their fingertips – not one of them responded well enough within the first few hours.

But eventually, I found a helpful Ugandan who works with the Parliament of Uganda (not a Member of Parliament) and the person shared a version of the relevant document.

Actually, the person shared the ‘Motion Seeking Leave of Parliament To Introduce A Private Member’s Bill Entitled “The Local Content Bill, 2017”’.

I applaud the Parliamentarian who is moving this Bill, for noting that “whereas the Government of Uganda formulated the ‘Buy Uganda Build Uganda (BUBU) policy…(it) has not been fully implemented.” and expressing concern that “Uganda currently does not have legislation aimed at promoting Ugandan manufacturers or service providers to compete favorably with international goods and service providers.”

You have to read the rest of it on your own, and then give it the support it needs (coming soon to a blog post near you).

I pondered over why this required a private member rather than a front bencher. A front bencher who was involved in the NRM Manifesto.

The vein in the brain started throbbing again.

I am one of those Ugandans who finds it hard to pay bills and obligations on time because of slow, non-existent or absent payments from clients (government inclusive), besides my own inefficiencies. Still, I surely have a right to be miffed by the procurement of foreign-manufactured gifts by a government body, and thankfully, I can put it in writing using an ordinary pen procured by myself in Uganda, made in Uganda, employing a Ugandan somewhere.

the rise of the shareholder activist versus capital markets trade


Activism adapted from adweek.com
(Pic adapted from http://www.adweek.com)

I BUMPED into the phrase ‘Shareholder Activist’ last week with some irritation; more accurately, it found its way into my phone via WhatsApp, which, these days, is my main source of intellectual garbage, high-strung emotion, low-level drama and occasional amusements.

After reading the term I headed to Google to confirm that the conversation we were having in that Group made sense, and found that there is an official term with quite a different meaning from the way everyone was talking about this particular ‘Shareholder Activist’.

The recognised term is ‘Activist Shareholders’, defined as “one using an equity stake in a corporation to put public pressure on its management.

The conversation came about because three of our pitifully few listed companies in this country were holding AGMs (‘Annual General Meetings’ to you, if you’re the kind that crammed your way through school) last week.

Company shareholders (of listed companies or private ones) are supposed to be active, especially during this most important meeting when they get to hold the company Board and Management Team to account.

Unlike what happens for about eleven months and twenty nine days of the year, the shareholder gets to attend the AGM one day and in a structured manner address the Board of the organisation.

By that time, the accounts and Annual Report would have been circulated so the shareholders read through them in detail and then raise issues, observations and suggestions while attending the meeting itself.

During the rest of the year, the Shareholder is represented by the Board of Directors which on a monthly or other periodical basis keeps tabs on the Management Team and ensures they are sticking to their approved strategy – approved, that is, by the Board of Directors on behalf of the shareholders.

See, the shareholders entrust the Board with approving and supervising that strategy, and it is this trust that they vote on during AGMs when they select their respective Board Members. The shareholders, normally by voting publicly during the AGM but sometimes following prescribed methodologies built into the company registration documents, get to choose who will be Director of a Company. The Director, “directs” – showing the management team where, in general, they should set their sights or in which direction they should go.

The Management Team or Executive Management, “manages” the company or “executes” the strategies as approved by the Directors.

It is a system that works beautifully if followed carefully and, as the phrase goes, to the letter.

Sometimes, though, there will be incidents such as those occasioned by the Activist Shareholder who, rather than walk within the marked lines, will take up as many other tools as possible and rocks the boat – or tries to.

Sometimes they take legal action – which is respectable and even, in some instances, admirable.

Other times they will rally shareholder troops and attempt a mutiny during the AGM – also admirable for the mobilisation skills on display, if successful.

Then there are the times the ‘Activist Shareholder’ does the despicable and goes after the very entity that, in essence, feeds him or her.

Until they have dug deeper, the ordinary onlooker will be confounded by those times the ‘Activist Shareholder’ attacks the very same company whose share value would ensure him or her (the ‘Activist Shareholder’) a return on the shareholding investment they made when they bought shares.

See, people buy shares in public (and private) companies in the hope that they will perform well, increase in value, make a profit, and pay them (the people who have bought shares) dividends every year until such a time as the initial investment has been paid back and then the shareholder is earning a profit.

