An Interview With Edith G. Ssempala, Ambassador from the Republic of Uganda to the United States
Foreign aid that has fostered dependence has hurt Africa, Ambassador Ssempala says, and building the private sector has been left out of the assistance schemes. In her view, Africa must do more to integrate into the global economy. This includes efforts to empower women in Africa and to end ethnic-based conflicts.
This interview was conducted by USIA Economic Team members Barbara Durant and Phillip Kurata.
Developing the private sector is the key to bringing prosperity to Africa, says Ambassador Edith G. Ssempala of the Republic of Uganda. African countries should seek foreign investment, she says, noting that textiles, shoes, and agricultural products represent promising sectors.
Question: You have said that private sector trade and investment are the keys to conquering poverty in Africa and that foreign aid is secondary. Could you explain this position?
Ambassador Ssempala: It is not aid per se that I have a problem with. It is rather the quality of aid and the motivation for aid to Africa that I question. After the Second World War, Europe had the Marshall Plan and Japan was reconstructed with U.S. aid. That aid was basically an investment in their economies so that they could get along on their own. In the case of Africa, aid is basically motivated by sympathy and charity. The private sector has been left out in aid programs to Africa.
Aid that creates dependency is very dangerous and even harmful. Aid that empowers people to stand on their own feet is helpful and very necessary. Aid needs to be geared to help Africa gain its independence.
Q: How can aid programs be changed to make them more beneficial?
Ssempala: It is clear that only the private sector can stimulate economic growth. We would like to see a balance of helping us to take care of needs that cannot wait, like health and education, while developing our own capacity in the private sector. That same combination has worked well for other countries, such as South Korea, that have graduated from aid. That is why, right now, the members of the African diplomatic corps are very much in support of the passage of the African Growth and Opportunity Act. We believe it is a first step in the right direction.
Q: Natural resources have long been the main target for foreign investment in Africa. What other sectors are ripe for development?
Ssempala: The exploitation of natural resources, such as oil and minerals, has not really benefited Africa. It is a paradox that a country can be rich in oil or diamonds but its people live in poverty. In contrast, the people in the oil-producing countries of the Middle East are rich. There must be something wrong.
We welcome investment in agriculture, which is untapped, as well as in tourism and in service industries. We are interested in high tech. We think Africa has the potential to develop its textile industry because we think that China is going to graduate soon from textile production. Mauritius, Kenya, and Uganda are establishing strong textile sectors. In Uganda, we are creating a silk industry with mulberry bushes, which grow very well in Uganda. We are growing long staple cotton, which is the best cotton.
The shoe industry is growing in Africa. Toys will come. Those industries do not require extremely high skills, but they create numerous jobs.
Q: Foreign investment involves quite a bit of risk. What has changed about Africa to give a foreign businessman confidence to invest in the continent, given its history of instability and corruption?
Ssempala: Corruption is a deterrent to investment, but it is not the most serious problem.
Political stability is very, very important because people have to feel sure, especially if they are going to invest for the long run. Africa has come a long way. Fifteen years ago we had political instability. In Uganda, we had a vicious dictatorship, and nobody knew if we would get out of it. South Africa has thrown off apartheid; it is now democratic and has rejoined the rest of the world. Namibia has made similar progress. Yes, we still have pockets of instability, but I think Africa is going through a kind of self-cleansing.
There are two important things that have been recognized in Africa today. First, we realize that democracy is essential for political stability and economic development because it empowers the people to be creative and to participate in production. Second, economic reforms are occurring in many African countries. African leaders have realized that governments are incapable of micromanaging the economy. They understand that the private sector has to take the lead in generating growth.
There also is a widespread consensus on the fiscal policies that make for a stable economy -- keep inflation low and balance the budget. Those structural adjustments have been criticized as being harsh, but I don't think Africa has a choice.
Q: The Organization for Economic Cooperation and Development is implementing a treaty that criminalizes the payment of bribes to foreign officials. What is your view of this treaty?
Ssempala: This treaty is very, very important. It takes two to tango. It would be very difficult, if not impossible, to significantly reduce corruption unless we tackle both sides. We, in Uganda, see corruption as a cancer that must be uprooted. Services become difficult to obtain. It affects education and housing. Corruption causes people to get poor quality for their money. The fight against corruption is vital for the survival of societies.
Q: What are the most urgent reforms that African governments must make to become responsible partners with foreign investors?
