Makerere University on Friday 17th December 2021 held a prestigious event at which Professor Edward Bbaale delivered his Professorial Inaugural Lecture under the theme Rethinking Growth in Africa, Firms and the Business Environment Quality.
The Lecture held during the year-long celebrations to mark 100 Years of Makerere University‘s existence came five months after Prof. Bbaale’s promotion from the rank of Associate to full Professorship.
Professor Edward Bbaale has for the last decade centered his research on firms and African economies, with one part of it looking at the dynamics and economic roles of firms in bridging productivity, export and employment gaps in Africa. His other research puts into perspective the quality of business environment necessary for firms in Africa to flourish.
Prof. Bbaale said the country has great potential of technological change, innovation, employment and skilling which can only be attained when the industrial sector is prioritized.
“The contribution of industrialization to GDP was rather higher in the 60s. Due to the volatile economic environment and following what happened in the 1980s and 1990s, we have had a decline in industrialization.
Uganda in the 1990s privatized most of the public enterprises at the urging of the World Bank and the International Monetary Fund. Giving away control of key government parastatals to private individuals during the early days after Uganda had emerged from decades of political turmoil was a mistake, experts have said.
“We have seen a situation which I risk to call de-industrialization where the service sector has taken over industrial and agricultural sectors,” Prof. Bbaale said. “Despite this, majority of our population is employed in the agricultural sector yet it contributes the least. This means poverty can not be escaped unless something is done about agriculture because that is where most of our people are.”
Overall, industrial sector growth in Africa continues to lag behind GDP growth from approximately 17% in 1981 to 12% in 2020. In Uganda for example, the share of the manufacturing sector to GDP continuously experienced weaker growth with a marginal contribution of 4% in 1980 increasing to only 5% in 1990, and to 16% in 2020. This figure is still far below the 20% target specified in NDP III, Prof. Bbaale said.
“The implication of this is that although the prudent macroeconomic policies managed to increase GDP growth in Africa, they have not been sufficient enough to spur growth in the industrial sector, which affects its potential for job creation,” Prof. Bbaale added.
“What is required of African economies to revive and sustain their growth, particularly in the industry sector is to refocus on the micro-economic policy environment where business firms operate.”
Prof. Bbaale added that firms in Africa are predominantly small (close to 58%) with few medium and large firms and only 23% of the firms engage in exporting.
In Africa, Firm-level Gross Job Creation Rate (GJCR) stands at 13% while Gross Job Destruction Rate (GJDR) stands at 6%.
Small firms have a low chance of surviving and growing into large scale firms that are more productive. Therefore; low aggregate industrial productivity in Africa is to a greater extent attributed to a large fraction of small firms. Even with more domestic firms, domestic capital accumulation remains too low to boost adequate growth, he said.
Prof. Bbaale, pointed out some of the constraints to the potential of firms to achieve fast growth as the unreliable power supply, huge transportation costs, corruption, poor tax structures and weak laws among others.
One of longest serving professors of Makerere University Prof. Elly Sabiiti commended the great work done by Prof. Edward Bbaale and attributed this kind of achievement to formation of the Professorial Inaugural Lecture Committee in 2007. The Committee was established to guide newly-promoted professors on how disseminate the knowledge accumulated over the duration of their academic journeys for the benefit of the society.
He added that the theme of the Professorial Inaugural Lecture was relevant especially since it comes a at a time when Makerere is celebrating 100 years of excellent service with a milestone of over 90 professors.
Prof. Barnabas Nawangwe, the Makerere Vice Chancellor noted that the University contributes 70% of the research output in Uganda and 3% to the continent. He added that professors like Bbaale are expected to take the lead in the economic development of the country through their comprehensive research.
“I am glad to note that the inaugural lecture topic on “Rethinking Growth in Africa: Firms and the Business Environment Quality” is in line with the current global economic challenges arising due to the Covid-19 pandemic. Several business firms both local and international went into unprecedented decline. In Uganda, the informal sector has been greatly affected and livelihoods compromised,” the Vice Chancellor said.