Many of us don’t realise quite how this works, and how important it is for the company in which we have shares to perform well so that it pays back our investment in those shares, while also providing the service or product it was principally set up to provide.

A few weeks ago, ahead of last week’s AGMs, someone in a WhatsApp Group identified three people who they claimed would be at the centre of controversy during the meetings. Their shareholding in the companies involved, the WhatsApp Group stated, was so small that the only reason they had invested was to gain notoriety from their controversial actions during the public, much-publicised AGMs.

It didn’t happen the way this person predicted or feared, but this time round we still saw Activism but of a more despicable kind. A very lengthy and elaborate missive did the rounds with well-stated accusations that would obviously be difficult for the ordinary person to authenticate or verify.

On cutting through a few of them, however, by the second page it was pretty obvious where the piece was heading, but one read on (past tense) hoping to be disappointed by finding it to be hard hitting and factual in that way that would turn a shareholder’s fortunes for the better.

Sadly, it didn’t. It could have probably done quite the reverse in a market with few listed companies and a rather jittery, uninformed, impressionable public.

Luckily, instead, I saw WhatsApp Groups erupting in unflattering commentary that somebody quite recently labelled “intellectual garbage, high-strung emotion, low-level drama and occasional amusements”.

In real life, share prices stayed the way they were and shareholders queued up for their dividends then retired home to wait for next year. The Activists are at bay for now, till the next opportunity arises…

Follow the occasional Twitter hashtag #EconomicsUG. 

pearls from pigs; the pork fest in June should be more than just a BBQ


Like most Ugandans, my affinity for the cooked flesh of a pig can take on legendary proportions if dieticians and medical professionals look the other way.

Whether it is roasted, fried, stewed or even stood in the sun for just long enough to kill off all possibility of disease, pork is a welcome item on any menu I come into contact with.

In December last year the International Livestock Research Institute (ILRI) announced that Uganda is the biggest consumer of pork on the continent. Most weekends in most of our towns will appear to confirm this – both in domestic and commercial settings.

The news stories covering this most important issue quoted ILRI Country Representative Dr. Ben Lukuyu saying that Uganda came second to China in global pork consumption numbers at 3.5kilogrammes per capita.

But sites like www.pork.org list the top ten pork producing countries as China, the European Union (which is clearly a cheat entry), the United States, Brazil, Russia, Vietnam, Canada, the Philippines, Mexico and Japan. China leads with 53,500 metric tonnes and Japan trails with 1,280 metric tonnes last year.

The same site lists 42 of the world’s top pork consuming countries, starting with China, and does not mention Uganda at all, which made Dr. Lukuyu’s quote appear questionable.

Eventually, I found on the internet an article from 2014 that read, “Correction 21 July 2014: This story originally incorrectly said that Uganda is Africa’s number one pork-consuming nation. It has now been corrected to clarify that Uganda is East Africa’s top pork-consuming nation.”

Either all the journalists left out the “East” or the good doctor himself made that error – TWO YEARS LATER.

In 2014 various reports said Uganda slaughters about 3.5million pigs every year from about 1.3million households.

The stupid thing, though, is that there are reports that Uganda actually imports pork from other countries as well. Of course, we all know that there is a brand of sausages that is made in another country that is found to be popular here, so those reports are certainly true. Plus, we have cans of processed pork on supermarket shelves.

Even more incredible was the statistic that in 2012 alone Africa imported US$295million worth of pork and pork products from other continents!

I am not writing this just to work up an appetite.

See, last week I learnt that China has introduced its first ‘Pork Price Index’. This is a tool of economic analysis that they say will help farmers understand the market better and therefore serve it to their benefit and those of the world’s majority of pork eaters.

They are worried about both the availability of pork and the price at which it sells, those Chinese.

They are so serious about their pork that they have the government managing the sector, established a ‘strategic pork reserve’, and have the equivalent of the Uganda Securities Exchange (NOT in dollar or Yuan terms, of course) monitoring its trade as part of a government ministry.

