Our Friends at the Bank

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The economic development of many countries depends on an institution now fifty years old, the World Bank. Often criticized and blamed for politically unpopular policies, and confronted with numerous setbacks, the Bank is experiencing a difficult time with regard to which strategies to adopt, in particular in Africa.

Uganda, a country that emerged from the dictatorship of Idi Amin and years of civil war with relatively high rates of economic growth, is one of its 'model cases.' OUR FRIENDS AT THE BANK looks at the relationship between the Government of Uganda and the World Bank over a period of 18 months, filming with unprecedented access events at the highest levels of both, and their many encounters and exchanges.

High-level teams set up by the Bank's new President, James Wolfensohn, and by Uganda's President, Yoweri Museweri, confront each other. The stakes are enormous. The Bank defends, as does its sister organization the International Monetary Fund, an ultra-liberal economic and financing philosophy which poorly matches the priorities, and above all, the ferocious desire for independence of the Ugandans.

While Uganda feels a need to increase military spending to fight a violent insurgent movement, the Bank answers to donor countries and asks for details and explanations. In economic development policy the government favors investment in 'hard infrastructure' such as roads, while the Bank argues for prioritizing education. The film also shows how the IMF can weigh in as a third voice, in bilateral discussions with the World Bank in Washington, or directly with the Government on issues such as economic projections and how they affect development financing, tax rates and policies. Finally, and contentiously, OUR FRIENDS AT THE BANK shows how accepting aid from these world agencies involves implementing the larger economic philosophy of free trade, and often reluctant and painful privatizations.

But do the Ugandans have any choice, faced with enormous debt weighing heavily upon them, and the realities of the global economic system?

Traveling between Washington, DC and Uganda, Peter Chappell followed the negotiations between the World Bank and Uganda in order to understand and describe the mechanisms that shape the reality of North-South relations, economic and political policy, as well as the future of millions of people.

'It is a triumph, full of insights and shrewd observations about the relationship between Uganda and the World Bank, making it essential viewing for anyone interested in aid and development. I sat engrossed as Ugandan government officials, representatives of the Bank, and western diplomats discussed and debated the issues at stake with such frankness and passion.'-Michael Holman, Africa Editor, Financial Times

'Appropriate for use in introducing a wide range of undergraduate students to the issues surrounding the World Bank. For example, professors in Economic Issues, Principles of Macroeconomics, International Economics and Development Economics courses could design modules about the World Bank that incorporate this film ... the variety of topics that it introduces, together with the fact that it provides both the World Bank and the developing nation viewpoints, makes it an ideal enhacement to any course that seeks to help students understand the institutional framework of the world in which they live.'-International Teaching Resources for Business

'A penetrating 'insider' look at the World Bank's, and to a lesser degree the International Monetary Fund's and donor governments', interaction with borrower governments.'-Economic Justice News

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Main credits

Chappell, Peter (commentator)
Chappell, Peter (film director)

Other credits

Camera, Todd Berger; editor, Catherine Zins.

MARC Record See Worldcat record

Keywords

World; Bank; globalization; Uganda; Africa; James; Wolfensohn; Yoweri; Museweri; Peter; Chappell; IMF; International; Monetary; Fund; documentary; film; video; "Our Friends at the Bank"; Icarus Films

WEBVTT

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[sil.]

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May 1995,

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a trunk road in Southern Uganda.
To the north lies Sudan,

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to the east Congo once known as
Zaire and to the southeast Rwanda.

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Compared with its neighbors, Uganda is neither
the most developed, nor the most stable.

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This ex-British colony is seen as one of
the bright hopes for development in Africa

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even though its economy remains
in the words of foreign advisors,

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extremely fragile.

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[sil.]

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Uganda is utterly dependent on loans
and heavily burdened by debt.

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Yet its conversion to a free market economy
is seen as a model for development

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by the country\'s principal
creditor, the World Bank.

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June 1995, Washington,

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Headquarters of the World Bank. The bank was
created along with the International Monetary Fund

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to finance the reconstruction of
Europe after the 2nd World War.

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It has now become the most important
source of loans for the developing world.

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There are a 180 member countries, but
it is controlled by the richest,

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led by America, which by tradition appoints
the President. Australian-born financier,

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James Wolfensohn has left a career on
Wall Street to run the World Bank.

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[sil.]

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This is his first day in the job.

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[sil.]

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And the reason that I am here is because I
think that there is an issue in the world,

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of social justice and the eradication of
poverty. I think there are issues in the world,

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of the environment, of education and of
health. Wolfensohn insists on change.

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He recognizes that the liberal
policies of the 1980s

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have produced few viable models and in Africa,
more than a third of the bank\'s projects fail.

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[sil.]

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From top to bottom of the hierarchy, a new
order, new directions for the 7000 functionaries

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who work at the bank.

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[sil.]

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We have been in a very pleasant world where
everybody could do exactly what they want to do.

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That world is over, partly because it wasn\'t
such a good thing. American Jim Adams

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responsible for reorganizing the bank\'s
East Africa department. But the reality is

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some of the definitions we have used in the past are going to
have to go out of the window and we are going to have a hard job

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in terms of explaining to people
how the old world we lived in

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is not the same world. I mean
look at Uganda, I mean the

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hat was it, nine months ago, uh…
the Ministry of Finance came in

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and sat with the country team

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and the country team gave him and his
colleagues the lending program and he said,

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\'I don\'t want nine-tenths of these things.\'
Now, since then, in fact, the lending program

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has not significantly changed. We know

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that President Museveni
when he meets Wolfensohn,

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umm… is going to say he wants more roads.
How we have gotten into this situation?

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Well, but my actually let me convey. Let me let me let me Ah, you have
got the right problem, well, how we get Museveni is going to come,

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I get to go to New York, now I will be in his hotel
suite, I will be sitting there with my boss,

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Mr. Wolfensohn, who thinks most of
us in the bank needs some educating

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and Mr. Museveni is going to say, I have been
yelling at these guys for the last two years,

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I want roads. And Wolfensohn is going to
turn to me and I have been here three months

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and he is going to say ‘why the hell aren\'t you doing what this
obviously intelligent man wants to do?\' What are you going to say?

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Well, I am going to sit there and
I am going to have to take it,

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I am going to get my head
clobbered, I am going to take it,

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no, I am not going to sit there and say, well, I have got a bunch of jerks working for me who won\'t
listen, I have enough of institution, I am enough of a bureaucrat, but I am not going to do that.

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But I don\'t want 12 months
from now to be in a situation

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where Mr. Museveni comes to me and says, ‘where the hell
are my roads?\' Okay, that\'s fine, but that\'s simply

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No, how you are going to do it? But let me tell you, what I hear you
did No, no, I want the answer. None of this is two-headed stuff.

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What\'s two headed? Can I tell
him that over the next year,

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we are going to do whatever God damn road you
want to do Mr. Museveni. That\'s one solution.

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[sil.]

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It is 0-7-7, isn\'t it?

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Yeah, that the President\'s conference room,

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we will go this way, this way. Yeah.
Uganda Minister of Finance,

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Joash Mayanja-Nkangi arrives at the Bank
to discuss his country\'s lending program.

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He needs 400 million dollars to
rebuild Uganda\'s road system.

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[sil.]

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Very glad to see you, how are you?
Glad to see you.

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American Kim Jaycox is Vice President for
Africa. He decides how the bank will loan money

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throughout the entire continent. In the
new changed world, as Jim Adams says,

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the bank is looking for social programs.

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[sil.]

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Ah, it\'s a pleasure to see you here in Washington.
Thank you so much for what you are doing for us

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in Uganda, but we have had a long
meeting with him for about two hours,

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again, so I thought we should brief you and then if anything
you want to No, I find you keep a track of these guys back,

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they work on Uganda for a
long time in the bank,

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am I right, but the way this has been
reported to me it\'s not so much that

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you all are pro, you know,

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like have a high priority for infrastructure, but you have
sort of a negative priority for some of the other stuff

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that we have been involved with
for a long time, for instance,

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primary schooling and basic health
and that like, is that correct?

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No, sir, I think if one is forced,
is it infrastructure on our roads,

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or primary schools, primary education?
If just either or,

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then (inaudible) from this juncture would say, let\'s
have roads first. It\'s not a question of primary school

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or secondary, tertiary, vocational,

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or it\'s a question of, uh… the balance always.
Okay. And we need to discuss this because

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you know the way we look at it, the kids aren\'t
getting educated, you got a health problem

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in Uganda that is what,
is very, very serious.

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We\'ve got uh… the feeder roads
are not being maintained.

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I mean, if these all were happening, I would never
(inaudible) edged or something that we would definitely,

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but these are the sort of
the development issues.

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Now, you see, instead of pushing one area,

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possibly to material neglect together,

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we should try and push them together where it\'s
necessary, particularly from the point of view

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of potential growth in the economy.

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We found that as a matter of experience now,
that however number of how many schools,

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take primary schools, learning to read
the Bible or the local newspapers,

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that will not help us to take off.
We can go (inaudible),

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but that won\'t help us really to move into

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(inaudible) like the secondary
phase of industrial,

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you know, of development. No, well, you can\'t go
to the other side without this base. I am saying

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that if people don\'t know how to read and
write and count, and add and subtract,

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they are not going to be able to engage in the modern age,
that\'s all there is to it. That\'s my going in position

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and I want you to understand that that is
a going in position. I agree with you.

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And I have got a lot I have got a stack of evidence and you are going
to have to overcome that evidence if you are going to win this target.

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[sil.]

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In New York, James Wolfensohn, a former Wall
Street banker and now President of the World Bank

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is meeting Yoweri Museveni, once a guerilla leader and now
President of Uganda. So (inaudible), I think you got my letter.

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I did indeed. I did indeed.

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I think the main (inaudible) now
to our development are the roads.

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So if the roads were opened, the
major ones and the feeder ones,

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then a number of things
would happen, first of all,

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the peasant would be able
to market their crops.

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Then the traders will be able to
easily carry goods to the rural areas.

