Uganda – Corrupt Payments

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Parliament orders the repayment of fees paid to 42 officials following a victory in landmark tax arbitration case. 

The Ugandan Parliament has ordered all 42 government officials who had received a payout to refund the Ugandan Shillings (UShs) 6 billion that they had shared as a reward by President Yoweri Museveni for winning a landmark arbitration tax dispute.

The tax dispute related to British-based oil firms Heritage Oil and Gas and Tullow Oil. In July 2010 Heritage Oil and Gas sold its assets in Uganda to Tullow Oil for US$1.5bn, with the Ugandan Revenue Authority (URA) issuing a tax bill of $434m.

In May 2011, Heritage Oil and Gas initiated arbitration proceedings against the Ugandan Government for the release of $405m held by the URA following the scale of interests in oil blocks 1 and 3A in July 2010.

The case against Heritage Oil and Gas was decided in Uganda’s favour and therefore upheld URA’s assessment of $434m as Capital Gains Tax, reported Uganda-based, the Independent.

The payment to the 42 officials was a reward for their purported role in the arbitration case.

Most of the beneficiaries who received between UShs50m and UShs200m had also profited from a UShs56bn money pot which was passed by Parliament across seven financial years to facilitate Uganda’s legal team to prosecute the tax case against the two British oil firms.

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President Yoweri Museveni – CC 2012.

However, some senior officials who took a share snubbed the Parliament’s directive for a refund. They stated that they cannot refund the money since President Museveni supported the payment.

Solicitor General Francis Atoke, who pocketed UShs234m, said, “why should I (refund the money)? The money was paid to us, we did not ask for it even when we handled the case. It was the principal (Museveni) who gave us (the money) and we used it, so refund what? There is nothing to refund.”

While the parliament committee’s report does not explicitly name the officials, it accuses URA Commissioner General Doris Akol of violating the URA Act and Public Finance Management Act when she authorised withdrawal of UShs6b from URA account, reported the Monitor.

The notable beneficiaries of the so-called presidential handshake also include Uganda National Roads Authority (UNRA) Executive Director Allen Kagina and Kampala Capital City Authority (KCCA) Executive Director Jennifer Musisi among others, reported the Observer

Uganda continues to suffer from widespread corruption, which hinders business and investment in the country. There have been numerous reports of bribes and under the table payments within high level government circles.

Find out more in the Africa Research Bulletin:

ROADS AND RAILWAYS: Uganda
Economic, Financial & Technical Series.
Vol. 54, Issue. 2, Pp. 21618B–21619B 

UGANDA: Drought Hits Hard
Economic, Financial & Technical Series.
Vol. 53, Issue. 12, Pp. 21533A–21534A

UGANDA: Kasese Inaction Criticised
Political, Social & Cultural Series.
Vol. 54, Issue. 5, Pp. 21445A–21446C

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Zambia – Opposition MPs Suspended

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As the leader of the opposition remains in jail the government suspends over forty opposition MPS. 

On June 12th the Speaker of the National Assembly Patrick Matibini suspended 48 United Party for National Development (UPND) MPs for 30 days. The MPs had boycotted President Edgar Lungu‘s address to the National Assembly.

They refused to attend address in March as they argued Mr Lungu was not the legitimate winner of the election in 2016.

“Let me inform you that your conduct of boycotting the President’s address as a way of protest was unjustified and unbefitting the conduct of an MP. The President is the Head of State and Government, and you took oaths of allegiance,” Matibini said.

As they were suspended the Times of Zambia reported that the UPND MPs were directed to immediately leave the House, described as a ‘walk of shame’ as Patriotic Front MPs burst into laughter.

This is the latest in recent targeting of opposition members. At the end of May imprisoned opposition leader Hakainde Hichilema returned to court facing charges of treason.

Hichilema and five others were arrested on April 11th following an incident in which the convoy he was travelling in refused to give way to the presidential motorcade. He is accused of endangering the President’s life, although his lawyers argue the charges are politically motivated.

Legal gymnastics have kept Hichilema in prison and he has been moved from one Magistrate to another. Betty Malupenga is the third magistrate handling the case, reported Zambia Reports.

UPND_campaign_rallyUPND Campaign Rally 2016 – CC

Since losing elections in January 2015 Hichilema had, according to Zambia Reports, endeavoured to ‘carry himself like a man with official state power’. He repeatedly picked fights with President Lungu and other government members, labelled the judiciary corrupt and scolded the police as incompetent. Although commentators say that this is his right as a political person.

Speaker Matibini warned Hichilema and other leaders of political parties and the general public, that their comments relating to matters of the House should be made within the confines of the law. He said if they continued to do so, they risked being liable to be prosecuted, reported the Times of Zambia.

