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Baroness Lynda Chalker, the former UK
overseas development minister and a long time friend of Uganda,
delivered the third lecture in the Uganda Society-organised Leadership
Lecture Series at Speke Resort Munyonyo on Wednesday night. She spoke
on Uganda's Place in a Globalising World: The Role of Business. Below
is a significantly edited version of the speech:-
I am
delighted to be at "home again" in Uganda. As a businesswoman running
a commercial consultancy [Africa Matters Limited], I care deeply about
getting more investment into Africa.
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| GAVE ADVICE: Ms
Chalker |
The world
is changing, and changing fast. Competition is greater than ever
before. Gone are the days of State direction. The days of the
'commanding heights of the economy' are over. The reason for these
changes is that State economies do not produce sustainable
growth.
Today it is recognised that it is the private sector, which
is the engine of growth for Africa as well as for all our competitors
all across the world.
A
thriving domestic private sector not only holds out the best hope for
in-country investment. It is also the very best way to attract outside
foreign investment and it is the ONLY long-term sustainable way to do
so.
Attracting that foreign investment is becoming a fiercer and
fiercer competitive battle. Even as FDI to developing countries rose
in 2003, after three years of stagnation, our sub-Saharan African area
did not benefit from this upturn. The majority of FDI for Africa has
gone to oil & gas exploration and to the solid minerals sector.
Slowly more is coming to manufacturing, and the Diaspora is
re-investing in their own countries.
A key
reason is that there are other countries in the developing world,
including China, which are much better placed to take advantage of
increased FDI available than those in Africa have been to date. Those
countries make fewer demands on the investor and businessman and allow
business to get on with their jobs with the minimum of necessary
regulation.
Africa as
a whole must recognise this fact. It will not reverse or go away.
These facts cannot be sidestepped or put off. They have to be faced
head on.
How Uganda fares
Uganda
has many positives, which stand it in good stead. It is strategically
positioned within economically important and resource rich east and
central Africa, the improvement in macro-economic conditions is
commendable, the economy is becoming increasingly monetised, and is
gradually emphasising manufacturing and services including trade,
tourism and transport. Also, Uganda has one of the best education
systems in Africa.
Importantly, the current Ugandan labour force is plentiful,
fairly well educated, English speaking and ready and willing to be
trained.
But there
is a lack of middle management capacity and technical skills, such as
the need to improve skills in the Bureau of Standards. These problems
are seen as barriers by investors. And can and must be
tackled.
Overall, therefore, Uganda is well positioned to
demonstrate how successful business can boost a country's position in
the world.
Role of business
Business
can and must help government ensure that Uganda is a country in which
it is attractive to invest and straightforward to make those
investments. What does this mean?
First,
investors look for a fairly standard series of norms when judging
where to direct their investment. Uganda needs to ensure that the
country at least meets and, where possible, exceeds these
norms.
Can the private sector assist the public sector in this
exercise? Yes, in many ways.
The
private sector has the managerial capabilities, and the processes and
objectives-setting that is too often missing within the public sector,
particularly the civil service. Therefore, a system of mentoring,
personnel transfers, or partnerships to increase capacity between the
private and public sectors could do much to inculcate these processes
in the public sector and allow each to understand the motivations and
challenges of the other.
I am particularly struck by the success in
other African countries, where private sector directors have joined
the government, that the results have been much more usually
successful than not. Egypt is a real case in point.
International
companies operating today in Uganda can also help in the process of
raising and developing the private sector voice in the country.
Success
inside Uganda will be of little help to the country unless that
success is communicated externally. International companies can also
help, therefore, in the process of selling Uganda to the international
community. But they have to be honest about the product that Uganda is
seeking to sell abroad.
Business
can also do much to encourage the emergence of sound regional
groupings.
Actions
such as these � a true partnership between business and Government �
will do much to enable Uganda to develop, and to retain much needed
human resource which otherwise might be tempted to seek its future
elsewhere in the world.
Just as
some 40% of Africa's financial wealth currently lies outside this
continent, so many thousands of Africans are helping to run the
infrastructure, health services, financial services and industries of
countries other than their own. This brain drain must be slowed,
halted and reversed � but it will not happen by Government edict, only
by creating a business and growth environment, which is attractive to
those currently in the Diaspora.
Transparency and accountability
No
country in the world, and no business either, will have enduring
business and growth results that enable the leadership to lift up the
condition of the people unless there is unequivocal dedication to the
fight against corruption.
The Convention on Business
Integrity
launched by SAP in Nigeria is a beginning. In the CBi, businesses sign
up to meeting a set of rules and then government departments agree
only to source their supplies from those who are signed up to the CBi
or their own published codes of business ethics.
Those
seeking a home for investment in Africa and elsewhere will steadily
only look to countries which are publicly and transparently committed
to improving governance in both the private and public
sectors.
The fight
against corruption is often given verbal support. This means nothing
unless the actions are taken openly and publicly. Uganda still has
some considerable way to go, and it will be one of the first countries
to act fully against corruption, and that go on doing so, that will
win the greater investment that the countries so urgently need.
Looking ahead
The
private sector in Uganda is still small and fragile. The majority of
the more than 100,000 existing enterprises have been established in
the last 10 years or so. Nevertheless, Uganda remains a testament to
what can be achieved, given the right leadership and political will.
Now, it is important to continue and enlarge that commitment on the
part of government, the private sector and other institutions of civil
society.
That way
lies continued success for this country.
Thank
you
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