The Deputy Vice Chancellor in charge of Academic Affairs, Assoc. Prof. Umar Kakumba, congratulated Prof. Bbaale upon delivering his Professorial Inaugural Lecture, saying it is a prestigious and highly regarded public talk by an appointed Professor in an academic institution.
Assoc. Prof. Kakumba said Professor Bbaale’s inaugural lecture theme was very relevant in today’s setting and has provided very important knowledge.
“Professor Bbaale has ably demonstrated the contribution of his academic exploits in economic development. Notably, his lecture is in line with the theme of the Third National Development Plan (NDP III), on “sustainable industrialisation for inclusive growth, employment and sustainable wealth creation”.”
Prof. Bbaale highlighted that overall industrial sector growth in Africa continues to fall behind GDP growth and that the manufacturing sector in Uganda has a marginal contribution to GDP at 16% as of 2020.
“He has argued for more focus on the microeconomic policy environment where business firms operate. This is expected to improve the success of the NDP III,” Assoc. Prof. Kakumba said.
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ABOUT PROF. BBAALE
Edward Bbaale is a Professor of Economics and holds a PhD in Economics, M.A. Economic Policy and Planning and B.A. Economics among other qualifications. He is currently the Dean of the School of Economics at Makerere University and the Director of EfD-Mak Centre which is part of the Global Network of Environmental Economics Research Centres supported by Sida. With support from Sida, Edward is the Lead Person at Makerere University for the Inclusive Green Economy (IGE) Capacity Development Program for Senior Civil Servants and Policy Makers. With support from the World Bank, Edward is the Principal Investigator of a Project intended to establish a Public Investment Management Centre of Excellence (PIM CoE) at Makerere University. Prior to that, Edward served as a Graduate Programmes Coordinator for the School of Economics from 2012 to 2013. He has very rich hands-on experience in economics research with a bias towards development microeconomics for enterprises and households. He was in 2017 awarded a post-doc scholarship by the Austrian Agency for International Cooperation in Education & Research (OeAD-GmbH) to undertake research at the Vienna Institute of International Economic Studies (wiiw) in Vienna-Austria. He was in 2013 nominated as a Visiting Fellow for the Journal of African Economies, Department of Economics, University of Oxford, UK. He was in 2010 nominated for the Visiting Research Fellow Position at the Centre for Global Development in Washington D.C. USA. He was in 2019 appointed a Chairperson of the Governing Council of Kampala Polytechnic-Mengo. He was in 2021 appointed a Member of the University Council at Muteesa I Royal University. He was in 2021 appointed Member of the National Task Force on the Enhancement of Labour Productivity. He is an External Examiner at Kyambogo University, University of Malawi, University of Zambia, University of Namibia, National University of Lesotho, and University of the Witwatersrand, South Africa. He was an External Examiner at the University of Zimbabwe 2015/16-2019/2020. He is a Member of the Expanded Board of the Uganda’s National Planning Authority since 2015. He is a member of Senate of Makerere University and sits on the Admissions and Mature Age and Pre-entry Committees of Senate. He was a Chairperson of a Special Task Force that developed the Student Work and Employment Scheme Policy at Makerere University. He is a member of the African Economic Research Consortium Academic Advisory Board in Nairobi, Kenya. He is the Vice Chairperson of Makerere University Deans’ Forum (MUDF). He is a member of the Scientific Committee of the United Nations Economic Commission for Africa Young Economists Network (ECA-YEN).
Edward has authored over 40 papers and, published in peer reviewed journals. Two of his papers were voted as Highly Commended Award Winners at Literati Network Awards for Excellence 2012 and 2019 (<http://www.emeraldinsight.com/literati>). At national level, he has implemented a number of policy-relevant research projects with key Government Ministries and Agencies as well as the private sector.