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Then also the investors
would find it easier

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to go up country and invest their
so roads go into everything.

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They affect tourism. Tourists
don\'t want to bump on roads

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for 20 hours, they want to drive
smoothly and go back to the town.

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So they affect everything. Yeah,
you don\'t have to convince me.

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If you take roads, you must maintain them.
And I think what we did previously

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was to help on the road maintenance and we
are now looking at the new road program.

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In my previous (inaudible) fighting,
I was used to prioritization.

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It was our friend, Mao Tse Tung who
told us that to hit with both arms

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in two directions at the
same time is bad fighting.

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You would rather fold your arms and you
concentrate on your blow in one area,

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and achieve your target.
Obviously, we agree that

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roads are essential for development. The
question of whether it\'s the only thing you do

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or whether it\'s the first thing you do or and
it\'s clear now I think as a matter of priority

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that we should take a look at it. So
my guess is you will get your way

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which I think you are used to doing.

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But you will have a lot of
undereducated people using the roads.

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No problem, once they have good incomes
Yeah, then they will Yes, yes, yes.

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[sil.]

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Yoweri Museveni fought against the
dictatorship of Idi Amin Dada

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during the 1970s. A student of Lenin,
Frantz Fanon, and Mao, he took power in

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1986 as the head of the
National Resistance Army.

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[music]

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[sil.]

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Museveni wins the first free Presidential
elections with 75% of the vote,

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but his authority is challenged by decedent
Ugandans in the north of the country.

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From bases in Sudan, they are destructing
the economy and defying the National Army.

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[sil.]

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The cost of equipping and maintaining
troops constantly increases.

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Independence and stability
have their price.

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[sil.]

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Kampala, Ministry of Finance, an urgent meeting for
the bank\'s British representative, Brian Faulkner.

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Very late.

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Oh, it\'s hard going through that water.
Isn\'t it, (inaudible)?

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[sil.]

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Sorry to be late.

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No, I got pooled up in this rain. You
are welcome, sir. Yeah. And I was…

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I\'m gonna see (inaudible). (inaudible) sort of lazy,
but rain, rain, rain. So how are you keeping?

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Very well. Thank you. How?

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Yeah, anyway, I, uh… I only make the
point to you Minister that, umm…

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donors will look and I am expressing
some views of donors here,

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not just of the World Bank, okay, we\'ll…
The bank helps coordinate bilateral aid,

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a role that gives it the right to demand information on
the internal and external policies of client nations.

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Various donors

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are obviously cognizant of the problems that
your country faces, uh… especially in the north,

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but I have urged the
Secretary of Defense, uh…

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in writing and I have also talked to your, uh…
former secretary, Secretary of the Treasury,

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to address two issues with the donors.
One is that

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is the level of defense expenditures and what
it is that you\'re that you see you are doing,

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okay? Because at the moment, nobody
is saying anything and everybody is

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drawing their own conclusions. The
second thing in that defense expenditure

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is the question of the demobilized soldiers

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and I think you have got a problem
in explaining to… to donors

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the fact that they have paid
for demobilization packages

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and some of these same people appear to be
back in the armed services. And I urge you

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to deal with those issues in some way,

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I am not telling you how to deal with it, but
somehow one needs to sit down with donors

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and to map out, okay? Okay. I am in a dilemma
because, one, I don\'t want the British, I mean,

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come and give us ammunition, you see. Give us
send us soldiers to do the fighting for us.

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I am I just want to make you aware
that there is starting to be some,

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uh… talk on the donors\' side, okay,

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and there is a need to get to the table, I don\'t
know whether it\'s the President who should do it,

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or whether it is Dr.
Obonyo, who should do it,

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but I am I am trying to sow the seed that we need
to, uh… address this issue. A budget meeting.

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The Minister of State for Defense is
demanding concessions from Mayanja-Nkangi

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that the International Community of Donors
oppose. If granted, these concessions

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risk jeopardizing the country\'s entire program of aid.
But Mister Chairman, I really must register my surprise

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at the attitude I find in this
meeting about the soldiers

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because you know forget the fighting,

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but their conditions of living now as you
know, there is a standard cabinet instruction

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that you handle their accommodation.
I have not come here

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to press you for it simply because I know

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the budget that is constraints we face.
But for the last 10 years

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we have been in power, our
soldiers live in shacks,

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they live like pigs,

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so for anyone really talk of parity,
and you talk of your secretaries

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and people like that, then we
are going to make the demand

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can I finish? Let me explain.
We shall demand.

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Now, before you made it clear further, I
don\'t want you to have the impression

00:17:40.000 --> 00:17:44.999
that we don\'t understand the difficult
conditions that our soldiers (inaudible), we do.

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I don\'t want you to go with that impression
because you said they are living like pigs,

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we don\'t care, we do. What I am saying is
this, that given difficult (inaudible),

00:17:55.000 --> 00:17:59.999
that\'s what I am saying. I was telling
you Mister Minister of Finance,

00:18:00.000 --> 00:18:04.999
that we in Defense share your…

00:18:05.000 --> 00:18:09.999
your difficulties in managing
these limited resources

00:18:10.000 --> 00:18:14.999
and that\'s why we have sacrificed to
the extent we have up to this moment

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by accepting that fact.

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We have not been unreasonable.

00:18:25.000 --> 00:18:33.000
[sil.]

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In the north of the country, rebels kidnap,

00:19:00.000 --> 00:19:04.999
steal and kill.

00:19:05.000 --> 00:19:13.000
[sil.]

00:19:20.000 --> 00:19:24.999
I think you want me to discuss

00:19:25.000 --> 00:19:29.999
the budget of Defense, I
think that\'s what they had.

00:19:30.000 --> 00:19:34.999
Last May, we, uh… gathered
together to discuss

00:19:35.000 --> 00:19:39.999
the question of Defense
and defense expenditures.

00:19:40.000 --> 00:19:44.999
I think that process of
consultation was extremely useful

00:19:45.000 --> 00:19:49.999
and that is why we have asked today

00:19:50.000 --> 00:19:54.999
to really continue that
dialogue because I think that

00:19:55.000 --> 00:19:59.999
what we are facing at
the moment is a danger

00:20:00.000 --> 00:20:04.999
of the program, the macroeconomic
program going off course

00:20:05.000 --> 00:20:09.999
and that would be extremely damaging
to a number of the initiatives

00:20:10.000 --> 00:20:14.999
that we all hope will be there
in the development budget.

00:20:15.000 --> 00:20:19.999
For instance, one very dear to
your heart is the roads program.

00:20:20.000 --> 00:20:24.999
Now, I don\'t intend to pursue that,
but let me just make the point

00:20:25.000 --> 00:20:29.999
that transparency exists in all
other parts of the budget,

00:20:30.000 --> 00:20:34.999
but it doesn\'t really exist in the
defense expenditure. Let\'s be flexible

00:20:35.000 --> 00:20:39.999
because the growth here is
because of solving some of the

00:20:40.000 --> 00:20:44.999
old problems of Uganda. The old
problems, we had criminals

00:20:45.000 --> 00:20:49.999
who had usurped power, we defeated them in the
battlefield, recently we defeated them in the elections.

00:20:50.000 --> 00:20:54.999
They are coming through Sudan
and we cannot allow this.

00:20:55.000 --> 00:20:59.999
We are not going to allow Uganda
would never be like Cambodia

00:21:00.000 --> 00:21:04.999
or Somalia or any to be arrested by
international forces after so much chaos

00:21:05.000 --> 00:21:09.999
and it will never happen.
So, please, I would like to

00:21:10.000 --> 00:21:14.999
beg your intelligence to understand
that we are with a historical situation

00:21:15.000 --> 00:21:19.999
to deal with. I do not have any cripple

00:21:20.000 --> 00:21:24.999
with you Mister President about the need
to have flexibility in the budget, okay?

00:21:25.000 --> 00:21:29.999
My concern is that if you
keep squeezing the areas

00:21:30.000 --> 00:21:34.999
of the of the true development items, okay,

00:21:35.000 --> 00:21:39.999
it is not going to be good for the development
of the country. Much of our budget was last year

00:21:40.000 --> 00:21:44.999
as you as you see in this, and it
was not much, 17 million dollars,

00:21:45.000 --> 00:21:49.999
I wish you could ask your
you come from Britain,

00:21:50.000 --> 00:21:54.999
I wish you could ask your minister how
much it spends on defending Britain,

00:21:55.000 --> 00:21:59.999
which is already very defended as an island,
surrounded by a very big trench of water,

00:22:00.000 --> 00:22:04.999
but it spends quite a lot of money.
(inaudible) a bit serious.

00:22:05.000 --> 00:22:09.999
17 million dollars is nothing. So I don\'t think
we should be so much excited about defense,

00:22:10.000 --> 00:22:14.999
defense, defense, it\'s not realistic.

00:22:15.000 --> 00:22:23.000
[sil.]

00:22:35.000 --> 00:22:39.999
Oh, would you? Okay.

00:22:40.000 --> 00:22:44.999
When, uh… Yeah, I give you… I
give you my apologies in advance

00:22:45.000 --> 00:22:49.999
with (inaudible) because I am
holding talks with (inaudible).

00:22:50.000 --> 00:22:55.000
What are the opportunities?
Ah, well (inaudible).

00:23:05.000 --> 00:23:09.999
Brian Faulkner and representatives of the donor
countries increase the pressure for more information

00:23:10.000 --> 00:23:14.999
on the defense budget.

00:23:15.000 --> 00:23:19.999
Every time I come to talk, I seem to
put the same record back on, okay,

00:23:20.000 --> 00:23:24.999
and I don\'t I don\'t really
I don\'t get an answer,

00:23:25.000 --> 00:23:29.999
I am sort of playing the music to myself.
When we go to the CG meeting,

00:23:30.000 --> 00:23:34.999
in Paris, we have to make a judgment

00:23:35.000 --> 00:23:39.999
on the government\'s public expenditure.

00:23:40.000 --> 00:23:44.999
Sorry?

