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Museveni’s Rejection of National Local Content Bill Sparks Fire Storm

President Yoweri Museveni’s refusal to assent to the National Local Content Bill has attracted fierce criticism from a section of legislators who accuse the Government for forsaking local entrepreneurs.

At the passing of the draft law on May 20, 2020 it was hoped to enhance the participation of locals and resident companies in public procurement.

However, their hopes were quickly dashed when President Museveni declined to append his signature citing ten areas that he said, risked putting Uganda on collision course with the international community.

In his August 18, 2020 letter to Speaker Rebecca Kadaga, Museveni specifically took aim at Section 4 of the bill in its entirety arguing that prioritizing locally manufactured goods and products in procurement deals contradicts the propositions of the East African Community.

“The Bill conflicts with the East African Monetary Union signed on 30th November, 2013. Under article 13 of the Customs Union Protocol, the EAC partner states agreed to remove all existing non-tariff barriers to trade and not to impose any new ones,” Museveni stated.

“The bill is likely to put Uganda at loggerheads with East African Community partner states. It should be noted that currently, citizens of East African states are freely working in the countries of their choices within the East African with limited restrictions,” he added.

According to Section 4 of this bill, firms undertaking public business were supposed to ensure that products or services used are partly or wholly manufactured from Uganda and where doubtable, the rules of origin applicable in the East African Community would be applied.

Such goods or services would only be rejected if they fail to meet quality/quantity targets in time.

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“Where a good locally manufactured in Uganda or a service provided by a Ugandan citizen or company does not meet the required quality, quantity or timeline for delivery or completion, the local content entity may with written authorization of the department, procure the good or service as directed,” Section 5 (2) stipulates.

However, addressing the press on Friday October 2 2020, the mover of this bill and Kassanda North Member of Parliament Patrick Nsamba Guma Oshabe castigated the president for downplaying the interests of nationals.

“This is an affirmative action law with the purpose of increasing the participation of Ugandans. It is not for increasing the participation of Europeans. So they are right in their way or the donors in their way, they are right. They are very right to come and claim, please don’t prioritize Ugandans, that is not the concern,” Nsamba ranted.

Nsamba said nonetheless that they would revisit some of President Museveni’s concerns but warned that Parliament would not bow to the goals of the regional bloc.

“We are going to make amendments and see how we can maximize or quicken the procurement process. What we are not going to respect is that aspect of the East African Community yet other countries are doing their own things,” he intimated.

Other concerns

It is understood that President Museveni is also against the idea of enacting a Local Content Department under the Minister in charge of Finance, Planning and Economic Development (MOFPED) as far as implementing this law is concerned.

“It is not feasible for one department to approve local content plans from bidders, for each individual procurement for the whole country,” he argues.

It is understood that this issue was among the key talking points during today’s meeting between Speaker Rebecca Kadaga and European diplomats that took place at Parliament.

Taking no prisoners, Anna Merrified the Acting Head of the European Delegation expressed reservation on this law saying it was close to impractical.

“I think there is a risk if we kind of pick local producers against the foreign producers. In different kinds of technology projects, I think there is a lot of technology that is simply not yet available yet on the market,” Merrifield intimated.

 

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