Dr. Elizabeth Patricia Nansubuga, Chairperson of the Makerere University Retirement Benefits Scheme (MURBS) Board of Trustees, announced this milestone during the 14th Annual General Meeting (AGM) for the year 2023/24 held on Thursday, 24th October 2024, at Makerere University Main Campus, School of Public Health Auditorium.
The AGM attracted various stakeholders, including trustees, Audit Committee Chairperson CPA David Ssenoga, Board Evaluation Consultant Vincent Kaheeru, URBRA Representative Mark Lotukei, Audit Committee members, co-opted members, and university administrators.
Presenting the performance report, on behalf of the Board of Trustees, Dr. Nansubuga highlighted that this is the highest interest declared by the scheme in the past five years, and she anticipates continued improvements. She noted that for the previous financial year, which ended in June 2023, the Board of Trustees declared an interest an interest of 12.34%.
Dr Nansubuga also announced that the scheme has achieved a Net Investment Income of UGX 44.6 billion, far higher than the UGX34.4 billion collected in Contributions during the year.
The Chairperson of the Board also revealed that the fund value had grown from UGX352.4 billion recorded at the end of the last financial year to UGX409.2 billion, indicating an increase of 16.1%.
“By 30th June 2023, MURBS had a fund value of UGX 352.4 billion. The Board of Trustees targeted Fund growth of 17%, and I am glad to inform you, that the fund value of MURBS, as per the Audited Financial Statements of 30th June 2024 is UGX 409.2 billion, which is an increase of 16.1%. This achievement was made possible by strategic periodical activities undertaken by the Board and our fund managers, supported by the strong oversight committees of the Board,” she reported.
She attributed the positive growth to factors such as improved debt recovery, operational efficiency, timely remittance of contributions by the sponsor (Makerere University), an increase in project and contract contributions, and the recovery of UGX8.85 billion in debts.
Dr. Nansubuga also expressed gratitude to Makerere University, the scheme’s sponsor, for consistently remitting contributions, a key factor that has significantly contributed to MURBS’ smooth operation. “I am happy to announce that the sponsor-Makerere University remitted your retirement benefits for the financial year 2023/24,” she said.
In the same development, Dr. Nansubuga reported that MURBS registered a legal victory against Uganda Revenue Authority (URA) over a real estate investment in Sonde undertaken in 2019, and which URA sought to tax heavily. She notified the AGM that MURBS won the case and was awarded costs which also set a precedent.
“On behalf of the Board of Trustees, I am pleased to inform you that during the financial year, we received a favorable outcome on a key court case. How did we end up with this case? In 2019, MURBS invested in real estate, we bought land in Sonde,” Dr Nansubuga explained.
“Uganda Revenue Authority (URA) then charged us with a tax assessment worth UGX600 million. It has been four (4) years in the tax appeals tribunal. Since then, the lawyers, the former and current trustees, have been appearing before the appeals tribunal, but in December 2023, MURBS won the case. We challenged URA, and this case was awarded with costs. URA has to pay MURBS. We therefore saved UGX600 million,” she added.
In terms of governance, Dr Nansubuga said that the scheme made changes in the board. Initially, the trustees were six and they needed a seventh member, and following a competitive race, they recruited another trustee; CPA Edina Rugumayo who has over thirty years in accounting.
“In terms of governance, we continue to uphold good governance practices and we align with international standards. Last year during the presentation, I said we were six and we needed to have the seventh trustee because the Board composition is supposed to be seven,” she explained.
“So, following a competitive process, we recruited an independent trustee. It was a very competitive position. You must have served on board which has over UGX50 billion. So, from that process, we were able to recruit CPA Edna Rugumayo Simbwa. She is a certified public accountant with over thirty years of experience in accounting, taxation, and corporate governance,” she mentioned.
She also thanked other stakeholders for making sure that MURBS activities run smoothly. These entities include Makerere University, KPMG, Gen Africa, Arcadia Advocates, Zamara, URBRA, and Stanbic Bank among others.