00:23:45.000 --> 00:23:49.999
(inaudible) the difference in parliament,

00:23:50.000 --> 00:23:54.999
but World Bank doesn\'t seem to be.

00:23:55.000 --> 00:23:59.999
The level of items

00:24:00.000 --> 00:24:04.999
in the budget, the quality of the budget

00:24:05.000 --> 00:24:09.999
is what is the question, okay?
Security is a very large item,

00:24:10.000 --> 00:24:14.999
okay, and I have acknowledged
time and time again

00:24:15.000 --> 00:24:19.999
that it is not what is
in the defense budget,

00:24:20.000 --> 00:24:24.999
it is the ratio or the
proportion of defense

00:24:25.000 --> 00:24:29.999
which is in the budget, which is the problem. What you
need to look at is what the minister was giving you,

00:24:30.000 --> 00:24:34.999
the last column, the total
expenditure, the percentage.

00:24:35.000 --> 00:24:39.999
The defense expenditure\'s
percentage of total expenditure,

00:24:40.000 --> 00:24:44.999
because you see, to move from 58 to 72

00:24:45.000 --> 00:24:49.999
does not necessarily mark, is it the
whole budget that keeps going up?

00:24:50.000 --> 00:24:54.999
In the course of this discussion,
you have told us that in fact

00:24:55.000 --> 00:24:59.999
the UPDA has acquired tanks in
the course of the last year.

00:25:00.000 --> 00:25:04.999
This is the first information as far as I
know to that effect and these tanks were not

00:25:05.000 --> 00:25:09.999
I think forecast in last year\'s discussion.
And you will understand

00:25:10.000 --> 00:25:14.999
if we display an obsession with the
size of the total budget and the impact

00:25:15.000 --> 00:25:19.999
of the defense budget on it
because we do contribute to it,

00:25:20.000 --> 00:25:24.999
we don\'t contribute to the defense
budget, but if we don\'t ask about it,

00:25:25.000 --> 00:25:29.999
things in which we have a direct interest
suffer and our interests suffer too.

00:25:30.000 --> 00:25:34.999
So there is a very genuine concern

00:25:35.000 --> 00:25:39.999
that the program itself, if it continues
this way and we don\'t have the dialogue,

00:25:40.000 --> 00:25:44.999
is not going to be supportable
from the donor community.

00:25:45.000 --> 00:25:49.999
I think what remains now for me

00:25:50.000 --> 00:25:54.999
is to say thank you to everybody
and the Minister for coming

00:25:55.000 --> 00:25:59.999
and for the explanations you have given,
but I want to ask the question who are you

00:26:00.000 --> 00:26:04.999
on the this side of the chair the table?
You are our friends,

00:26:05.000 --> 00:26:09.999
Mr. Faulkner, I say so.

00:26:10.000 --> 00:26:14.999
Uganda takes last analysis.
Its own decisions.

00:26:15.000 --> 00:26:23.000
[sil.]

00:27:00.000 --> 00:27:04.999
This is Jim Adams.

00:27:05.000 --> 00:27:09.999
Hi Jim, nice to meet you. You
actually met a couple of times. Yeah.

00:27:10.000 --> 00:27:14.999
Lynda Chalker, Minister of State for Overseas Development
for Britain. I know we have lots of Jims in the office.

00:27:15.000 --> 00:27:19.999
Former colonial power, the world\'s
fourth largest supplier of arms,

00:27:20.000 --> 00:27:24.999
Britain has close relations with Uganda as it does with other members
of the Commonwealth. Jim and Brian(ph). Sit with your back to the wall.

00:27:25.000 --> 00:27:29.999
Right.

00:27:30.000 --> 00:27:34.999
It\'s Ugandan tea. I will tell you

00:27:35.000 --> 00:27:39.999
the funniest thing, yesterday down on the Stephanie\'s
farm (inaudible), I watched the boys breathe the teabags

00:27:40.000 --> 00:27:44.999
out of the packet, they
said Kenyan teabags.

00:27:45.000 --> 00:27:49.999
Yeah, I had to laugh. Well, I gave them
a good go over yesterday on money,

00:27:50.000 --> 00:27:54.999
yes. I wasn\'t very kind, I was really firm.

00:27:55.000 --> 00:27:59.999
It\'s nothing trying to be kind actually. Oh, just
leave, you have to be cruel to be kind in this so.

00:28:00.000 --> 00:28:04.999
But I think you got the other messages.
But he is absolutely adamant

00:28:05.000 --> 00:28:09.999
about security and he is

00:28:10.000 --> 00:28:14.999
particularly determined
to make these changes

00:28:15.000 --> 00:28:19.999
in the north and therefore concerned

00:28:20.000 --> 00:28:24.999
that we should understand

00:28:25.000 --> 00:28:29.999
what he is about. What I
don\'t think he knows is

00:28:30.000 --> 00:28:34.999
what\'s really happening to the
money within the military budget.

00:28:35.000 --> 00:28:39.999
So I could suggest to him yesterday
that he might appreciate

00:28:40.000 --> 00:28:44.999
just a little bit of help from some
friends to sort this out and whilst I

00:28:45.000 --> 00:28:49.999
offered our help, I think that help
would come best from you to be frank.

00:28:50.000 --> 00:28:54.999
Umm… But we could help you
with it and it to happen.

00:28:55.000 --> 00:28:59.999
To be fair, I think and I think you
have laid the issues out correctly.

00:29:00.000 --> 00:29:04.999
I mean security is a bigger problem now and obviously
he has a responsibility to deal with that,

00:29:05.000 --> 00:29:09.999
but I think what we simply have to press
is that clearly the additional money

00:29:10.000 --> 00:29:14.999
that was put in security last year didn\'t help and that
should be one message, that money is not the answer alone.

00:29:15.000 --> 00:29:19.999
He knows that, he knows that. I am sure he knows
that. He was very open about the army having failed

00:29:20.000 --> 00:29:24.999
in northern central areas. He
teased me somewhat about having

00:29:25.000 --> 00:29:29.999
had our behest, or the donor\'s
behest, having reduced

00:29:30.000 --> 00:29:34.999
the size of the army and now we got to increase
again because it but he the whole time he accepted

00:29:35.000 --> 00:29:39.999
that it was a lack of training in the army which
was the crucial problem. I am a little interested,

00:29:40.000 --> 00:29:44.999
I mean in terms of how he handled defense. You
know, except from my extents of experience

00:29:45.000 --> 00:29:49.999
as a cook in the United States
Army, at the technical level,

00:29:50.000 --> 00:29:54.999
this, I mean, I think the bank, the problem I
have on the bank\'s side is I think as an issue

00:29:55.000 --> 00:29:59.999
and as how it fits within the
macro, we are quite comfortable

00:30:00.000 --> 00:30:04.999
and we are quite prepared to talk and to talk about some of
the options. But what we will need, and this is your point,

00:30:05.000 --> 00:30:09.999
I mean that we will be careful about what other donor
is involved, is that we will need the protection

00:30:10.000 --> 00:30:14.999
of being able to say, look, there is this real
expertise and we want your professionals to deal

00:30:15.000 --> 00:30:19.999
with this expertise, not with the bank. And we
can handle the transparency in the overall,

00:30:20.000 --> 00:30:24.999
but we are not going to bring we are not able to bring in people to
give them advice on what sort of equipment, what sort of training

00:30:25.000 --> 00:30:29.999
and that sort of things. Yeah, well,
that\'s why he really does need a

00:30:30.000 --> 00:30:34.999
good army budgeting man, who understands
equipments and army provision needs,

00:30:35.000 --> 00:30:39.999
but also understands the money side of it.
We can offer somebody who would help

00:30:40.000 --> 00:30:44.999
from the Nairobi office, uh…

00:30:45.000 --> 00:30:49.999
a Brit who is extremely good and wise,
but what I think what we need to

00:30:50.000 --> 00:30:54.999
do is to do this under the
auspices of the World Bank.

00:30:55.000 --> 00:30:59.999
So keep pushing.

00:31:00.000 --> 00:31:04.999
[sil.]

00:31:05.000 --> 00:31:09.999
Hello, welcome Mr. Adams. Thank you, nice to see
you again. How are you? Very well, thank you.

00:31:10.000 --> 00:31:14.999
Sorry to bring you here in the bush. No,
this is very nice. But this is where I live.

00:31:15.000 --> 00:31:23.000
[sil.]

00:31:25.000 --> 00:31:29.999
What are the donors saying? Are they saying
that the Europeans were wrong to fight Hitler?

00:31:30.000 --> 00:31:34.999
And that as long as they were fighting
Hitler, they should not get resources?

00:31:35.000 --> 00:31:39.999
I think at that time, they needed
resources when they were fighting Hitler

00:31:40.000 --> 00:31:44.999
because Hitler was a danger to the human
race. So what are they saying now?

00:31:45.000 --> 00:31:49.999
What are the donors saying? That
it\'s bad to fight Idi Amin?

00:31:50.000 --> 00:31:54.999
We should have left Idi Amin (inaudible) the whole country? What
are they saying exactly? The first issue is simply making clear

00:31:55.000 --> 00:31:59.999
both the magnitude of the threat
and why the government feels

00:32:00.000 --> 00:32:04.999
this level of expenditures is important
and so one of the concerns I have

00:32:05.000 --> 00:32:09.999
is this question of how some of these decisions about
resource allocation can be brought to closure,

00:32:10.000 --> 00:32:14.999
in a way that both the
government is comfortable with

00:32:15.000 --> 00:32:19.999
and in a way that puts me in a position where I can make
the case across the donor community about sustaining

00:32:20.000 --> 00:32:24.999
the large donor support for Uganda.
Now, these donors

00:32:25.000 --> 00:32:29.999
surely know something about constitutional governance
on the one hand and law and order on the other hand.

00:32:30.000 --> 00:32:34.999
How would they how would it
work, without law and order,

00:32:35.000 --> 00:32:39.999
without constitutional governance?
(inaudible) constitutional governance,

00:32:40.000 --> 00:32:44.999
so defending the constitution fully,
any parliament would understand this.

