Given the discovery of Oil in Uganda, it s important to note that oil has the potential to transform Uganda’s economy from the poorest to the richest economies in the world, but it also creates new risks and challenges for the country, this against the background that no country in Sub – Saharan Africa has achieved sustainable growth and stable development from oil. Oil production has the potential to plunge Uganda into abject poverty, environmental degradation, political instability and misery.
We promise to put in effective, transparent and accountable state structures and institutions to ensure that oil production translates into economic development and tangible benefits by all the people in Uganda. Where Uganda is concerned, there is need to create the best investment climate which will ensure the country to get money in, then job creation, services, boost in industrial activities hence the uplift of the standard of living of the masses.
The people of Uganda should look forward to oil improving their quality of life. They should expect increased national prosperity with commercial oil production as our Government will invest in roads, power, plants, education, health services and other social economic infrastructure. The general public should expect an end of donor dependence and conditionality hence regaining economic sovereignty. Oil will be no curse to the country as no few influentials will benefit living majority in abject poverty following a solid code of conduct to be put in place to deal with conflict of interest.
Laws in place governing Oil in Uganda will have to be reviewed and consensus arrived at in national interest. Uganda should discontinue the practice of negotiating Individual Petroleum Sharing Agreements (PSAs), but instead adopt Competitive Auctioning Process. Competitive Auctioning Process will help in striking a balance between getting responsible foreign investment into the country and ensuring that it comes on the best possible terms for the Ugandan people.
We ought to know that oil companies have one aim: to maximize their own profits. Companies do whatever they can to cut costs and decrease their tax burden. Government ought to counter this with detailed regulation, Petroleum Sharing Agreements (PSAs) and strong oversight. These companies are never willing to do things that cost them money unless you tell them to, and then, you need to look over their shoulder and as, is it what we agreed to do? It is important to emphasize the role of the Parliament of Uganda regarding the oversight on the industry. All the regulations would mean nothing unless the Government actually works to hold Oil Companies accountable, and this is Parliament responsibility.
We shall create and enforce strong specific environmental regulations for the Oil industry, more so, how to dispose off the by – products, and water made toxic when it is pumped into Oil wells.
We shall have to avoid the Dutch disease – where additional revenues from Oil will end up not putting pressure on demand for domestic goods and services in away that consequently raises the value of the local currency (real exchange rate appreciation) and makes tradable goods uncompetitive.