While discussing investments, Dr. Nansubuga mentioned that 86% of MURBS’ funds are currently invested in government bonds, but added that the Board is exploring diversification to reduce risks.
“86% percent of our money is invested in government bonds, and sometimes, you do not have to put all your eggs in one basket, there is a high concentration of risk. so that is one of the key material risks that we want to address to reduce the amount we have in government securities. We want to diversify our portfolio and avoid investing heavily in government securities. The Board will venture into other fields in order to earn money or return on investment from the diverse undertakings,” she said.
In terms of membership, Dr. Nansubuga reported a 4.4% increase, with the number of members rising from 8,229 to 8,590. She attributed this growth to the reinstatement of in-house beneficiaries and an increase in project and contract staff.
Dr. Kakuba also thanked the sponsor-Makerere University for remitting the membership contributions timely which has helped the scheme to grow.
Dr. Godwin Kakuba -Secretary, MURBS Board of Trustees, who presented the record of the 13th Annual General Meeting stressed that the AGM climaxes a financial year and the Board of Trustee has been vigilant on this and has not missed any AGM for 14 years now.
“We applaud the sponsor because many of these positives in the chairperson’s report can only be attributed to the support by the sponsor through fulfilling the obligation of remitting members’ contributions to the scheme,” he added.
Partner Asad Ssenoga, an independent auditor who audited the scheme said that he was impressed with the level of compliance that the scheme exhibited in all aspects. He said they focused on ensuring that the member contributions are supported with statements and allocated to members appropriately.
“Overall we were satisfied with the work we did on the audit, the numbers that were presented by the Chairperson are the correct numbers that we audited. We were comfortable with those numbers, due process was followed during the audit,” he said.
Mr. Mark Lotukei who represented the CEO of Uganda Retirement Benefits Regulatory Authority (URBRA) thanked the Trustees for always prioritizing governance, which has helped them to reach several milestones.
“As URBRA, we look at governance as the biggest component of our compliance. MURBS Trustees from the former to the current, have taken governance as the most important aspect. We really encourage them to continue with this good practice because governance informs all the other aspects,” he said.
Mr. Arthur Kibira, a member in attendance, expressed his appreciation for the Board’s efforts. He urged them to explore higher-risk investments for potentially greater returns. He expressed concern over the scheme’s heavy reliance on government bonds.
“Dr Elizabeth Nansubuga, I want to congratulate you, and your team and also congratulate ourselves. But, I want to believe that there is room for improvement. I am one of those who do not believe that the sky is the limit, we are limited by our own thinking. I am thinking that high risks give high returns. Is there a way of managing those risks, so that we could push this 13.40% interest to a figure much higher? If we do so, we shall say we have learnt how to manage risks,”, he guided.
The Research Chairs concept is similar to Centers of Excellence (for instance in supporting world-class research in a priority area), but also has many distinguishing features. Most notably, it recognizes individual excellence, leadership and talent. The O.R. Tambo Africa Research Chairs Initiative (ORTARChI) builds on the work of Oliver Tambo, a prominent South African and pan-Africanist with a science education background, who believed in creating change through education and in cooperation and solidarity among African nations. The Initiative focuses on celebrating his legacy in building knowledge-based economies for the advancement of Africa.
ORTARChI builds on and leverages existing continental frameworks and interventions geared towards institutional capacity strengthening; recruitment and retention of excellent researchers; and incentives to support research that contributes to socio-economic and transformative development.
Ten (10) O.R. Tambo Africa Research Chairs across seven (7) countries in Africa, namely; Botswana, Burkina Faso, Ghana, Mozambique, Tanzania, Uganda and Zambia have been selected for funding through a rigorous and competitive two-stage review process. These research chairs are focused on research priorities identified by each host institution in conjunction with, especially the Science Councils, and in alignment with AU Agenda 2063 and STISA 2024.