00:32:45.000 --> 00:32:49.999
I don\'t see any parliament that would not
understand the need to defend their constitution.

00:32:50.000 --> 00:32:54.999
May I tell you just a little
bit of information. Yes.

00:32:55.000 --> 00:32:59.999
There are 30 mass graves in Luweero

00:33:00.000 --> 00:33:04.999
and each of the mass graves contains
more than two thousand skulls,

00:33:05.000 --> 00:33:09.999
so that is if you got about

00:33:10.000 --> 00:33:14.999
70,000 skulls in just
the Luweero area alone,

00:33:15.000 --> 00:33:19.999
this is (inaudible). These are the groups

00:33:20.000 --> 00:33:24.999
we are fighting now, the ones who are killing people in the whole
country, in other words, who are killing people in one corner

00:33:25.000 --> 00:33:29.999
of our country.

00:33:30.000 --> 00:33:34.999
And you are saying that we shouldn\'t spend
money to wipe these people out? If you say

00:33:35.000 --> 00:33:39.999
there are more efficient ways of doing it, okay,
we can look at those. That\'s the good argument

00:33:40.000 --> 00:33:44.999
I really would listen to, but to say
that that is illegitimate expenditure,

00:33:45.000 --> 00:33:49.999
it is a wrong expenditure, it
is squandering of resources,

00:33:50.000 --> 00:33:54.999
it is really not correct.

00:33:55.000 --> 00:33:59.999
[sil.]

00:34:00.000 --> 00:34:04.999
My frustration is at the basic level,

00:34:05.000 --> 00:34:09.999
I accept that if they come and say, look, we are going
to spend an extra 10 million dollars this year,

00:34:10.000 --> 00:34:14.999
this is what we are going to do,
efficiently and intelligently,

00:34:15.000 --> 00:34:19.999
that\'s something we can take and we
can present as a sensible position.

00:34:20.000 --> 00:34:24.999
What I am worried is I see the system hemorrhaging
and when I see when Museveni had said is

00:34:25.000 --> 00:34:29.999
let\'s build housing, let\'s make sure the
soldiers are well taken care of, you know,

00:34:30.000 --> 00:34:34.999
that\'s not a credible story.
So it has been (inaudible)

00:34:35.000 --> 00:34:39.999
and you have got the, you know,

00:34:40.000 --> 00:34:44.999
you almost (inaudible) and
of course, the (inaudible)

00:34:45.000 --> 00:34:49.999
where is all the money going, okay, why
you what are you going to do about them,

00:34:50.000 --> 00:34:54.999
but then you got the doubts
on the other (inaudible),

00:34:55.000 --> 00:34:59.999
okay, so but you know,

00:35:00.000 --> 00:35:04.999
I think that you have to
(inaudible) Minister of Finance,

00:35:05.000 --> 00:35:09.999
because it… it isn\'t going to go away.

00:35:10.000 --> 00:35:14.999
The function of all banks is to facilitate
loans and to assure the conditions

00:35:15.000 --> 00:35:19.999
that enable them to do so. The bank
finally agrees the Ugandan budget,

00:35:20.000 --> 00:35:24.999
defense expenditure included.

00:35:25.000 --> 00:35:29.999
The bank applies

00:35:30.000 --> 00:35:34.999
own theories of development. Countries are
prepared for the new world economic order,

00:35:35.000 --> 00:35:39.999
where the laws of the market are assumed
to be efficient and beneficial for all,

00:35:40.000 --> 00:35:44.999
but development loans have created a paradox which cause
them to question the banks for their existence, debt.

00:35:45.000 --> 00:35:49.999
For developing countries,

00:35:50.000 --> 00:35:54.999
debt amounts to millions upon millions of dollars. It is a
burden that undermines the growth of fragile economies.

00:35:55.000 --> 00:36:03.000
[sil.]

00:36:20.000 --> 00:36:24.999
James Wolfensohn makes his first visit to
Africa as President of the World Bank.

00:36:25.000 --> 00:36:29.999
He has come in person to give important
news to the Ugandans who greet him.

00:36:30.000 --> 00:36:34.999
The bank is studying a plan
to reduce the burden of debt

00:36:35.000 --> 00:36:39.999
and Uganda with its impressive record of
growth, could benefit from the initiative.

00:36:40.000 --> 00:36:48.000
[sil.]

00:37:10.000 --> 00:37:14.999
I see the hope for money. Huh?

00:37:15.000 --> 00:37:19.999
It\'s the hope for money. Yes,
it\'s the hope for money.

00:37:20.000 --> 00:37:24.999
Because if we tell them (inaudible)
President of the World Bank.

00:37:25.000 --> 00:37:29.999
Now, the business of one of the small
branches may be commercial park. (inaudible).

00:37:30.000 --> 00:37:38.000
[sil.]

00:37:40.000 --> 00:37:44.999
Please don\'t say that. Anything but that.
(inaudible) you think

00:37:45.000 --> 00:37:49.999
I have just come out of the banking group.

00:37:50.000 --> 00:37:58.000
[sil.]

00:38:05.000 --> 00:38:09.999
Please allow us to present this small gift.

00:38:10.000 --> 00:38:18.000
[music]

00:38:30.000 --> 00:38:34.999
We are now saints, not even the World Bank,

00:38:35.000 --> 00:38:39.999
well, no, I feel I am a saint at the bank.
And so does, so does Brian.

00:38:40.000 --> 00:38:44.999
And so do a lot of those, Kim probably is.
But the fact is

00:38:45.000 --> 00:38:49.999
that there is a need to make sure
that both sides are malleable

00:38:50.000 --> 00:38:54.999
and ready for this new engagement.

00:38:55.000 --> 00:38:59.999
I don\'t doubt that when there is an
adjustment process, I don\'t doubt it at all

00:39:00.000 --> 00:39:04.999
that an adjustment process
hurts some and helps others,

00:39:05.000 --> 00:39:09.999
that\'s the nature of adjustment. But
you cannot compete internationally

00:39:10.000 --> 00:39:14.999
and you cannot develop your society unless you
have some framework within which you can work.

00:39:15.000 --> 00:39:19.999
Now you can say that our
policies are wrong,

00:39:20.000 --> 00:39:24.999
you can say that some structural
adjustment program is not correct.

00:39:25.000 --> 00:39:29.999
But the notion the simplistic notion,
that all structural adjustment is wrong,

00:39:30.000 --> 00:39:34.999
we could sit here and
have a seminar over it.

00:39:35.000 --> 00:39:39.999
I have to tell you that there are some examples
of structural adjustment which worked.

00:39:40.000 --> 00:39:44.999
Now that may be too big a mindset to get out of your heads
in five minutes, but give it a minute\'s thought sometime.

00:39:45.000 --> 00:39:49.999
Structural adjustment,

00:39:50.000 --> 00:39:54.999
a key component in the policies of the World
Bank and International Monetary Fund.

00:39:55.000 --> 00:39:59.999
Governments are obliged to promote
austerity, reduction of public spending

00:40:00.000 --> 00:40:04.999
and the prioritizing of exports. In short, the restructuring
of national economies in favor of private enterprise.

00:40:05.000 --> 00:40:09.999
[sil.]

00:40:10.000 --> 00:40:14.999
This evening, James Wolfensohn

00:40:15.000 --> 00:40:19.999
meets with Minister Mayanja-Nkangi and the
Secretary to the Treasury, Emmanuel Tumusiime,

00:40:20.000 --> 00:40:24.999
once a Maoist student leader. I am not a
bank man as you know, but I have the feeling

00:40:25.000 --> 00:40:29.999
that there is lot of pressure on bank staff

00:40:30.000 --> 00:40:34.999
to create, umm…

00:40:35.000 --> 00:40:39.999
conditions for projects, but
if you are having a country

00:40:40.000 --> 00:40:44.999
which has reached an advanced stage of removing
the constraints to projects and so forth,

00:40:45.000 --> 00:40:49.999
isn\'t it a small (inaudible),

00:40:50.000 --> 00:40:54.999
but I suspect that staff are promoted

00:40:55.000 --> 00:40:59.999
on the basis of what they have been able to force
governments to do and that\'s not very healthy.

00:41:00.000 --> 00:41:04.999
But if that is true, it will change.
I hope to God it\'s not true.

00:41:05.000 --> 00:41:09.999
If you had said to me,
they… they are promoted

00:41:10.000 --> 00:41:14.999
on the basis of the number of projects they
put out, that is a criticism I have heard,

00:41:15.000 --> 00:41:19.999
so I hope that if you are right, that
they are rewarded much like policemen are

00:41:20.000 --> 00:41:24.999
for the number of tickets they give out, and in your case,
you are suggesting the number of conditions they get on,

00:41:25.000 --> 00:41:29.999
I can give you a category promise that that
will change. I hope it\'s not true now,

00:41:30.000 --> 00:41:34.999
that but it will change.
Now, I think a year ago,

00:41:35.000 --> 00:41:39.999
our debt multilateral was about 2.6, 2.9,

00:41:40.000 --> 00:41:44.999
it\'s now about 3 billion I
think (inaudible) dollars,

00:41:45.000 --> 00:41:49.999
but most of it… Yes, multilateral.

00:41:50.000 --> 00:41:54.999
And the multilaterals by their definition
was they don\'t (inaudible) as whatever.

00:41:55.000 --> 00:41:59.999
So the charter as far as I know

00:42:00.000 --> 00:42:04.999
makes that necessary. Is there
anything you can do, however,

00:42:05.000 --> 00:42:09.999
so that we don\'t have, for instance,

00:42:10.000 --> 00:42:14.999
in a year to pay back an interest on the 20 million
dollars, being a million, yes, about that, sometimes 200,

00:42:15.000 --> 00:42:19.999
now that 200 million figure, would that

00:42:20.000 --> 00:42:24.999
Is critically important.
Because the issue of debt is,

00:42:25.000 --> 00:42:29.999
if not the first, it was the
second issue I tackled in the bank

00:42:30.000 --> 00:42:34.999
because the debt issue is something that, first
of all I want to take the initiative on.

