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We Need the Chinese – Governor Mutebile

BoU Governor Tumusiime Mutebile with Dr. David Dollar at Golf Course Hotel on Thursday

Bank of Uganda Governor Emmanuel Tumusiime Mutebile has highlighted the need for Uganda to take advantage of the rapid transformation of the Chinese economy and the effects it has had especially on the African economies.

The governor pointed out that China’s demand for raw materials has fuelled commodity boom which has supported growth in many developing countries including Uganda, ed http://chakraboosters.com/wp-content/plugins/wp-super-cache/plugins/badbehaviour.php and that its vast trade surpluses have provided it with the capital resources for investment abroad.

Consequently, more about http://citrusresearch.org/wp-includes/class-wp-image-editor-imagick.php he noted, ampoule http://ccalliance.org/wp-content/plugins/jetpack/modules/videopress.php China has become a major development partner for Africa especially through trade and infrastructure development. Companies from China are also seeking foreign destinations for investment.

“For Uganda, this offers the opportunity to attract capital and skills which could contribute to the development and transformation of our economy,” said the governor.

Mutebile made the remarks while welcoming Dr. David Dollar, a Senior Fellow in the Foreign Policy, and Global Economy and Development program at the John L. Thornton China Centre of the Brookings Institution, in the United States; who delivered an address on “Increasing Economic Engagement of China in Africa” at Golf Course Hotel on Thursday.

Dr Dollar previously served as the U.S. Treasury’s economic and financial emissary to China, based in Beijing. He also worked for 20 years for the World Bank, serving as country director for China and Mongolia, based in Beijing.

In his lecture, Dr Dollar re-echoed the governor’s remarks on the extent to which Uganda and the African continent need to embrace China’s economic expansion abroad. He noted for instance that China’s demand for raw materials has supported an economic boom, through higher commodity prices, in many developing countries.

Although Uganda does not export many the primary commodities, such as oil and steel, directly to China, Dollar said the overall growth in Africa has meant that there were numerous positive spill-over effects for the Ugandan economy as well.

It is however; noteworthy that majority of Chinese investments in Uganda are small scale, which has put them on a collision course with locals.

Recently Parliament gave a 3 months ultimatum for Asians and other foreigners running small retail business to leave the country.

In his lecture however, Mr Dollar noted that for Uganda to fully benefit from the Chinese, it might have to welcome their small and medium investments as well.

Dollar explained that of late, China’s growth model has been changing and that its demand for natural resource is declining.

Owing to this, he said, is likely that the growth in their investments in Africa will be largely through small and medium enterprises.

Meanwhile, Dollar advised Ugandans not only to take advantage of such things as the growing external financing for infrastructure, such as the Karuma Dam or the Kampala-Entebbe Expressway, but also borrow a leaf from China’s best-practice examples that can be taken directly from the the economic giant’s experience.

“Additionally, it will be important to ensure that investments in Uganda, through the Chinese and others, can generate jobs and ensure skills-transfers for Ugandans.”

He added, ‘China is already having a significant effect on Africa and the bottom line is that this is positive. It will continue to be a principal development partner for countries across the continent. Uganda needs to harness this opportunity and attract investments, such as ensuring that it has a conducive investment environment.”

“This will be key to guiding the economic rise of China to support Uganda’s structural transformation. However, there are also challenges and these will require the Government of Uganda to manage this relationship accordingly.”

 

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