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Tumusiime-Mutebile faces uncertain future

Not many government technocrats have an ego like Emmanuel Tumusiime-Mutebile’s.

Ask the traders who besieged him early this year, imploring him to reduce the Central Bank Rate (CBR) such that the commercial banks from which they had taken loans would also lower their interest rates.
Mutebile’s response: “Go to the banks that charge lower rates” was not the kind one would expect from the Governor of Bank of Uganda.

It certainly was not one his predecessor, the late Charles Nyonyintono Kikonyogo, would have uttered.
During his reign, Kikonyogo was civil in his approach, but firm when it came to decision-making. In fact, in his retirement, Kikinyogo contemplated venturing into making pancakes on a wide scale, a business some would say is a preserve for petty traders.

Now, questions abound over Mutebile’s future after a report by Parliament’s Public Accounts Committee (PAC) recommended that he be sacked for his role in the botched compensation of businessman Hassan Basajjabalaba. When he appeared before PAC last year, the governor declined to answer some questions despite MPs threatening him with arrest.

Can Museveni sack him?

The question now is; will Mutebile’s arrogance cost him dear? Will President Museveni yield to Parliament’s pressure and relieve Uganda’s longest-serving central bank boss of his job? Perhaps Museveni has to first pause and study the situation. See, Mutebile’s name is stamped allover Uganda’s laudable economic growth (at some point averaging 6% per annum between 2001 and 2008) stretching back to the early 1990s.

He has been pulling the country’s economic strings from the days of Obote II (when he was Chief Economist), through Sulaiman Kiggundu and Kikonyogo’s reigns at the central bank till today. As Secretary to the Treasury from 1992 to 2001, working with the International Monetary Fund, he was the point man in designing and implementing the Structural Adjustment Programmes (SAPs) that were aimed at improving the country’s economic performance.

As head of the central bank, his adherence to a tight monetary policy ensured that the inflation rate did not go into double digits until last year. Even when many African economies buckled under the global financial crisis, which stretched from 2008 to 2009, Uganda’s kept steady, thanks partly to the interventions masterminded by Mutebile.

Using a number of tools, the central bank, under his stewardship, has enabled the Ugandan shilling to stay afloat in the volatile global currency market. So, sacking someone of such accomplishments could in the short term destabilise the economy.

It could turn away some foreign investors on grounds that a new governor could pursue an unfavorable fiscal policy. In fact, the shilling depreciated against the dollar amidst rumours last year that Mutebile had quit. Yet, irrespective of his successes, some people would want to see the back of Mutebile — not least because his actions led to the loss of taxpayers’ money.

While Parliament cannot remove Mutebile, it can exert pressure on Museveni to sack him. It can decline to approve BoU’s expenditure, like the 8th Parliament did to the Inspectorate of Government when Faith Mwondha, the former Inspector General of Government, refused to appear before it. In the end, Museveni relieved Mwondha of her duties.

On the surface, Uganda is not short of people who can replace Mutebile. There is Dr Louis Kasekende, the deputy governor, who has also worked with African Development Bank as Chief Economist, or Prof Ddumba Ssentamu, a former board member of BoU, who now heads Makerere University’s College of Business and Management Science (COBAMS).

Such individuals have impressive resumes, but replacing Mutebile will take much more than the requisite academic credentials. It will require someone with the spine to act –– even when his/her actions might seem unpopular –– as well as an individual who can correctly read the economic situation, so as to prescribe the right intervention.

Who is Mutebile?

In some ways Mutebile, 63, was an accidental economist. As a youth, and being an admirer of Uganda’s former president, Dr Apollo Milton Obote, politics was his passion. In 1971, he contested for the guild presidency at Makerere University and won, defeating people like Elly Karuhanga, the prominent lawyer who is also a former MP for Nyabushozi.

As a student leader, Mutebile was critical of Idi Amin’s government, especially its handling of the economy. In 1972, midway through his course, Mutebile fled the country after state agents tried to arrest him. This followed a speech in which he had blasted Amin for expelling Asians.

This horrifying experience appears to have changed his career trajectory, because when he went to the UK, he made up his mind to quit politics and concentrate on economics. There, he completed his bachelor’s and master’s degrees in Economics, including at Oxford University, before returning to work in various capacities.

Mutebile has had few public spats with Museveni, the most notable one being last year when he told the Financial Times that the President’s tinkering with the foreign reserves to purchase fighter jets had sent shock waves through the economy. This didn’t stop Museveni from renewing the governor’s contract till January 1, 2016.

While taking over the reins from Kikonyogo on March 2, 2001, Mutebile acknowledged, in a speech, that a good bureaucrat should be able to acknowledge his/her mistakes and act accordingly.

“It is said that the perfect bureaucrat is the one who manages to make no decisions but escapes all responsibility,” Mutebile told the BoU staff at the time. “I do not want to see perfect bureaucrats in the bank.”

Eleven years later, as he tries to disentangle from a precarious situation, these words could still hold some meaning.

ekiggundu@observer.ug

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