00:42:35.000 --> 00:42:39.999
But I recognized that it is an
issue of debate and of concern

00:42:40.000 --> 00:42:44.999
for many developing countries

00:42:45.000 --> 00:42:49.999
and I recognize it\'s an
issue of concern here,

00:42:50.000 --> 00:42:54.999
but I will deal with it and I will come
back with yes, no, or maybe. Okay, but

00:42:55.000 --> 00:42:59.999
But at least you know.

00:43:00.000 --> 00:43:08.000
[sil.]

00:43:20.000 --> 00:43:24.999
I am going to put on my jacket, I
just hope I am not late, okay?

00:43:25.000 --> 00:43:29.999
No, 12:30. Yeah, 12:30.

00:43:30.000 --> 00:43:34.999
So okay.

00:43:35.000 --> 00:43:39.999
In Uganda, you know, they are very
interested in this debt stuff.

00:43:40.000 --> 00:43:44.999
They want to make sure they are
properly handled from that perspective.

00:43:45.000 --> 00:43:49.999
You know what I mean? Tumusiime who is,
you know, very solid on these things,

00:43:50.000 --> 00:43:54.999
essentially is not sure we have given him the straight
story. Why is it that Uganda is not on the list,

00:43:55.000 --> 00:43:59.999
Zambia and Cameroon (inaudible),

00:44:00.000 --> 00:44:04.999
they should be on the list. What the Fund
says, is given a certain set of assumptions,

00:44:05.000 --> 00:44:09.999
Uganda is sustainable but very fragile and
then goes into the fragile discussion

00:44:10.000 --> 00:44:14.999
and that\'s what their
analysis says right now.

00:44:15.000 --> 00:44:19.999
Whereas it has always been on our list, it is not
included in the same prominence on their list

00:44:20.000 --> 00:44:24.999
and so when this joint paper was
done, it was not included in

00:44:25.000 --> 00:44:29.999
what I would call the basket cases. Are you
okay that you can\'t have this 7% growth

00:44:30.000 --> 00:44:34.999
and be complaining about
40-year money, 10-year grace,

00:44:35.000 --> 00:44:39.999
0.75-1% interest, that you can\'t pay it and then what
the hell are we talking about? That\'s the point.

00:44:40.000 --> 00:44:44.999
You can\'t afford to have it,
what can you afford? Nothing.

00:44:45.000 --> 00:44:49.999
But, I explained to you the story that in our
projections, our guys were solving this problem

00:44:50.000 --> 00:44:54.999
By low growth. By low growth and I
kept saying thank you very much,

00:44:55.000 --> 00:44:59.999
this is not a deal I am interested in signing in on, and
I said now I am not interested in signing off on it,

00:45:00.000 --> 00:45:04.999
but the last thing I am going to do is,
say, you know, this very successful Uganda

00:45:05.000 --> 00:45:09.999
in order to sustain it, we
are going to take 6% growth

00:45:10.000 --> 00:45:14.999
and we are going to ratchet it down to
2.8%, thank you very much. And how can we,

00:45:15.000 --> 00:45:19.999
I mean what the hell are we talking about? Why
can\'t they afford more debt, more imports,

00:45:20.000 --> 00:45:24.999
if they get their growth of exports, like that? Of
course, they can. So this is a big issue. Okay.

00:45:25.000 --> 00:45:29.999
The state of knowledge is not
what I am talking about,

00:45:30.000 --> 00:45:34.999
it\'s the state of behavior to hold on to it. Am I
supposed to cry here? Am I supposed to cry here?

00:45:35.000 --> 00:45:39.999
No, no.

00:45:40.000 --> 00:45:44.999
[sil.]

00:45:45.000 --> 00:45:49.999
(inaudible), Egyptian-born economist appointed by
James Wolfensohn to lead the team that will define

00:45:50.000 --> 00:45:54.999
the terms of the debt initiative. Yes,
hello. Can I talk to Sina, please?

00:45:55.000 --> 00:45:59.999
Okay. Can you find out whether Mr.
Masood called a moment ago?

00:46:00.000 --> 00:46:04.999
Yeah, tell him I am with Jim Adams.

00:46:05.000 --> 00:46:09.999
Umm… Okay, umm… We have had this
peculiar interaction with the Fund

00:46:10.000 --> 00:46:14.999
and you know the Fund is so good at making
sure everybody is lined up in a row,

00:46:15.000 --> 00:46:19.999
I think it\'s important On this one, given that
it\'s early days that we line up similarly.

00:46:20.000 --> 00:46:24.999
Umm… Essentially, what message we have back
from the Fund is why is all this work happening

00:46:25.000 --> 00:46:29.999
and I just want your advice on how
we manage that, I mean we are not

00:46:30.000 --> 00:46:34.999
we want to do it right, so we
are looking for your advice

00:46:35.000 --> 00:46:39.999
and your guidance. Maybe I can exchange
with you from our more narrow,

00:46:40.000 --> 00:46:44.999
maybe, perspective of work with the Fund,
how did we perceive the vibes on Uganda.

00:46:45.000 --> 00:46:49.999
The Fund\'s attitude

00:46:50.000 --> 00:46:54.999
is that they have already committed to a set
of numbers and they actually told me bluntly

00:46:55.000 --> 00:46:59.999
that that would create for them a problem if they
were to come back with a very different number.

00:47:00.000 --> 00:47:04.999
Their position is being that if policies
are okay, that is manageable, period.

00:47:05.000 --> 00:47:09.999
Yes, that\'s right. Umm… I was at the
meeting at the board meeting with yeah.

00:47:10.000 --> 00:47:14.999
But David that was before the
debt initiative, stop this,

00:47:15.000 --> 00:47:19.999
you are falling into their trap. We want a set of agreements
consistent with the debt initiative. Yes. And for them to say,

00:47:20.000 --> 00:47:24.999
no, that\'s coming in the future is not going to be cleared by
us. Very well. And this when is this going to be released?

00:47:25.000 --> 00:47:29.999
This we are fighting with them on many
other things and we stopped it so, but

00:47:30.000 --> 00:47:34.999
Good, I know exactly what I have to do, we
are fine. You take a photocopy of this.

00:47:35.000 --> 00:47:39.999
What? The amount will depend
on their projections?

00:47:40.000 --> 00:47:44.999
(inaudible). You give me an
expert growth that provides

00:47:45.000 --> 00:47:49.999
a level of that that is in
excess of the sustainable level,

00:47:50.000 --> 00:47:54.999
I take it away from Uganda\'s book
and pay for it. It\'s grant money,

00:47:55.000 --> 00:47:59.999
dollar for dollar for Uganda.
It\'s no longer numbness.

00:48:00.000 --> 00:48:04.999
[sil.]

00:48:05.000 --> 00:48:09.999
Jim, hi, how are you?

00:48:10.000 --> 00:48:14.999
No. Umm… how are things?

00:48:15.000 --> 00:48:19.999
They are not too bad, I mean there\'s two
big issues, but I mean I can discuss those

00:48:20.000 --> 00:48:24.999
with you when I see you next week,
one is the financial sector,

00:48:25.000 --> 00:48:29.999
that\'s still going on. Umm… I had a I went
to see the minister this afternoon because,

00:48:30.000 --> 00:48:34.999
maybe, you know, because
he will by July the 2nd,

00:48:35.000 --> 00:48:39.999
it\'s quite likely the new
ministers will be announced

00:48:40.000 --> 00:48:44.999
and yeah, and he may or may not be and as we
have worked together for more than three years,

00:48:45.000 --> 00:48:49.999
I thought I would, not of saying goodbye to him, but at least
I thought I would just go along and have a chat with him

00:48:50.000 --> 00:48:55.000
and also try and push him into on some of
these urgent issues, at least by the face.

00:49:45.000 --> 00:49:50.000
[sil.]

00:50:05.000 --> 00:50:09.999
After the presidential elections,

00:50:10.000 --> 00:50:14.999
it\'s now the turn of the parliamentarians.
Mayanja-Nkangi is campaigning for the seat

00:50:15.000 --> 00:50:19.999
on which his job depends.
Whatever the composition

00:50:20.000 --> 00:50:24.999
of the government, the World Bank
maintains its program of adjustments,

00:50:25.000 --> 00:50:29.999
starting with UCB, the Uganda Commercial
Bank. On paper, it is insolvent

00:50:30.000 --> 00:50:34.999
and is losing one million dollars a week. For the
World Bank, it is a typical public sector problem.

00:50:35.000 --> 00:50:39.999
[sil.]

00:50:40.000 --> 00:50:44.999
UCB must be sold off. The classic solution

00:50:45.000 --> 00:50:49.999
to be demanded of the government. Kim
Jaycox and Jim Adams arrive from Washington

00:50:50.000 --> 00:50:54.999
to confront President Museveni with a problem
that has a sensitive political dimension.

00:50:55.000 --> 00:51:03.000
[sil.]

00:51:05.000 --> 00:51:09.999
First of all,

00:51:10.000 --> 00:51:14.999
the refusal to give files to this trust,

00:51:15.000 --> 00:51:19.999
which was supposed to arrest
these people who took money,

00:51:20.000 --> 00:51:24.999
who didn\'t pay it. Or get the
payment, get the repayment.

00:51:25.000 --> 00:51:29.999
So what\'s the problem? Why are
they refusing to give the files?

00:51:30.000 --> 00:51:34.999
Yes, this matter has been raised with
you several times, except that only

00:51:35.000 --> 00:51:39.999
today that we gave them the final
instruction because we had hoped

00:51:40.000 --> 00:51:44.999
that in the discussions with (inaudible).
No, no, sir, I wrote a long letter,

00:51:45.000 --> 00:51:49.999
I wrote a long letter to the managing director about
a month ago. (inaudible) to accept as a coincidence.

00:51:50.000 --> 00:51:54.999
They were the ones.

00:51:55.000 --> 00:51:59.999
We are talking about the hundred
largest debtors and I am sure

00:52:00.000 --> 00:52:04.999
there are important people in Uganda. But who are
those? What sort of people are they, can I have a look?

