By Joseph Were
Nov 10, 2003
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Gavin Seth, a presenter of an entertainment programme on local television likes to pounce on people on our city streets with funny questions. "How would you spend Shs 100 million in 24 hours?" That is what he went around asking recently. I thought the ones who told him that was a stupid question were the smart ones. I do not think that any more. In fact, I now want him to go around asking people what they would do if, from nowhere, the government ordered the Uganda Development Bank to give them $3.6 million (about Shs 7.2 billion)? My hope is that they might have better things to do with it than what one Mr Viluppillai Kananathan is doing with this amount, which was handed to him on a textile platter by our government. Kananathan is the proud managing director of Apparels Tri-star without investing a penny. We are told Kananathan was given this money on the assumption that he would sew shirts, dresses, pants, and panties for Americans to buy from Uganda under the African Growth and Opportunities Act (Agoa). Parliament heard recently that Kananathan was to have got $ 2.5m (about Shs 5 billion). Kananathan broaches no questions from either mere Members of Parliament or impetuous journalists on why he got more and says he was begged by the President to help take this money. What is known, however, is that although Uganda qualified for the "wearing apparel" provision that allowed it to export duty free to America on October 22, 2001, it had by year-end 2002 not exported any goods. It is also known that it had only exported $ 989,000 worth of goods by October this year. Add this to the fact that Uganda's exports have plummeted from a high of $ 38m in 1997 to a paltry $5m over the same period and you get a clearer picture showing why I am convinced that Kananathan is not interested in exporting pants and panties. If Kananathan were interested in Agoa he would certainly have heard of the Swaziland experience. When Swaziland first got Agoa, it invited Taiwanese garment manufacturers who almost wrecked the deal by not paying their workers overtime, locking them inside factories to meet shipping deadlines and working them without breaks. The Agoa factories in Swaziland were quickly gaining a reputation as sweatshops in which workers were allowed only two five-minute toilet breaks a day. Most did their toilet in kaveera (polythene bags) until their government stepped in to halt the mistreatment. Now consider this: By 2001 Swaziland's Agoa exports were valued at $ 14 million, today they reap $ 124 million. There is money in Agoa. Countries like Lesotho have got $ 357 million so far, $ 280 million for Mauritius, $ 254 million for South Africa, and $ 180 million for Kenya, and $ 119 million for Madagascar. These are the big players. But Uganda could at least play in the minor league where the poorest player, Cape Verde, has bagged a cool $ 2 million. But, by mistreating workers, Kananathan is not going to get it. In fact, American consumers could boycott his products. Also, Agoa has very stringent Rules of Origin. By Sept. 30, 2004, Uganda should be using either local material or those from the US if it is to continue exporting as a "lesser developed country" under Agoa. Kananathan, his friend Kumar Dewapura, and other owners of Tri-Star (we do not know them because the file of the owners has grown wings and disappeared from the Registrar of Companies office and led to speculation that either the President or someone close to him, owns Tri-Star) - they could learn from Swaziland. May be I am being na�ve. At least that is what my journalist colleague said to me the other day. "Tri-Star is no ordinary company," she said. Of course. Its head, Kananathan, sprung to fame when he was charged with impersonating an ambassador, and it is under Mr Sam Kutesa (minister of State for Finance in charge of Investment, who gained fame when he was censured by Parliament for abuse of office) and Mrs Susan Muhwezi (Presidential Adviser on Agoa, who is very close to President Yoweri Museveni's family and whose husband, again a minister today, was censured by Parliament on allegations of corruption). Tri-Star also had the distinction to have had none other than the President himself personally oversee the recruitment of its 1,000 mainly female staff. He directed that they be above 18, single, and in good health and with a minimum qualification of O-level. When they went on strike, he pronounced them lazy. Many were fired. Museveni is an employer and employers in Uganda treat their workers badly. That is official. A report by the Inspector General of Government for 2002 says the highest number of complaints (about 20%) lodged with it concern employers who refuse to pay workers. In the latest incident, workers at Ngege, a fish processing plant in Kampala run by so-called Foreign Investors went on strike when the company changed their terms of service. Aiming to save a few pennies, Ngege downgraded its workers from staff to casual labourers. The more poignant point is the panache with which government officials have gone on a blabbering spree since the President, Lt Gen. Yoweri Museveni spoke out in support of the Tri-Star management style. Of course Museveni is a management guru. Haven't we all seen how he has bought high technology equipment for the army and the wonders it has done and continues to do against the Joseph Kony rebels? Still, if the Tri-Star managers are so smart, why do they rely on state patronage? Good managers motivate workers. Good managers avoid strikes. Good managers avoid high staff turnovers. They minimise costs of production, especially obvious ones like those that result from training new workers when others are fired. This is basic. I do not know whether Tri-Star is making or will make money in future, either for the owners (whoever they are), or the government, which is pinning a lot of hope on them. I also know that the unemployed masses of our people will continue to queue for jobs at Tri-Star. I also know that many do not like the way taxpayers' money is being pumped down an apparent black hole. Obviously, this black hole has a collecting bag somewhere. One day we will know who is holding the bag. Mr Were is Training and Multimedia editor of The Monitor. |
� 2003 The Monitor Publications
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