The Zambian government has also faced criticism from the Zambia Conference of Catholic Bishops over the handling of the case against Hichilema, who warned that country is slipping towards ‘dictatorship’, reported BBC News

Find out more in the Africa Research Bulletin:

ZAMBIA: Hakainde Hichilema Arrested
Political, Social & Cultural Series
Vol. 54, Issue. 4, Pp. 21396C–21397A

ZAMBIA: Re-Election Bid?
Political, Social & Cultural Series
Vol. 54, Issue. 1, Pp. 21287C–21288C

ZAMBIA: Information Minister Dismissed
Political, Social & Cultural Series
Vol. 53, Issue. 11, Pp. 21209C–21210A

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South Africa – Economy in Recession

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As most economic sectors contract many point finger of blame at corruption within the ruling party. 

According to data from Statistics South Africa, the country as slipped into recession for the first time in eight years, largely due to weak manufacturing and trade sectors. In the first three months of 2017 the economy contracted by 0.7%.

The trade, accommodation and catering sectors were the worst performing, contracting by around 5.9%, while manufacturing contracted by 3.7%. The value of the South African Rand (R) also dropped by around 1%.

Standard Chartered Bank’s Chief Africa Economist Razia Khan said the data showed weakness where it was not expected; the country had been predicted to have relatively high growth rates. Nonetheless, Joe de Beer, Deputy Director General of Statistics South Africa, said, “We can now pronounce that the economy is in recession.”

South Africa’s economy showed marginal positive growth for 2016, although it then contracted in the fourth quarter. The only sectors to have made a positive contribution to output growth in the country have been mining and agriculture, reported the Conversation Africa.

“The slowdown in first quarter was due to much worse results from usually stable consumer-facing sectors that had been the key drivers of growth in recent years,” Capital Economics Africa economist John Ashbourne said.

Political instability, high unemployment and credit ratings downgrades have hit business and consumer confidence, while government bonds have also weakened.

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President Jacob Zuma – CC 2011.

Pressure on President Jacob Zuma, including from within his African National Congress (ANC) party, has risen since a controversial cabinet reshuffle in March that led to downgrades of South Africa to ‘junk’ status by ratings agencies S&P Global Ratings and Fitch.

“Our economy is now in tatters as a direct result of an ANC government which is corrupt to the core and has no plan for our economy,” Mmusi Maimane, the leader of the opposition Democratic Alliance (DA) said, reported the Premium Times.

The concern is that South Africa needs strong economic growth to help reduce unemployment levels, which currently stand at more than 27%.

In a statement, the Government of South Africa said that the current growth rate, if sustained, will lead to a further decline in GDP per capita, risking the sustainability of our fiscal framework and undermining the delivery of social services.

The government added that the Minister of Finance Malusi Gigaba would be seeking a meeting with business leaders to discuss ways of working together to achieve inclusive economic growth.

Find out more in the Africa Research Bulletin:

SOUTH AFRICA: Credit Downgrades Deepen Turmoil
Economic, Financial & Technical Series
Vol. 54, Issue. 3, Pp. 21637B–21639B

SOUTH AFRICA: Anti-Immigrant Protests
Economic, Financial & Technical Series
Vol. 54, Issue. 2, Pp. 21596A–21598C

SOUTH AFRICA: Growth Falls
Economic, Financial & Technical Series
Vol. 54, Issue. 2, Pp. 21605B–21606A

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Egypt – ‘Tribal’ Coalition

An organisation of tribes in the North Sinai, in cooperation with the army, aims to counter the Islamist threat.

In the North Sinai, a number of ‘tribal’ groups have taken up arms against the so-called Islamic State (ISIS aka Daesh), after Islamist militants attacked the Tarabin, a key Sinai tribe, which prompted them to form a coalition in collaboration with the Egyptian army.

In mid April ISIS reportedly attacked two pick up trucks belonging to the Tarabin, and abducted two people. The following day the Tarabin besieged Rafah’s Al-Barth market and arrested two members of the group.

A week later ISIS attacked Tarabin youths killing four, subsequently prompting the Tarabin to capture and burn alive an ISIS member.

On April 29th the Tarabin invited North Sinai tribes to meet, where they formed the Sinai Tribes Union (STU), led by tribal chief Abdul-Majeed al-Mene’I from the Sawarkeh, the largest tribe in the Sinai region.

Other tribes include the Rumeylat, the Tiyaha and the Fawalhriyeh. Since the formation of the STU both sides have engaged in attacks, and a young Tarabin businessman named Salem Abu Lafi was killed.