00:52:05.000 --> 00:52:09.999
[sil.]

00:52:10.000 --> 00:52:14.999
Now, these are all bad people,

00:52:15.000 --> 00:52:19.999
are they not?

00:52:20.000 --> 00:52:24.999
I think these ones should not be forgiven. This
should This is what they call insider work, you know.

00:52:25.000 --> 00:52:29.999
Yes, yes, because these are the real
problems. And this is the state on the asset

00:52:30.000 --> 00:52:34.999
they are working on. Yes, yes, ,

00:52:35.000 --> 00:52:39.999
it\'s a free gadget. Yes, actually.
It\'s in preparation for

00:52:40.000 --> 00:52:44.999
the bona fides privatization of this asset.

00:52:45.000 --> 00:52:49.999
Get it operating so that you know it does
its service to the hardworking community,

00:52:50.000 --> 00:52:54.999
the farmer, the industry or whatever.

00:52:55.000 --> 00:52:59.999
Because I think that without
that discipline, you are going

00:53:00.000 --> 00:53:04.999
to have a, you have a real bad situation on the bank
at the bank. No, we are not going to allow this.

00:53:05.000 --> 00:53:09.999
So let\'s privatize it. And it will
be the (inaudible) to struggle

00:53:10.000 --> 00:53:14.999
the overhead costs, still all this no,

00:53:15.000 --> 00:53:19.999
I think the minister has showed us enough.

00:53:20.000 --> 00:53:24.999
Yeah, yeah, I am satisfied. His enthusiasm
is quite excited with your arrival.

00:53:25.000 --> 00:53:29.999
So that\'s not a problem for us. For us,

00:53:30.000 --> 00:53:34.999
we ask for the results, not the means.

00:53:35.000 --> 00:53:39.999
[sil.]

00:53:40.000 --> 00:53:44.999
Hi, how you are doing?

00:53:45.000 --> 00:53:49.999
How you are doing? Hello, how you are
doing? Pakistan-born Irfan Aleem

00:53:50.000 --> 00:53:54.999
is a task manager, one of the specialists
that the bank sends out from Washington

00:53:55.000 --> 00:53:59.999
to supervise its projects and programs.
How are you Mr. Faulkner?

00:54:00.000 --> 00:54:04.999
This time, Aleem must put
in place the sale of UCB.

00:54:05.000 --> 00:54:09.999
He has to navigate between the
demands of the Monetary Fund

00:54:10.000 --> 00:54:14.999
and the World Bank, diplomatic necessities with political
implications. They are very serious about the privatization.

00:54:15.000 --> 00:54:19.999
So I think that you know your mission

00:54:20.000 --> 00:54:24.999
at this point in time is very important. I mean we have got
to get through the hurdles of the, like, financial sector

00:54:25.000 --> 00:54:29.999
update this afternoon and you know there will
be bullets all over the place, no doubt,

00:54:30.000 --> 00:54:34.999
umm… you know I think that you may
have to live with some of the

00:54:35.000 --> 00:54:39.999
previous sorters of the bank to deal with the UCB problem
in the same way as you were talking on Tanzania,

00:54:40.000 --> 00:54:44.999
it didn\'t work initially. Okay.

00:54:45.000 --> 00:54:49.999
And there is a, umm… possibly

00:54:50.000 --> 00:54:54.999
a doubt that the advice is always,
you know, the correct advice, okay?

00:54:55.000 --> 00:54:59.999
But we have been open about it, you know, we have made a
- Yeah, sometimes we haven\'t, but you know, I think that

00:55:00.000 --> 00:55:04.999
we have a difficult meeting coming ahead, but you are
right, we should be we certainly should be relaxed,

00:55:05.000 --> 00:55:09.999
not defensive and you should just try
and answer their particular concerns,

00:55:10.000 --> 00:55:14.999
okay, and then see where it is like we go to from there,
because we are all working in the same direction,

00:55:15.000 --> 00:55:19.999
even if we have our little
arguments and sort as we go along.

00:55:20.000 --> 00:55:24.999
The World Bank has commissioned
from some of its many consultants

00:55:25.000 --> 00:55:29.999
a report on Uganda\'s financial sector.

00:55:30.000 --> 00:55:34.999
The main (inaudible) of this
report of looming banking crisis

00:55:35.000 --> 00:55:39.999
must be changed. There is certainly

00:55:40.000 --> 00:55:44.999
no looming banking crisis anymore.
I don\'t think

00:55:45.000 --> 00:55:49.999
we have we have said the situation is fragile fragile
No, you said looming. Where? In their statistics.

00:55:50.000 --> 00:55:54.999
Okay, we are welcome to change it.

00:55:55.000 --> 00:55:59.999
This is in the summary of volume 1?

00:56:00.000 --> 00:56:04.999
It\'s paragraph 36.

00:56:05.000 --> 00:56:09.999
[sil.]

00:56:10.000 --> 00:56:14.999
Paragraph 36. Yeah, in summary, so
Uganda\'s financial sector reform

00:56:15.000 --> 00:56:19.999
strategy leads to tackle immediately pressing
difficulties such as the threat of bank collapse,

00:56:20.000 --> 00:56:24.999
the looming crisis of public
confidence in the banking system.

00:56:25.000 --> 00:56:29.999
This is no longer the case. Benefits
of time, the effluxion of time,

00:56:30.000 --> 00:56:34.999
I think it is inappropriate

00:56:35.000 --> 00:56:39.999
to characterize the problem that
used to be as lack of commitment

00:56:40.000 --> 00:56:44.999
to privatization.

00:56:45.000 --> 00:56:49.999
The President as you know, the
President has several times repeated

00:56:50.000 --> 00:56:54.999
the government\'s intention
to privatize UCB.

00:56:55.000 --> 00:56:59.999
Even when UCB management was being allowed

00:57:00.000 --> 00:57:04.999
the freedom to put their case to the public

00:57:05.000 --> 00:57:09.999
opposing privatization,

00:57:10.000 --> 00:57:14.999
the President was always making the
case, that the government itself

00:57:15.000 --> 00:57:19.999
was determined to privatize UCB.

00:57:20.000 --> 00:57:24.999
I think you are not appreciating

00:57:25.000 --> 00:57:29.999
the consensus building behind the clinical
reforms in Uganda. The government says,

00:57:30.000 --> 00:57:34.999
we are committed to do this,

00:57:35.000 --> 00:57:39.999
but it sometimes takes time to bring
everybody around the table in order

00:57:40.000 --> 00:57:44.999
to support the privatization,

00:57:45.000 --> 00:57:49.999
so please, government has never
failed to express its commitment

00:57:50.000 --> 00:57:54.999
to privatize UCB. Thankfully, you know,

00:57:55.000 --> 00:57:59.999
I am the most afraid of being hit

00:58:00.000 --> 00:58:04.999
on the head by people who
believe in the theory

00:58:05.000 --> 00:58:09.999
in spite of what the reality shows.

00:58:10.000 --> 00:58:14.999
[sil.]

00:58:15.000 --> 00:58:19.999
Robert Schauer, Division
Chief of East Africa

00:58:20.000 --> 00:58:24.999
with the International Monetary Fund. The Monetary
Fund and the World Bank together determine a country\'s

00:58:25.000 --> 00:58:29.999
lending program. But the functionaries of
the Fund have a reputation for applying

00:58:30.000 --> 00:58:34.999
their financial dogma with the rigor that makes
the officials of the bank appear easy going.

00:58:35.000 --> 00:58:39.999
[sil.]

00:58:40.000 --> 00:58:44.999
So it\'s the need to make resources available
for substantial increases in wages,

00:58:45.000 --> 00:58:49.999
defense, education, and all these
things, but it\'s quite big.

00:58:50.000 --> 00:58:54.999
One of the downsides of democracy

00:58:55.000 --> 00:58:59.999
is that is that politicians
make commitments

00:59:00.000 --> 00:59:04.999
the electorate and expect that those
direct commitments will be delivered,

00:59:05.000 --> 00:59:09.999
so that\'s what we are in

00:59:10.000 --> 00:59:14.999
and I don\'t think it\'s a very simple I don\'t think this
situation has a simple solution. I think this problem

00:59:15.000 --> 00:59:19.999
can be reduced to the
usual manageable domain,

00:59:20.000 --> 00:59:24.999
then it can be solved. We are just
meeting so I can clarify our position

00:59:25.000 --> 00:59:29.999
to make sure there is no understanding, or
misunderstanding. I want to make it very clear

00:59:30.000 --> 00:59:34.999
that my staff have no mandate to discuss
with you any numbers whatsoever.

00:59:35.000 --> 00:59:39.999
We have no we have never been
in this situation before.

00:59:40.000 --> 00:59:44.999
But I am afraid that\'s where we are.
And the situation is so serious

00:59:45.000 --> 00:59:49.999
that I cannot

00:59:50.000 --> 00:59:54.999
underestimate the gravity of the situation.
It\'s not for us to judge politics,

00:59:55.000 --> 00:59:59.999
but based on my experiences here in more
than four years, I am sure you will

01:00:00.000 --> 01:00:04.999
develop a viable budget framework
with the president who always has

01:00:05.000 --> 01:00:09.999
followed his principles on this and on a
relatively small point on this coffee tax,

01:00:10.000 --> 01:00:14.999
I think in view of the current price,

01:00:15.000 --> 01:00:19.999
it might be good idea to raise the threshold
further. They are voting for confidence.

01:00:20.000 --> 01:00:24.999
We have promised. Promised who.

01:00:25.000 --> 01:00:29.999
The people. First of all,

01:00:30.000 --> 01:00:34.999
as you know this was the government
initiative and at that time, you didn\'t…

01:00:35.000 --> 01:00:39.999
some of your people didn\'t think it was
a good idea. Which people were there?

01:00:40.000 --> 01:00:44.999
I thought I always thought I was very firm on this issue. Yeah For example.
Sorry. World Bank. Yeah, I mean… We are negotiating with the IMF Britain.