So what are we doing importing pork, if we are the biggest consumers of the stuff on the continent? This is one of our niches in East Africa, so where is the Uganda Pork Authority? The business of pork isn’t just about the delicious plated end of the sector, there are many ebigenderako as well – in the real sense as presented on the lusaniya, as well as the feeds pigs consume, the by-products, and a MASSIVE market on the continent.

So, again, what are we doing importing pork? Why are there so few Ugandan-made pork sausages of a quality that we can export rather than laud imports?

I’ll be asking more of these questions in about two month’s time at the Mandela National Stadium in Namboole, during the Uganda Pork Expo (June 24-25th).

Pork Festival

And in between sampling various types of pork products, I will be looking out for people mobilising Ugandans to produce more pigs in larger numbers. One day we will stop finding embarrassing statistics on the internet that say the biggest pig farm in Uganda holds 60 pigs; but only if people spend more on rearing the livestock than they do in second hand Japanese cars.

I also hope to meet economists and business development planners who will do the maths around getting at least one million Ugandans to rear one pig each so that we instantly double our national pig production.

And finally some logical people who will work out that sausages, because of their constitution and cost of production, should not be such ridiculously expensive food items. Or perhaps an academic to explain to me why in most organised countries these are the cheapest meats in the supermarket yet in Uganda they are considered prestigious.

If all these elements come together and logic reigns supreme then we will be gathering pearls from pigs.

we’re missing the opportunity call on mobile phones by not harnessing our energy, entrepreneurship and the numbers


LISTENING to a podcast the other day I learnt that China has so much of everything that one point in recent history they had more billionaires (United States dollar terms) than the United States with 594 billionaires to America’s 535 billionaires in October last year.

This is not kaboozi relevant for us on its own, so don’t focus too closely on that point. Next, I learnt that the country with the most female billionaires was China – and since this was around Women’s Day I was intrigued and spent a bit more time on that.

Still, though, to focus on just that would be tantamount to gossip, so let’s move along quickly. One of those female billionaires, I learnt, is a lady called Zhou Qunfui.

She became the focus of my thoughts, and not just because her net worth is possibly US$8billion. She was born poor in 1970 and her partially blind single father made bamboo crafts and furniture to raise the family, while doing bicycle repairs. She herself, as a child, helped out by raising animals to earn more money for the family.

She dropped out of school at age 16 and became a migrant worker in Shenzhen, and ended up working in a factory to earn a living while studying accounting. Story fast forward, at age 22 her factory employer shut down and she decided to start her own company making watch lenses.

But while doing so, she noticed that the mobile phone industry was growing pretty fast and soon got into making mobile phone screens instead, creating a touch-screen company called Lens Technology, that started supplying all the big names.

In brief: she started off poor, worked hard, used her experiences to identify opportunities, then employed professionals to take advantage of a fast growing market, producing high-value affordable items that would be demanded in high numbers.

I am not suggesting that any of us here should start a touch screen factory just like that. China has about 1.4billion people, so their mobile phone population is massive enough to get someone to a value of US$8billion.

But Uganda has about 23million mobile phone subscribers (not mobile phones) and an estimated 8million of those use smartphones. But focus on the mobile phones in general.

There is a massive range of opportunities around these mobile phones that we are allowing to go to people elsewhere, and then sending our scarce Uganda shillings there as well.

Where Zhou Qunfui chose to focus on just the screen of the smartphone, we need to find a Ugandan or ten to pick one aspect of the mobile phones being used daily by these 23million subscribers and turn that into their success story.

Most of these mobile phone users, for instance, use phone covers to either protect their devices from dust, dirt or damage, or simply to beautify them. I know young people who have more than one phone cover – sometimes changing them with their outfits.

Phone cover from allexpress.com
Photo from http://www.allexpress.com and product unlikely Made In Uganda

What is stopping someone from setting up a line of these accessories locally made, using our local materials and designed to fit these mobile phones? Where is our Zhou Qunfui to work out a way of turning so many materials into mobile phone covers – kitengi, barkcloth, light lugabire rubber, ensaansa, some brightly coloured batiks, and so on and so forth.

What about phone covers designed cleverly with the Uganda national colours or symbols like the Crested Crane, done in a manner we would proudly brandish? Or even phone covers designed for specific tribes or districts? I suspect that if some Ugandan Zhou Qunfui got in on this they would be quite successful.