Prof. Noble Banadda from the College of Agricultural and Environmental Sciences had been inaugurated as one of the first 10 (ten) Oliver Tambo (ORTARChi) Chairs. Unfortunately, Prof. Banadda (R.I.P) passed on in July 2021, which created a vacuum. To ensure that Uganda and Makerere University continue to tap into the ORTARChi, we are glad to announce the appointment of Associate Professor David Meya from the College of Health Sciences at Makerere University for the purpose. The appointment will attract USD 170,000 annually for 5 years for graduate research with a target of training 5-6 PhDs, 10-15 Post-doctoral fellows and 10-12 Masters of Medicine and Master of Science Students at Makerere University and Mbarara University of Science and Technology.
Makerere University has had the pleasure of attending 2024 O.R. Tambo Africa Research Chairs Annual Gathering in Ouagadougou, Burkina Faso. The annual gathering is co-hosted by the Joseph Ki-Zerbo University, National Research and Innovation Fund for Development (FONRID) and the National Research Foundation (NRF) of South Africa. The theme for this year’s gathering is: “African Sovereignty: A Catalyst for Research Collaborations and Social Impact in the Continent“. At the annual gathering, Uganda was represented by Associate Prof. David Meya (Uganda Chair Elect, ORTARChI), Prof. Henry Alinaitwe (Deputy Vice Chancellor Finance and Administration, Mak), Associate Prof. Robert Wamala (Director, Research and Graduate Training) and Dr. Martin Ongol (Ag. Executive Secretary, UNCST). Assoc. Prof. David Meya – ORTARChI Chair Elect – is from Makerere University’s School of Medicine at the College of Health Sciences.
Hoima and Kikuube Districts, Uganda – October 20, 2024
A group of third-year students from College of Business and Management Sciences’s Energy and Natural Resources Economics program visited the Kingfisher oil operations and Kabalega Airport in Hoima and Kikuube districts on October 20, 2024. Led by Dr. Peter Babyenda and Dr. John Sseruyange, and with authorization from the Petroleum Authority of Uganda, the visit offered the students an invaluable opportunity to connect classroom learning with field experience.
The primary objective of the field trip was to enhance students’ practical understanding of Uganda’s oil industry by observing the extraction and production processes firsthand. According to Dr. Babyenda, “Blending theory with real-world exposure is essential for these students, as it allows them to apply and expand their knowledge beyond the classroom.”
During the tour, students explored several key areas:
Practical Exposure – Witnessing the operational procedures of oil extraction offered students a concrete understanding of how theoretical concepts play out in the field, enhancing their grasp of the industry.
Economic Impact Analysis – Observing the economic role of oil production in Hoima and Kikuube allowed the students to explore its broader impact on local and global markets and its contributions to community development and Uganda’s economic landscape.
Technical Knowledge – The students gained insights into the technical aspects of oil extraction, learning about the complexities of the operations, the innovations employed, and the challenges faced by the industry.
Environmental and Social Considerations – Students observed the environmental practices in place and evaluated the social dynamics involved, gaining an understanding of how oil companies balance production with community and environmental sustainability.
Career Insights – With opportunities to interact with professionals in the oil sector, students received guidance on potential career paths in the industry, helping them make informed decisions about their futures.
Current Industry Issues – The group also delved into the status of the East African Crude Oil Pipeline (EACOP) project and discussed challenges in oil and natural gas production, examining where Uganda stands in terms of production timelines, obstacles, solutions, and the role they can play as future energy professionals.
Reflecting on the trip, Dr. Sseruyange highlighted the importance of this experience in solidifying students’ understanding of Uganda’s evolving oil industry. “This field experience not only complements what they’ve learned in lectures but also equips them with a real sense of the operational and societal impact of the energy sector,”he noted.
The students expressed their gratitude for the immersive experience, noting how it broadened their perspectives and deepened their knowledge. The field trip served as an essential step in preparing them for careers within Uganda’s energy and natural resources sectors, bringing them closer to the industry’s forefront and the future of sustainable energy in the region.