Budget of big ‘ifs’

Focus on ICT and skilling

Minister Kasaija noted that increased electricity generation and transport infrastructure, and provision of basic health and education through UPE and USE have enabled the economy to produce basic manufacturing products such soap, sugar, cement, and light steel products. He said the next phase is production of same goods for export and import substitution. This strategy to ensure that most Ugandans are proactively engaged is commodity based. However, it misses a critical point; that we are entering a critical point in the digital age; the era of the fourth industrial revolution. The Internet of Things (IoT) is set to change how people live, work and relate to each other and with machines and technology. If the speed in the Third Industrial Revolution dominated by electronics and information technology has been fast, what is coming will be dizzying. Artificial intelligence, self-driving cars, 3-D printing, nanotechnology, biotechnology, quantum computing and the connection of millions of digital devices through unprecedented processing power and databanks requires a rethink of strategy.

Focusing on industrialisation for job creation and shared prosperity is traditional linear thinking. As Klaus Schwab, the Founder and Executive Chairman of the World Economic Forum, said in the Fourth Industrial Revolution; “We need to shape a future that works for all of us by putting people first and empowering them”.

On this, there is a fascinating paper that Matia Kasaija and other politicians and technocrats in the government need to read to see how a government official works to transform an economy. It is titled `Political entrepreneurism: Reflections of a civil servant on the role of political institutions in Technology Innovations and Diffusion in Kenya”. It was written by Elijah Bitenge Ndemo; a business professor who was in 2005 abruptly appointed by President Mwai Kibaki as PS of the Ministry of ICT and worked with a new minister, Mutahi Kaggwe, and the private sector to push through policy reforms and practical innovations that propelled Kenya as a regional ICT hub.

President Kibaki allowed them a free hand. He simply told them: “Mambo ya Information and Communication Technologies, ICTs, ni yenu sasa, sisi ni wazee” (Everything to do with ICTs, is for you to deal with, we are now old people).

What is unique about these two is how they were strategised and prioritised.  First they established a powerful ICT team, and together with major stakeholders drew up an ICT Master Plan Summary to break through some archaic regulations set up by the previous government of President Daniel arap Moi; including a ban on the use of any communication technology such as computers, fax machines as enforcement of the Official Secrets Act. They found the EAC leaders fumbling for years with the East Africa Cable Submarine System (EASSY) and quickly conceived The East African Marine Systems (TEAMS) that laid the undersea fibre optic cable from the United Arab Emirates even as the country was going through the 2008 political upheaval and Kibaki launched it in 2009. They also developed rural ICT centers, subsidised broadband to universities, subsidised students to purchase laptops, digitized government registries, support Business Processing Outsourcing start-ups, and got the government to acquire high speed broadband in all of its offices. They set up software coding competitions involving university kids. Local and international ICT enthusiasts swarmed Nairobi.  That is how MPesa and other ICT innovations happened.

Under the sub-topic `Entrepreneurial Failure and culture of handouts’ Ndemo concludes, that their rural ICT strategy failed.

“Of the 36 centers built, only five were viable and capable of repaying the US$50,000 loan advanced to them. In retrospect, we did not spend enough time in planning and developing a business case for each entrepreneur. Although we trained those who were recruited to run the enterprises, the recruits’ backgrounds were not suited for entrepreneurship, and the team should have taken into greater consideration regional, ethnic and gender factors that sometimes are in conflict with the desired outcomes.

“Many years of handouts (grants) had eroded any understanding of other forms of financing, such as loans, in this case to the extent that majority of recipients had no intention of repaying the loan. With such intentions, some recruits diverted the loan into other uses depleting their operational expenditure”.

If President Museveni and others who see cash handouts as a way of creating jobs and sharing economic prosperity read Prof. Ndemo’s experience, they will find that educating and skilling the population works better. That is what China, Malaysia, India, the Koreas, and Japan have done to succeed.

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