01:00:45.000 --> 01:00:49.999
Great Britain (inaudible). Yeah…
I think I was quite clear

01:00:50.000 --> 01:00:54.999
and firm on…

01:00:55.000 --> 01:00:59.999
I think I was quite clear on this… With longer decision. The fund
was always firmed in this view. I think there is a strong case

01:01:00.000 --> 01:01:04.999
for giving the right signal to the
investment in coffee industry

01:01:05.000 --> 01:01:09.999
and I think the existence of that tax

01:01:10.000 --> 01:01:14.999
is definitely acting as a
disincentive to investment in coffee.

01:01:15.000 --> 01:01:19.999
I must disagree with you very strongly
and we had meetings… extensive meetings

01:01:20.000 --> 01:01:24.999
with the coffees sectors, not about this issue which came
up peripherally but about projecting coffee volumes which,

01:01:25.000 --> 01:01:29.999
as you know, are very substantially higher. What you
are seeing is smuggling from neighboring countries.

01:01:30.000 --> 01:01:34.999
All the investments

01:01:35.000 --> 01:01:39.999
in coffee have not yet shown any provision.

01:01:40.000 --> 01:01:44.999
Why would they be in smuggling?
Most likely to bid here

01:01:45.000 --> 01:01:49.999
higher prices.

01:01:50.000 --> 01:01:54.999
Where would this coffee be coming from? Rwanda, Zaire.
There is little or no evidence of Rwandan coffee

01:01:55.000 --> 01:01:59.999
which is all the Arabica coming in. But, you know, you
should say you should be a bit humbler than that.

01:02:00.000 --> 01:02:04.999
Oh, yeah. I know that I am
looking I am here. Yes.

01:02:05.000 --> 01:02:09.999
I come from Cambodia where the coffee is
buzzing through the borders. So please.

01:02:10.000 --> 01:02:14.999
[sil.]

01:02:15.000 --> 01:02:19.999
I am tensed and I am upset.
I am very upset.

01:02:20.000 --> 01:02:24.999
Every time I am coming with an insurers over
here and he places unreasonable demands.

01:02:25.000 --> 01:02:29.999
Finally, I cannot get my foot in. Right. And I would
like to request that we sit with the (inaudible)

01:02:30.000 --> 01:02:34.999
and with the (inaudible) to say
this nonsense cannot go on.

01:02:35.000 --> 01:02:39.999
I cannot, you know, it\'s too much… We got to get
it balanced. Because whether we like it or not,

01:02:40.000 --> 01:02:44.999
the sister organizations and you know that,
okay, we had to look together, okay.

01:02:45.000 --> 01:02:49.999
They are concerned, they\'re very
concerned about the financial set up

01:02:50.000 --> 01:02:54.999
as you are and they want to be party

01:02:55.000 --> 01:02:59.999
to the discussions that are going on.
This is nonsense.

01:03:00.000 --> 01:03:04.999
If you can\'t go then you are putting pressure on me that I am to blame
for this thing. I am sorry. I can\'t carry out my responsibilities.

01:03:05.000 --> 01:03:09.999
I think it\'s totally unreasonable.
All right, is it?

01:03:10.000 --> 01:03:14.999
Yes, I have it. Okay. There are issues
which are very important to this country

01:03:15.000 --> 01:03:19.999
and I don\'t give us tinkers cusp
about personalities and that okay.

01:03:20.000 --> 01:03:24.999
I keep trying to get this across to
you, okay. I am not blaming you, okay.

01:03:25.000 --> 01:03:29.999
I am trying to make you aware that
we have to take these out of play.

01:03:30.000 --> 01:03:34.999
You are having a bad time. You\'re
being chased by the government

01:03:35.000 --> 01:03:39.999
on the agree and safety, you had a battering
there, okay. You\'re obviously had-

01:03:40.000 --> 01:03:44.999
No one stood up for me… no one. You are obviously
not in an emotional state to listen of then… okay.

01:03:45.000 --> 01:03:49.999
Just tell me what you would like me to do as the resurrect
okay and we will cut the conversation quickly, okay.

01:03:50.000 --> 01:03:54.999
We don\'t know anything about your
views, what are your thoughts are?

01:03:55.000 --> 01:03:59.999
What are your priorities? Absolutely zero. No, I have told that is not there.
Becoming here in the way… We have had several lengthy meetings with you as I had…

01:04:00.000 --> 01:04:04.999
let\'s all try better emotionally. Yeah. Not only
something up and also we clear this issue… you know…

01:04:05.000 --> 01:04:09.999
Yeah, that\'s true.. It\'s a more
a question of having… you know,

01:04:10.000 --> 01:04:14.999
we can\'t… we will be able to better understand. Oh,
absolutely. Because we have no restrictions on our end.

01:04:15.000 --> 01:04:19.999
We always send copies to all of you. Is that…
is that… Yeah, I think it would be very useful…

01:04:20.000 --> 01:04:24.999
Let\'s take it and that make a bigger effort
on it. Yeah, that\'s it… send more copies

01:04:25.000 --> 01:04:29.999
of all things that everybody has listed of the… Oh. Referring
on (inaudible). Thank you. Thank you, thank you very much.

01:04:30.000 --> 01:04:34.999
[sil.]

01:04:35.000 --> 01:04:39.999
Washington, September 1996.

01:04:40.000 --> 01:04:44.999
To justify debt in the eyes
of the donor community,

01:04:45.000 --> 01:04:49.999
the bank and the fund are looking for economic performance,
but not to the extent that you Uganda will be so successful

01:04:50.000 --> 01:04:54.999
that the country\'s need cannot be
justified. I know it is great optimism

01:04:55.000 --> 01:04:59.999
at the end of your back to office report
you had… it was… Uh… Also… also. You guys…

01:05:00.000 --> 01:05:04.999
you are under an instruction to say Gold!
Come on. Not so…

01:05:05.000 --> 01:05:09.999
we are where we are with the debt initiative
and I think if there is something going

01:05:10.000 --> 01:05:14.999
and we should insist you get in.
The fact is

01:05:15.000 --> 01:05:19.999
that their exports are doing very, very well and we have always been very,
very cautious in this area. And these … You say… And these… No… no… no.

01:05:20.000 --> 01:05:24.999
You… you don\'t want to start if I… If
I want to start it. Okay. I was here

01:05:25.000 --> 01:05:29.999
refusing being a bloody optimist.

01:05:30.000 --> 01:05:34.999
There is one for returning his… Two of his reports.
Instead tell me this is a modest directive

01:05:35.000 --> 01:05:39.999
that they still increase but the export side is they are
relative. Do one of the biggest files. So… let me finish.

01:05:40.000 --> 01:05:44.999
I am not saying that these are
wrong for use. I am saying that

01:05:45.000 --> 01:05:49.999
You know, we have to look at you more
careful from my side… My friend…

01:05:50.000 --> 01:05:54.999
I don\'t agree. No, no, let me finish… let me finish.
Wait, wait, wait right? But in… in the case of coffee

01:05:55.000 --> 01:05:59.999
that you are talking for example, I mean. I
if I follow, you will all raise from here,

01:06:00.000 --> 01:06:04.999
you will be producing our 4 million
bags in maybe three, four or five years

01:06:05.000 --> 01:06:09.999
at the most Which is something that
Uganda has never produced before.

01:06:10.000 --> 01:06:14.999
Whereas the exporters have told us we will be doing it in next Jan. We had… But wait. Let\'s not confuse
the projections… But just I want to ask you a question. Wait..wait..wait. Is it for a question.

01:06:15.000 --> 01:06:19.999
We are talking about actual first. No, no, no well actual
first. No, actual first. NO actual are actual. I was just…

01:06:20.000 --> 01:06:24.999
Projections we cannot bullshit. Actuals
are actuals. Actuals are actuals.

01:06:25.000 --> 01:06:29.999
Yes. Yeah, somebody… And it\'s turned
down much better than we thought.

01:06:30.000 --> 01:06:34.999
That\'s great! Let\'s be happy I should say
we should be happy. We are not happy.

01:06:35.000 --> 01:06:39.999
Okay. No some of us are not believing but buying. So, we have some pessimists. Yeah yeah. I
believe it says actual. No, no, we are… No, no, if we don\'t believe that coffee is important.

01:06:40.000 --> 01:06:44.999
If this is reservation I think
it\'s the thirst not to them.

01:06:45.000 --> 01:06:49.999
Yeah, yeah. To figure out what
could be done to either question,

01:06:50.000 --> 01:06:54.999
qualify or reinforce these numbers. So, there
are no more questions, if we have a suggestion,

01:06:55.000 --> 01:06:59.999
we have somebody who we can send out, who
can count the number of bags that is fair

01:07:00.000 --> 01:07:04.999
We have actually have friends… The Ugandans are fragile you
know, we are not etc etc. It will be true that you will call…

01:07:05.000 --> 01:07:09.999
We could be more cautious on the projections. I just
want to have… I want to have… I want to have a framework

01:07:10.000 --> 01:07:14.999
where we were both giving consistent messages. I
think then we go into the subsequent discussion,

01:07:15.000 --> 01:07:19.999
a lot more comfortable with what we are doing.
But they are preventing it. That\'s right

01:07:20.000 --> 01:07:24.999
and I look this. If… The 3.5
is right, the 3.5 percent goes

01:07:25.000 --> 01:07:29.999
and you are right You are just
going to get a lot less money,

01:07:30.000 --> 01:07:34.999
but the bottom line is that Ugandan doesn\'t need lot more money.
That\'s right. Okay, but look my point on this is not a problem

01:07:35.000 --> 01:07:39.999
between us at the country level.
Absolutely.

01:07:40.000 --> 01:07:44.999
Thank you… as always.

01:07:45.000 --> 01:07:53.000
[sil.]

01:08:30.000 --> 01:08:34.999
Back in Kampala, Allen must meet
with Uganda Monitoring Unit

01:08:35.000 --> 01:08:39.999
to prepare the ground for
privatization of UCB.

