Thursday, September 19, 2013

Uganda’s Energy Sector Set Back by Amin Era

Starting with pre-independence times, energy was set on a good footing, with grid electricity available in the late fifties. With the ascension of Idi Amin to power, there was gross negligence of important tenets for the maintenance and growth of the energy sector. This resulted in retrogressive trends from a number of angles.

Idi Amin addressing a rally

The sixties
Having attained self-governance on October 9th 1962, Uganda was set on a good energy course, starting with good access to electricity, a modest population of 2.24 million people for the resources envelope available at the time.

At that time, the supply of electricity from Owen Falls Power was already available, meeting all needs of the day, not to mention the surplus even after export to Kenya. Many people with access to grid electricity at the time did not even imagine that electricity may be thermally generated where hydropower potential is unavailable.

The seventies to eighties
With Amin ascending to power in 1969, the seventies were characterized by a ‘gross negligence of planning and good operation and maintenance practices’. This is not to say that all that was done was void of good things entirely. We will however focus on what impinges on energy matters.

Expulsion of Asians
Starting from the pre-independence times, Asians were brought in East Africa to help the British with the construction of the railway from Mombasa Kenya through to Kasese in western Uganda to carry to the Indian Ocean the copper from Kilembe Mines en-route to England.

Expelled Asians on a train leaving Uganda

largely occupied the skilled technician level in industry in general, both in large and small industries, be they public or private.

To cut the long story short, the Asian community got deeply involved in business and manufacturing in the region.

At expulsion, industry and business were dealt a blow, bringing much of those sectors to a near-halt.

Competent Ugandans out of business and industry

As if the expulsion of Asians was not enough, many skilled Ugandans were edged out of business, many losing lives while others fled for dear lives.

To put it mildly, a cadre of Ugandans had been developed from colonial times, with much of the competence that could enable them to take over from their Asian counterparts. This was however not to be seen in that light by the regime of the day!

Amin, a man of very humble background, felt more secure with his cronies of limited exposure, whom he allocated many businesses.

Those in trade did not see value in records of business, including supplier details, did not prudently manage businesses and industry, leading to rapid decline.

Energy Implications
The impact of this regime on the energy sector in general were, amongst others, a big reduction in efficiency at the hither-then vibrant electricity sub-sector, with reduced industrial consumption for oil, yet growth in biomass consumption without due make-up efforts.

Uganda Electricity Board (UEB) suffers neglect
Starting way back in 1948, concerted efforts were put in place to exploit the hydroelectric potential of the country.

In the mid-fifties, the Nalubaale Power Station, then code-named Owen Falls Power Station (OFPS), was commissioned at Jinja. It indeed became a symbol of industrial progress, meeting both the needs of Uganda and helping out Kenya with exports.

Ugandans with access to electricity were to enjoy the modern amenities of energy then, not to mention industry which had the prospect of getting unfettered power without interruption.

In line with the saying – ‘milking a cow without feeding it’, Idi Amin’s regime was to subject UEB to neglect and paying a deaf ear to advice on the same.

These shortcomings may be summarized as:
  • Planning: neglect of this important role;
  • Maintenance: this was compromised, overlooking activities essential for sustenance in state of good repair;
  • Revenues: these were diverted to other uses;
  • Management: competence was relegated to politically motivated appointments; and,
  • Decline: by the end of the regime, a number of turbines, 4 out of 10, were out of service, beside others.

Petroleum products
The range of products and their respective quantity requirements heavily depended on the overall economic setting.

As we demonstrate later on in the blog, a vibrant manufacturing setting plays a very important role in oil product scope and needs. With many industries having frequent shutdowns or total closure, a big share of the oil industry products seized to be required.

Transport on the other hand heavily depended on petrol and diesel. Problems were experienced in supply quantities or interruptions, leading to scarcities. 

On its part, the government of the day designed schemes to ensure supply of its key operations, with the public having to queue for supplies. Filling stations would indulge in hoarding, while many drivers would follow supply trucks in the hope of being amongst the ones to be served early. 

We often had to spend hours in long queues waiting to be served, having arrived after dawn, while 14-seater public transporters and a few others that arrived before daybreak were being served.

The consumption of firewood grew unabated, given a poor setting for conversion to modern forms of energy supply and the rapidly growing population.

The absence of guidance of government on regeneration of biomass also meant that surplus capacity to sustain demand without decline of stocks was threatened.

It is indeed regrettable that there is still an overwhelming dependence on biomass use in the forms used by our ancestors.

Manufacturing declined
Having started with allocation of these enterprises to political cronies, performance suffered greatly, often ending up in total closure.

Developments in the industrial sector, on basis of know-how, may be summed up as:
  • Skills: many with technical competence were either expelled, fired, demoted, run away for dear life or killed;
  • Performance:  many facilities greatly declined in output quantities, or were unable to produce their traditional product range in full;
  • Breakdowns: many avoidable mistakes were committed, leading to shutdowns, some minor in nature, others major; 
  • Closures: these marked the climax, especially in enterprises with meticulous operational, start-up and shutdown procedures;
Other industrial sector issues related to:
  • Materials: failure to use the right inputs;
  • Suppliers: failure to link up or close deals with previous suppliers;
  • Markets: failure to access or ignorance of markets; and,
  • Credentials: failure to demonstrate integrity with potential business partners offshore, to mention but a few.
Collapse of the East African Community
The East African Community (EAC), then comprising of Kenya, Tanzania and Uganda, came to an unceremonious end in 1977, largely due to tensions arising out of Amin’s tendencies.

Its demise had a number of implications, viz:
  • Member states shared out assets, largely based on geographic location;
  • Many new organizations had to be setup for national continuity;
  • Goodwill was low, if not entirely lost in a number of instances;
  • Business climate suffered; and,
  • Operating environments became harder, especially for Uganda that is land-locked, beside others.
In respect of energy, the following can be mentioned:
  • East African Airways: this was replaced by national airlines, with varying fortunes;
  • Entebbe Airport: lost its hub status in the region to Nairobi, a situation that remains today;
  • East African Railways & Habours: its end marked the beginning of problems for the rail sub-sector in Uganda, literally still in limbo;
  • Goods transport: Uganda’s imports of goods remains heavily dependent on road transport at great cost in terms of fuel and roads, not to mention the attendant inefficiency and high fuel bills;
In conclusion
The advent of the Idi Amin era had a big dent on the energy platform for the country.

The electricity sub-sector was used as a source of revenue for other purposes, while it was left to deteriorate to very low levels of performance, threatening its very existence.

The brain-drain of both locals and expatriates resulted in long-term negative effects on manufacturing in general and industry in particular, with negative spillover effects on the energy sector.

Biomass use was denied the requisite attention for its much needed growth, not to mention putting strategies for its sustainability in place.

The EAC – then of Kenya, Tanzania and Uganda – was dealt a death-blow, negative effects of which are still being felt today.

Uganda was drawn back a number of decades in several areas, key amongst which is the energy sector.

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