However, some warn of negative consequences in the long run. “All expected scenarios of Sinai tribes carrying arms are dangerous, because the confrontation with Daesh could turn into revengeful armed conflicts among tribes… and this could get out of the Egyptian state’s control,” security expert and former intelligence officer Mahmoud Zaher told Qatari Al-Arab daily.


North Sinai Map

Further, an Egyptian appeals court overturned on May 4th death sentences for 25 people over deadly tribal clashes in the country’s south, ordering a retrial. The men had been convicted of taking part in 2014 clashes in the southern Aswan province that killed 28 people.

Tribal reprisals are common in the rural south. In 2014 a long-standing rivalry between the Bani Hilal, an Arab tribe, and the Dabudiya, a Nubian tribe, flared after a man from one sexually harassed a woman from the other.

The two sides had sought to resolve tensions with a reconciliation meeting, but it degenerated into a firefight that killed three Bani Hilal members. (© AFP 4/5 2017; BBC Monitoring 17/5)

Find out more in the Africa Research Bulletin:

EGYPT: Church Bombings
Political, Social & Cultural Series
Vol. 54, Issue. 4, Pp. 21401C–21402C

EGYPT: Christian Exodus
Political, Social & Cultural Series
Vol. 54, Issue. 3, Pp. 21364C–21365B

EGYPT: Military Gains, Militant Retaliations
Political, Social & Cultural Series
Vol. 54, Issue. 1, Pp. 21292B–21293B.

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Cote D’Ivoire – Mutiny Ends

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Mutinying soldiers agree to government deal ending days of protests and tensions across the country. 

On May 16th it was reported that a four day mutiny by ex-rebel soldiers ended after a government offer was accepted. The mutiny had hit cities and towns across the country and paralysed many services.

“We accept the government’s proposal … We are returning to barracks,” said Sergeant Seydou Kone, one of the revolt’s spokesmen, in the country’s second largest city, Bouake.

The offer included an amendment on bonus payments, which some of the rebels have already received. The government had offered an immediate payment of CFA Francs 5m followed by CFAf 2m the following month.

The mutiny was started by around 8,400 soldiers, who were mainly former rebel fighters who had helped President Alassane Ouattara to power, subsequently being integrated into the national army.

It follows another mutiny in January this year, after which the government agreed to pay the rebels CFAf 12m (18,000 euros) each. Although the government failed to follow up the deal, paying only a partial amount.

The recent mutiny was triggered after a group from the January protestors apologised to President Ouattara and the head of the army on national television, saying they would not pursue the bonuses anymore.

During the tensions one person was left dead after the mutinying soldiers fired on residents protesting against them in Bouaka.

Heavy gunfire was also reported in Abdijan and Bouake on May 15th, with the latter sealed off by the mutineers. Gunfire also broke out in San Pedro, and mutineers blocked the main border crossing to Burkina Faso.

Many businesses and schools were closed, alongside the main banking association in the country, APBEF, which decided to close all banks. The four day mutiny paralysed economic activity in the country.

The deal to end the protests also came after the authorities conducted a military operation “to re-establish order”.

However, the government has struggled to make the payment, with a budget hit by the collapse in the price of cocoa, the country’s main export.

In 2016, the government unveiled an ambitious plan to modernise the 22,000 strong military, part of which would involve the departure of several thousand men, particularly former rebels, who would not be replaced. (Al-Jazeera 15/5; Deutschewelle 16/5)

Find out more in the Africa Research Bulletin:

COTE D’IVOIRE: Fresh Mutinies
Political, Social & Cultural Series
Vol. 54, Issue. 2, Pp. 21327C–21328B

Côte d’Ivoire – Mutiny in Major Cities
Political, Social & Cultural Series
Vol. 54, Issue. 1, Pp. 21290B–21290C

CÔTE D’IVOIRE: Legislative Poll [Free to Read]
Political, Social & Cultural Series
Vol. 53, Issue. 12, Pp. 21247C–21248B

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Health – Malaria Vaccine Trials

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Three Africa countries are selected for first phase of a Malaria vaccine pilot. 

The World Health Organisation (WHO) has announced that Ghana, Kenya and Malawi a are to be pilot countries for a new Malaria vaccine for young children from 2018. The vaccine has the potential to save tens of thousands of lives.

The vaccine was developed by GlaxoSmithKline and will be tested on children aged five to 17 months; it has taken decades of scientific and medical expertise to produce, and hundreds of millions of US dollars in funding.

The funding of US$49m for the first pilot phase is being funded by the Global Vaccine Alliance (GAVI), UNITAID and the Global Fund to Fight Aids, Tuberculosis, and Malaria.