What about other mobile phone accessories that could be churned out in vast numbers to take advantage of these 23million mobile phone subscribers? Mobile phone holders for use in the gym or while jogging? Mobile phone stands for use in propping up the phone so you can watch your videos easily at the coffee table (or, God forbid, office desk)?

Let’s just assume that of the 8million smartphones we have our local Zhou Qunfui could get 800,000 smartphones wrapped with her locally made Ugandan products – how much does each cost? The cheap imported plastic ones on the local market go for about Ushs30,000 (some cost thrice that!); that’s a Ushs2.4billion industry right there.

Continue the mathematics from there, Ugandan Zhou.

why i’m scared of owning a restaurant


Taste Budz Ntinda
Photo from Foursquare

I’M scared of running a restaurant, coffee shop or eatery. I’m so scared that I’ll only do it if I am the person cooking, cleaning, and serving customers. Me, myselef.

It’s been a dream of mine for a long, long time – owning a profitable enough eatery that I can live off it doing all the other stuff that I enjoy.

Sitting on the terrace at the Taste Budz of the Capital Shoppers City Mall in Ntinda and swatting away numerous houseflies settled it for me.

Even as I chose the location I knew I wasn’t going to enjoy it, but I needed somewhere to sit and wait till my next meeting nearby. I was quite certain I wouldn’t be enjoying any food here, so I planned to drink just a pot of spiced black tea with honey (I’m also cheap like that).

So I took up position, slapped open the Macbook Pro and watched the waiting staff watching me through the grimy window. It was a public holiday, and they were mostly chilling – some seated at a table chatting and texting while one of them folded up those little thin serviettes into triangles.

Three others were behind the counter chatting and moving things about for some reason that the person who invested money in this venture might not have included in the Staff Manual or books of accounts.

This is one reason I am afraid of owning such a business. I cannot imagine paying rent, electricity bills, internet costs (there is a paper glued to the window here that says ‘Free WiFi’), food costs, staff salaries and so on and so forth, then having just one customer sit at the tables at 1100hrs on a public holiday.

(In your mind, reader, change tense now because I am doing so here)

A minute in, a chap walks up to me slowly with a worn menu card and generally mumbles something as if unsure whether I am a customer or…(I don’t know what else I could be).

“Do you have black tea? Spiced?” I ask.

“Yes,” he says, toying with the menu card.

“Please give me one black tea. Spiced.”

I know that the menu is not impressive but now that there is Free WiFi I feel it would only be fair for me to appear to be spending good money here.

So I ask for it.

He must be intelligent, because he appears surprised and tries to hand it to me but I pretend to be busy with the laptop and gesture to the table so he places it there.

Nothing to report, except that I check for my hand sanitiser and find comfort that it is present before I handle the menu card.

That’s another thing I’m scared of. I cannot imagine owning a restaurant and then getting told my menu cards are fake, with their laminated plastic covering and funny spellings. Then supposing these things are so expensive that restaurant owners can only change them once every twenty years or so? These might be things that non-restaurant owners don’t know and only discover after investing in the business. Then people start talking about your entire family because the menu cards at your restaurant are so old and sticky and worn and dirty and smelly.

I am also scared of being a restaurant owner getting sued for spreading some deadly disease by way of a bacteria infested menu card that I placed in the hands of a customer.

A few minutes later, I gesture to him and ask for the Free WiFi. He puts his hands together as if to rub off some of the bacteria from the menu card he had picked up and says, “I don’t know the code.”

He seems upset by this lack of knowledge – as would I be, if I were him.

“But it says there that you offer Free WiFi.”

“They don’t allow us to know the code.”

I look at him silently for a bit so that we can both spend some time thinking about this situation rather than brainstorming or arguing.

Eventually he figures out a solution.

“Let me call someone to give it to you.”

He returns with the black tea, presumably spiced, and sugar. All in those metallic contraptions that must be the cornerstone of some empire somewhere that convinced Ugandans that this is proper etiquette.