Ssempala: Basically, they need to continue what already is taking place -- that is, economic and political liberalization, and consolidation of democracy and human rights. We also need to work to resolve conflicts that still exist. Uganda, for instance, has invested a lot of energy into trying to find a resolution to the conflict in Congo. We hope that the conflict between Ethiopia and Eritrea will end. We hope there will never again be genocide in Africa because that has put Africa in a very bad light. The work of consolidating peace, democracy, and justice is very, very important.
Q: The United States has less experience and knowledge of Africa than the former colonial powers, such as France and Britain. What can the United States offer Africa in terms of trade and investment that the European countries cannot?
Ssempala: We want everybody to be interested in Africa, and there is room for everybody.
The United States has contributed to the economic progress of every country. Name any country that has prospered economically, such as Germany or Japan, and now China. All have very strong economic relationships with the United States. The United States is the biggest market, and we think our economic relationship with this market is very important to accelerate our development. We also think that African-Americans can act as a bridge between Africa and the United States.
Q: Uganda is one of the founding members of the Common Market for Eastern and Southern Africa. Twenty-two countries have signed the COMESA charter aimed at harmonizing customs laws, fiscal policies, and trade regulations. How successful has COMESA been?
Ssempala: COMESA is a very important economic area. There is a commitment on the part of Africa to eventually move toward economic integration, but that is a long way off. There must be many smaller building blocks laid before then. One of the building blocks is COMESA. There are other regional groupings such as the Southern Africa Development Community, the East African Cooperation group, the Economic Community of West African States, and the Maghreb group in North Africa. The aim is to integrate the regional markets into one.
COMESA has gone a long way. It has a vibrant secretariat in Zambia. Today it is possible to move goods from East Africa down to southern Africa. The biggest challenge is to build more infrastructure. Each country is at a different level of economic reform.
We expect Uganda, Kenya, and Tanzania to become an economic community very soon. We are moving toward zero tariffs. We are beginning to promote East Africa as one investment area.
Q: Uganda has a convertible currency and a local stock market. By opening itself to capital flows, is Uganda also putting itself in danger by allowing capital to flow out as easily as it flows in?
Ssempala: I think that globalization is not a choice anymore. We just have to adapt.
In Uganda, careful consideration was given to whether we should completely open our market. The president and his government came to the conclusion that if people are not able to get out, they're not going to easily come in either. If you want them to come in, they must be able to leave easily when they want. The question is how to attract them so they don't want to leave. We must ensure good regulation and no corruption. We want to have mechanisms that provide openness, but definitely we are not interested in overexposing Uganda. Basically, we feel that no country can afford to be cut off from the global trading system.
Q: Foreign investors need skilled labor. Where are they going to find it?
Ssempala: Our universities and technical schools produce many graduates each year, and one of the biggest challenges is to find employment for them. There is a surplus of highly trained and trainable graduates who do not have jobs.
Q: Ethnic and tribal divisions are often associated with Africa's instability. How are they being addressed?
Ssempala: What is known as tribalism, or religious bigotry, is not a phenomenon natural to Africa. It is something that has been imported. I think the biggest challenge to Africa is not the tribe. The tribe is natural, but tribalism is evil and is equal to racism or selfishness. Most of the conflicts in Africa are the result of leaders exploiting tribalism, religion, and clanism. Now most Africans are rejecting this.
In Uganda today, we have the anti-sectarian law whereby a person who does good or bad does so in his own capacity, not representing anybody else, his tribe, or his religion. When a person is prosecuted, it is for his own actions, not as a member of a tribe. We think that is very important because it separates an individual and what he does from his group.
Q: Ugandan President Yoweri Museveni has emphasized the need to empower women. What effect has this had on economic development and the creation of microenterprises?
Ssempala: President Museveni has emphasized the empowerment of women because it is not just good politics, it is good economics. If you leave more than half of the population out of the market, then you reduce your market. Apart from that, women are the backbone of their families and communities. They say if you educate the woman, you educate the family and the nation.
The empowerment of women has led to the improvement of the well-being of families because when women have money, they spend it on their children.
Q: How has the empowerment of women been accomplished?
Ssempala: On the political side, we have affirmative action. We have a quota system in our parliament. We have universal suffrage. We also have quotas for women on the district and local government levels. In fact, a third of the local elected officials must be women.
On the economic front, women are being encouraged to start businesses -- microenterprises. A number of organizations are supporting the development of microenterprises run by women in particular. We see many women who have gone from making just a few hundred dollars to making thousands of dollars in just a few years. That's significant.
Economic Perspectives
USIA Electronic Journal, Vol. 4, No. 3 August 1999