However, the vaccine only has partial effectiveness, and the challenge is whether countries can deliver the required four doses per child, said WHO Africa Regional Director, Matshidiso Moeti.

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CC Radio Okapi 2006

Malaria infects roughly 200 million people each year, killing roughly half a million people, and Sub-Saharan Africa is hit particularly hard, with 90% of the world’s cases in 2015.

According to the WHO, modelling and data gathering has been so bad that it has been hard to tell if cases have been rising or falling over the last 15 years.

Kenya, Ghana and Malawi already have fairly strong prevention and vaccination programmes, but were chosen as they still have a high number of malaria cases. The vaccine will be delivered through existing health provisioning systems.

The WHO has stated its aim to wipe out the disease by 2040, although so far it has proven stubborn, with resistance problems to both drugs and insecticides.

According to Kathryn Maitland, Professor of Tropical Paediatric Infectious Diseases at Imperial College London, writing in a academic paper published in December 2016, “the slow progress in this field is astonishing, given that malaria has been around for millennia and has been a major force for human evolutionary selection…contrast this pace of change with out progress in the treatment of HIV, a disease a little more than three decades old.” (The Independent 24/4)

Find out more in the Africa Research Bulletin:

HEALTH: Malaria
Political, Social & Cultural Series
Vol. 54, Issue. 4, Pp. 21416A–21417C

HEALTH: Wiping Out Polio
Political, Social & Cultural Series
Vol. 54, Issue. 3, Pp. 21381B–21381C

HEALTH: HIV Treatment Soars
Political, Social & Cultural Series
Vol. 53, Issue. 11, Pp. 21236A–21237C

Subscribe to the Africa Research Bulletin today. 

 

Nigeria – Airline Takeover

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After a takeover by the government, the largest carrier in the country is trying to recover.

Investors are eying up airlines that the Assets Management Corporation of Nigeria (AMCON) has taken over, particularly Arik Air and Aero Contractors. AMCON took over Arik on February 9th due to Naira (N) 135 billion in debt.

Nigerian news service This Day reported that the federal government intended to sell Arik Air through AMCON. However AMCON has reportedly been changing the figures of the debt, reducing a previous figure of N300bn to N126bn.

An industry source said that the drastic fall in the exchange rate of the naira in 2016 critically affected many companies in Nigeria. Arik Air was largely funded by international finance institutions including, the US-Exim Bank, the Export Development Company of Canada, and Afrexim Bank. Arik owes Afrexim $24m and EDC $48m, with repayment dates set for 2020.

The Federal Government claims it has three programmes to revitalise the aviation industry, including establishing a national carrier; establishing maintenance, repair and overhaul facility; and the concession of the nation’s airports.

However, aviation industry experts have cautioned against the alleged plan to sell Arik Air and Aero Contractors, querying if how this would benefit Nigeria and make the airlines profitable.

However, AMCON has injected N1.5bn into Arik Airlines to safeguard operations, CEO Roy Ilegbodu said the funds were essential to the continued viability of the airline. He said KPMG had been appointed to carry out a proper audit.

Arik Air has also announced the resumption of flights to Maiduguri in Borno state, four years after operations were suspended for security reasons. The first flight commenced on May 9th.

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Meanwhile, the Managing Director of the Nigerian Airspace Management Agency (NAMA) Fola Akinkuotu has commended the Minister of State for Aviation Senator Hadi Sirika for the successful repair of the Abuja Airport runway.

The runway was closed for six weeks due to deterioration and safety risks. Many passengers were diverted by Kaduna airport, facing its own security risks.

There were, however, significant financial losses caused by the closure, especially due to a drop in passenger traffic. In the first three weeks of operations in Kaduna, Nigerian airlines said they lost around N10bn.

Similarly, passengers who passed through Kaduna said that it was a cumbersome experience, with a three-hour bus ride from Kaduna to Abuja city.

(Premium Times 3/5; The Guardian, Lagos 18/4; This Day 23, 28/4, 5, 7/5)

Find out more in the Africa Research Bulletin:

AIRPORTS AND SERVICES: Nigeria
Economic, Financial & Technical Series
Vol. 54, Issue. 2, Pp. 21616A–21617C

AIRPORTS AND SERVICES: Africa
Economic, Financial & Technical Series
Vol.54, Issue. 3, Pp. 21651A–21652B

AIRPORTS AND SERVICES: Africa
Economic, Financial & Technical Series
Vol. 53, Issue. 11, Pp. 21504A–21506A

Subscribe to the Africa Research Bulletin today.