In Summary

New series. This month marks 33 years since Milton Obote was overthrown by his army commanders for the second time. In the first of our four-part series on Obote’s journey out of power, we examine how the poor state of the economy led the UPC leader in trouble.

On December 15, 1980, Milton Obote was sworn-in as the president of Uganda. This was after his party, the Uganda Peoples Congress (UPC), won the December 10, 1980, general election.

On December 19, 1980, Obote went ahead to appoint a Cabinet and made himself minister of Finance, a position he held until July 1985 when he was ousted for the second time by and his army. He was first ousted in January 1971 by Idi Amin.
Aware that he had inherited a run-down economy, Obote hired experts from the International Monetary Fund (IMF) and World Bank to help to revamp the ailing economy. Loans were secured from the IMF, World Bank as well as some Western countries.

In 1982, the Economic Recovery Programme was rolled out. Although huge loans had been injected into the country, the economy kept on bleeding until the regime was toppled by the army.
But despite the hard economic times, president Obote and his UPC cronies enjoyed a lavish life.

Ailing economy
In February 1984, The Economist, a UK weekly magazine, published a story about Uganda’s ailing economy and endemic corruption.
“It is foolish to put money in Uganda and expect it to stay there,” read the story in part.
While a lot of borrowed money was on one hand being spent on the military, especially to purchase equipment to fight the National Resistance Army (NRA) war in Luweero, on the other hand UPC stalwarts in government plundered the economy.

In late May 1985 there were press reports of Uganda Commercial Bank running short of cash, and as a result its cheques to Bank of Uganda had bounced.

On June 12, 1985, the bank’s chairman and managing director, Richard Kaijuka, called for a press conference at the bank’s headquarters in Kampala.
“Uganda’s economy has virtually collapsed. The highest salary in Uganda is between $150 and $200 a month,” he said, adding that, “for many Ugandans monthly salary is spent within the first two weeks while for thousands of others it is spent within a couple of days.”

Push for change
With such frustration, some members of the public hated the government and turned to the NRA rebels for hope.
One such example can be drawn from a letter to the Munnansi English version written by Chris Bitature of Kampala published on June 17, 1985.
“The recent bomb blasts at Crested Towers, in Kampala Chief Magistrate’s Court and at the Indian High Commission building in Kampala, speak of the prevailing insecurity, a sign of discontent of indigenous Ugandans against Obote’s mismanagement of Uganda’s affairs,” read the letter in part.

Many Ugandans believed that if it were not for the Asians, Obote’s government would have collapsed immediately. Many of the UPC stalwarts were in business with the Asians.

Huge sums of money were spent on luxuries which the Treasury often disguised as classified expenditure either on military or State House.
The Opposition in Parliament led by Democratic Party leader Paul Ssemogerere was too weak to cause any investigations into such affairs.

Heroes’ day expenditure
One of the occasions on which the UPC government wasted national resources was May 27, always celebrated in Bushenyi District.
Since May 27, 1980, when Obote returned from exile in Tanzania and was hosted to a welcome party in Bushenyi, the party held an anniversary celebration every year.

The annual Bushenyi function became an extravagant affair where millions of shillings would be put to waste.

To put that in context, in December 1980 government spent Shs100 million in organising the December 10, 1980, general election. But the following year, Obote’s government spent more than a quarter of that in hosting the UPC party function.

On May 27, 1981, president Obote who was also minister of Finance, released Shs30 million to be used for the preparation of the heroes day in Bushenyi. The following year, the money more than doubled; Shs62 million was used for the same function.

In the third year, Shs121 million was used while on May 27, 1984, a whopping Shs400 million was used to commemorate the day in Bushenyi.
However, the day was not celebrated in 1985 because there were glaring signs that the UPC regime was sitting on a time bomb.

Fleet of presidential convoy
For four years, whenever Obote went up-country, he travelled in a convoy of between 20 and 40 Mercedes-Benz and Land Rovers cars.

In fact, Obote had since the 1980 campaigns been under criticism from his opponents Paulo Ssemogerere, Mayanja-Nkangi and Yoweri Museveni.
Presidential candidate Museveni while in Rukungiri District in 1980 wondered why Obote was escorted by a fleet of military cars as if he was going to war.

And whenever president Obote travelled inside Uganda, he was accompanied by all his Cabinet ministers, permanent secretaries among other senior government officials. And to add on that, hundreds of UPC youth from all over the country also accompanied the president. And each would be paid a travel allowance.
And when the president or his senior government officials fell sick, rarely would they seek treatment from Uganda. They were always flown to Italy, France and India for treatment.

By January 1986, only six months after the toppling of the Obote II government, Uganda’s economy was ranked 12th poorest in the world. The external debt was at Shs1.2 billion.
Also interesting to note was that at the fall of the UPC regime in July 1985, inflation was shooting to the highest since 1979. A bottle of beer was selling at Shs10,000 which was equivalent to an annual contribution of a National Social Security Fund member.

On June 9, 1985, DP leader Ssemogerere addressed a gathering of Ugandans in London.
He was quoted by several UK newspapers as saying: “The international community will continue to suffer, shouldering the burden of looking after the growing number of Uganda refugees as well as Uganda’s massive debts.”