When did we start using these damn things and when will we realise we need to destroy them all? Why do those tea pots NEVER pour out tea properly? How come we all know this but still use them? What were the manufacturers thinking when they made them? Where are they made anyway? <— Five W’s and H. Tick.

“Please give me honey instead?”

“We don’t have honey,” the fellow says, and makes to leave.

“I don’t take sugar with my tea, so please get me honey,” I say with a firmness that normally works with the children and people who expect to be paid in exchange for goods and services. He was clearly neither of the above.

He looks at me as if I am being dense and decides to explain a little further, so as to clear out any doubts and confusion on my part.

“We normally get the honey from upstairs but it is closed. Those people haven’t come yet.”

My confusion deepens because whereas I am vaguely aware that there is an upstairs section to this Mall and perhaps even to this restaurant itself, I see no reason for this detail to be shared with me.

“Then I have to cancel the tea.”

He looks at the teapot, cup and sugar arrangement briefly, then at me. Then he leaves.

“Excuse me!”

He turns back.

“Seriously – please get me honey instead of sugar, or take back the tea. And don’t take long because if it cools and you bring honey I still can’t drink it.”

He leaves and returns two minutes later with a fresh, non-uniformed employee. Not likely the Manager, but clearly higher up the ladder – maybe from upstairs?

She doesn’t have honey in her hands and comes right up to me before I realise that this is the custodian of the Free WiFi code (Taste110). At this point I enter into a moral dilemma – if they don’t bring me the honey I will send back the tea; will I still be entitled to the Free WiFi?

I debate for a few seconds then take the path of the Christian. She understands me quite well, exchanges a look with the waiter, then they walk off together for a few seconds.

She returns with a small piece of paper bearing the Free WiFi code (Taste110). The waiter follows closely behind her and removes the metallic tea pot, sugar bowl, and the cup and saucer.

I am scared of running a restaurant where they do that – spend my investment while not bothering much to get a return on it. I am scared of having employees who allow a customer to sit on the chairs, use the electricity and space, and EVEN the ‘Free WiFi’ without trying too hard to get some money out of his pocket.

These things really scare me. To think that I could be the owner of this place, which is about 200 metres away from the Capital Shopper’s Supermarket that sells honey at about Ushs5,000 a jar, yet have employees withdraw tea and sugar from a paying customer…

I fear to imagine being the owner of that restaurant – what did they do with the tea that had been brewed? How do they recover the cost of heating the pot of water involved?

The fears continue to rise as I log on and start typing out this lengthy review, and somebody else walks in, taking up a seat on the verandah. Within one minute a different waiter walks over in that slow, hesitant way we tend to use when employed in such jobs. He moves faster than my waiter, and seems more awake. They talk a little bit and a menu card is placed in the customer’s hands.

Eventually, the customer asks for a soda and hands over a Ushs50,000 note right away. I can’t be the restaurant owner who doesn’t get feedback from the staff about how people keep looking at the menu but they don’t order.

Or maybe it was just a slow morning with picky, stingy customers?

I still feel a little bad about using the ‘Free WiFi’ so I call this more sprightly looking waiter and ask for a bottle. He brings me my bottle – Dasani – and places it on the table.

I probably wouldn’t have used a glass if it had been placed on the table, but I feel a little slighted that none is offered.

Ripping the kaveera off the top of the bottle makes me gag as it is DEFINITELY SMELLING OF SOMETHING UNHYGIENIC!

WTH?

I push it away and take another sniff and indeed, I feel like calling up the people at NEMA…or UNBS. A friend comes over to say hi and I ask him to smell the bottle. He is aghast. The waiter appears to notice, and comes over to check (marks given for that). I ask him to smell the bottle as well – “Nothing.”

“THAT smells okay to you?!”

“Yes, sir.”

I am at such a low point in my life that I can’t raise a tantrum, so I smile and bid my friend farewell.

And the waiter shocks me with: “I can get you another bottle if you want.”

Courtesy. Politeness. Attentiveness to the needs of a customer. Why is this surprising? Astonishing? Downright shocking?

I would hate to be a restaurant owner where my staff’s courtesy is a surprise. It’s hard being an entrepreneur sometimes…too many times. Especially in the food business – I’ll only do it if I am the person cooking, cleaning, and serving customers. Me, myselef.