On 26th and on 27th October 2018, Makerere University hosted the Geopolitics Conference. Codenamed “Kampala Geopolitics Conference 2018”, the convention had 21 panel discussions.

According to a communiqué issued prior by the conveners, the Geopolitics Conference is inspired by the Geopolitics of Nantes (France), often involving discussions on politics, diplomacy, environment and society.

On the closing day, two Research Fellows from the Economic Policy Research Centre (EPRC) separately partook in two panel sessions offering discourse on matters neocolonialism and Capitalism alongside several other experts.

Paul Corti Lakuma joined Ezra Suruma, a Senior Economist and Chancellor Makerere University, Ramathan Ggoobi, a Lecturer at Makerere University Business School among others to discuss the side effects of unbridled capitalism and whether money is ruling the world.

Lakuma said countries should be careful not to stifle the good effects of capitalism. “Capitalism is not wholly bad, it is responsible for flow of finances, diffusion of innovations and growth which is important in reducing income inequality,” he said.

Kampala 2018 Geopolitics Conference Paul Oct 27 2018

He called for taxation for firms and individuals who reap big from capitalism arguing that corporate tax policies tend to be so generous. The basic rate of corporate income tax in Uganda is 30 percent. Lakuma said that considering the deductions for dividends, the deductions for interest payment, debts among others, most companies, some of whom have indefinite tax holidays end up paying 3 percent of their turn over.

This he said attracts predatory investments. “We should design taxes that promote business growth and spur income distribution,” he reasoned.

In Uganda, one is required to have 100,000-dollar investment in order to enjoy tax exemption. Due to general biting poverty, many ordinary Ugandans cannot enjoy such incentives.

Lakuma observes that many people don’t even know about opportunities such as those provided by Uganda Securities Exchange, where one can raise venture capital using equity financing. Additionally, Free Zones favor those who produce for export however, very few Ugandans can produce for exports.

Professor Ezra Suruma, was asked to tell whether curtailing the effects of capitalism in a globalized world is a big challenge for many countries.

He said that most people are subsistence producers and money does not dominate their lives but rather dominates their thoughts. Subsistence producers he said are probably more worried about their gardens and school fees.

Suruma said that those who have money have influence and that government, which controls the masses, relies on people who have access to money to organize politics, which has large impact on people.

He doggedly said that the poor can change the world but in a hard way. “Fighting money and power (capitalism) is hard work, dangerous work,” he said. Adding that “Things can change but then there those who come in and start accumulating money and they don’t want to go out.”

He called for equitable growth, where subsistence farmers are enabled to have higher productivity of whatever they grow and this could translate into higher income.

Suruma cited the Henan Province, which he said, has a GDP of 600 million dollars and a population of 70 million people. Much as Uganda has about 40 million people, Suruma says there is need to increase the GDP by improving on the household incomes as a way of solving indigenous problems, which are not being created by capitalism but by low productivity, low technology and relatively poor economic organization, which needs to be improved.

Ronald Mukasa, a Business Development Manager at Enterprise Uganda called for a need to create capitalists who have the heart for the people by creating jobs and also enjoy the benefits of their profits.

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During this panel, Madina Guloba, a Research Fellow at EPRC joined other experts like Andrew Elias State, the Dean School of Social Sciences, Makerere University to among others understand whether African countries are free to drive their own economic development agenda and what makes China’s declared unconditional support so attractive.

Guloba hinted that the West is scared about being displaced by the new game changer- China, and that many Ugandans have welcomed the Chinese.

She argued that Chinese investments especially in roads have exhibited value for money. She added that no one should chastise the technological transfer resulting from Uganda-China relations and expressed worry on readiness by Ugandans to adopt and use such technologies.

Madina argued that the policy shift in most African states is slower than emerging opportunities. Citing the African Growth and Opportunity Act, which enhances market access to the US for qualifying Sub-Saharan African (SSA) countries, Madina said that leaders were not doing enough in tapping emerging global opportunities.

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Hashim Wasswa Mulangwa, the Director Adam Smith International said that quite often-foreign companies are given incentives to come and invest in developing countries with expectations of good returns.

However, realizing such returns may be a different story since foreign investments are marred with hidden interests.

Mulangwa says somehow, African Countries have ceded control of their economies. He also argued that the West is losing out since the economic power is shifting to the East, something that can be a benefit to Africa. He said that Sub Saharan Africa is  today growing faster than before with East Africa lately attracting 11 billion dollars in foreign direct investments.

Has the academia addressed the issue of foreign control?

Andrew Elias State says the Academia has not yet addressed the issue of foreign investment or control warning that foreign control is a big trap.

Citing Confucius Institute whose aim is to promote Chinese language and culture, State noted that some foreign powers are investing in African countries in terms of the software and culture, where cultural institutes are being established.

At least most premier Universities such as Makerere University and University of Zambia have become hosts to the Chinese Confucius Institutes.

State says that the languages taught in such institutes are good for business but their intentions call for further scrutiny.

He questioned the states inability to provide the youth with jobs and the labour export to the Middle East. He also blamed African leaders for dealing with foreign powers as individuals and not as blocs.

 

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