01:08:40.000 --> 01:08:44.999
You said you are going to have

01:08:45.000 --> 01:08:49.999
the final, not the unofficial copy of this report. I had
an official copy which went from Morgan Greenfield to us.

01:08:50.000 --> 01:08:54.999
This report, we\'ve received it. Okay. That I
understand from Morgan Greenfield that there has been

01:08:55.000 --> 01:08:59.999
a subsequent change that you requested.
Yeah. The minister felt that

01:09:00.000 --> 01:09:04.999
this section…

01:09:05.000 --> 01:09:09.999
section 6.3

01:09:10.000 --> 01:09:14.999
here dealing with the… Change in management.
Management yes. Should it be actually

01:09:15.000 --> 01:09:19.999
I had proposed that it should
be deleted from this report.

01:09:20.000 --> 01:09:24.999
So that he is given the permission to handle it separately with
the president who actually appoints the chairman obviously.

01:09:25.000 --> 01:09:29.999
Sure.

01:09:30.000 --> 01:09:34.999
When I told Morgan and they
instead of deleting it - Yes.

01:09:35.000 --> 01:09:39.999
They voted it down. You know that

01:09:40.000 --> 01:09:44.999
Morgan Greenfield told me that they had
received the request because of okay

01:09:45.000 --> 01:09:49.999
what is now the voted down version?

01:09:50.000 --> 01:09:54.999
This section had three paragraphs.

01:09:55.000 --> 01:09:59.999
Morgan Greenfield advises to the
government, paid for by Uganda,

01:10:00.000 --> 01:10:04.999
but with the mandate determined by the World Bank,
which must have proved the terms of the privatization.

01:10:05.000 --> 01:10:09.999
You need to… need to continue to extend
their contract You had one which is more…

01:10:10.000 --> 01:10:14.999
which is more critical as this one. Yeah. A change
at the head office which should also be considered,

01:10:15.000 --> 01:10:19.999
but the purpose of this would which
install a forceful figure was a mission

01:10:20.000 --> 01:10:24.999
would have been to privatize this would be
and who would take decisions with this goal

01:10:25.000 --> 01:10:29.999
as his foremost priority, deleted that one,

01:10:30.000 --> 01:10:34.999
deleted this whole section. Deleted that whole
paragraph. But, how feasible is it going to be

01:10:35.000 --> 01:10:39.999
for to move with Dr. Surma. That\'s
nothing, you… you have to move.

01:10:40.000 --> 01:10:44.999
If that\'s a prerogative if this…

01:10:45.000 --> 01:10:49.999
this is something that is very important. You
have to move. Mr. (inaudible) has to move him

01:10:50.000 --> 01:10:54.999
and push him… No… no… I don\'t have to move…

01:10:55.000 --> 01:10:59.999
I don\'t have to pull… That\'s why…

01:11:00.000 --> 01:11:04.999
that\'s why the minister is busy… is busy, you
know. Find an appropriate time to do so,

01:11:05.000 --> 01:11:09.999
but definitely he will. You don\'t have to do
so if this is a prerequisite, to be done.

01:11:10.000 --> 01:11:14.999
It took some time to remove the MD I think,

01:11:15.000 --> 01:11:19.999
but eventually it had to be done.
I mean if in fact the…

01:11:20.000 --> 01:11:24.999
but… the key condition required
to sell UCB are not being met,

01:11:25.000 --> 01:11:29.999
then this is just a gimmick and will
be seen as such and it will be…

01:11:30.000 --> 01:11:34.999
it reflects badly on everyone. I don\'t know
what I\'d advise, we ourselves can\'t give the…

01:11:35.000 --> 01:11:39.999
the central part except to say that

01:11:40.000 --> 01:11:44.999
I think Morgan Greenfield corporate team

01:11:45.000 --> 01:11:49.999
to the terms of the appointment.
UCB is not ours…

01:11:50.000 --> 01:11:54.999
this is not our job to sell it. Our job is as an advisor,
is to advise the government on how to sell it… Umm…

01:11:55.000 --> 01:11:59.999
And at the end of the day if
government cannot take those actions,

01:12:00.000 --> 01:12:04.999
then, you know, it is not for us to
step into that breech. Maybe that…

01:12:05.000 --> 01:12:09.999
that may the alternatives to this action. What
are the alternative changes into the management?

01:12:10.000 --> 01:12:14.999
Making those changes… isn\'t
going to guarantee success…

01:12:15.000 --> 01:12:19.999
it\'s still going to be a difficult
sale, but if we don\'t do those things,

01:12:20.000 --> 01:12:24.999
then I think you can always bank on failure. I
mean, we are not saying that it\'s impossible.

01:12:25.000 --> 01:12:29.999
We still may be able to find a buyer but to be
honest to be trying to sell and negotiating

01:12:30.000 --> 01:12:34.999
the sale of the bank when you haven\'t got
the really proactive and dynamic support

01:12:35.000 --> 01:12:39.999
of the head guys at the bank
and it is a bit of a farce.

01:12:40.000 --> 01:12:44.999
My fear is that if you\'ve known that ease of
management. Some people are ready to take

01:12:45.000 --> 01:12:49.999
an issue with it to improve management

01:12:50.000 --> 01:12:54.999
[sil.]

01:12:55.000 --> 01:12:59.999
And where I have landed you know,

01:13:00.000 --> 01:13:04.999
and these are not small people.
Uh… I only had these money,

01:13:05.000 --> 01:13:09.999
but this has been a change of management.
I hear that is no.

01:13:10.000 --> 01:13:14.999
Answer is no. Yeah, is no.
For what I\'ve been told.

01:13:15.000 --> 01:13:19.999
I didn\'t study this information,

01:13:20.000 --> 01:13:24.999
somebody just came through, fit me with it

01:13:25.000 --> 01:13:29.999
[sil.]

01:13:30.000 --> 01:13:34.999
And… so you\'re going to see.

01:13:35.000 --> 01:13:39.999
Uh… that\'s why for me… I… I am facing that

01:13:40.000 --> 01:13:44.999
these might have been discussed with
absolute confidentiality otherwise,

01:13:45.000 --> 01:13:49.999
you know,

01:13:50.000 --> 01:13:54.999
what we say that can easily be,
you know, spread on the street

01:13:55.000 --> 01:13:59.999
and then it complicates everything

01:14:00.000 --> 01:14:04.999
that is understood that (inaudible)
because there is nothing personal

01:14:05.000 --> 01:14:09.999
in this matter as you know.

01:14:10.000 --> 01:14:14.999
For the bank, there is a price attached
to the departure of Dr. Suruma.

01:14:15.000 --> 01:14:19.999
We have been patient.

01:14:20.000 --> 01:14:24.999
We don\'t know when we are going to
finally get some excessive measures

01:14:25.000 --> 01:14:29.999
the way here we are waiting. Dr. Suruma, as you know,
it\'s the government that has to decide the bank

01:14:30.000 --> 01:14:34.999
and advice and we have to be…

01:14:35.000 --> 01:14:39.999
you know, we are partners in development, so
we can advise and discuss and agree things.

01:14:40.000 --> 01:14:44.999
At the end of the day, this has to be… this
is something that government has decided.

01:14:45.000 --> 01:14:49.999
So government…

01:14:50.000 --> 01:14:54.999
(inaudible) ever been released. No, it hasn\'t
released. So, this is what… this is one of the thing

01:14:55.000 --> 01:14:59.999
that is required is that
you UCB be put up for sale

01:15:00.000 --> 01:15:04.999
and that\'s what\'s we have been…

01:15:05.000 --> 01:15:09.999
what has been now the last. No,
it was not in the original

01:15:10.000 --> 01:15:14.999
agreement as a condition. No… No… It
was actually it is a legal condition…

01:15:15.000 --> 01:15:19.999
I think you say you\'ve been continuing
your efforts to restructure

01:15:20.000 --> 01:15:24.999
the bank which you feel as
management is essential.

01:15:25.000 --> 01:15:29.999
We have, as I indicted

01:15:30.000 --> 01:15:34.999
to you a year ago that… that\'s

01:15:35.000 --> 01:15:43.000
we had full confidence in your…

01:15:45.000 --> 01:15:49.999
I think the… the plans… and your capacity available
within the UCB to continue with those plans.

01:15:50.000 --> 01:15:54.999
We didn\'t… the only difference was that while
that was going on the privatization still

01:15:55.000 --> 01:15:59.999
step should not be delayed until after
that that it should take place.

01:16:00.000 --> 01:16:04.999
Now, as it has happened, it has taken almost a year
since that decision was made to come to this point

01:16:05.000 --> 01:16:09.999
where now UCB is closed to be
putting up for sale, so… umm …

01:16:10.000 --> 01:16:14.999
Do you want to joint the others… I
understand you have… some colleagues…

01:16:15.000 --> 01:16:19.999
Yeah, I have a couple of other colleagues that\'s such you can… I wonder
you can permit them here or we can go to the boardroom and talk.

01:16:20.000 --> 01:16:24.999
I have asked my staff to come also.

01:16:25.000 --> 01:16:29.999
So maybe we need a bigger space. Okay.

01:16:30.000 --> 01:16:38.000
[sil.]

01:16:40.000 --> 01:16:44.999
So, you must welcome, Salem, your team,

01:16:45.000 --> 01:16:49.999
all are enjoying having discussions
with you or has learned a lot.

01:16:50.000 --> 01:16:54.999
I am sure this would be no exception.

01:16:55.000 --> 01:16:59.999
Uh… thank you Dr. Suruma. I
look forward to this discussion

01:17:00.000 --> 01:17:04.999
and further interactions
during especially with you.

01:17:05.000 --> 01:17:09.999
Like this… it\'s finally done… thank you.

01:17:10.000 --> 01:17:14.999
[sil.]

01:17:15.000 --> 01:17:19.999
This is Brian Faulkner calling you.

01:17:20.000 --> 01:17:24.999
I mean in my office at this point.
I know I have been hearing.

01:17:25.000 --> 01:17:29.999
Would you like to come on down and let
me know about the meeting? Thanks.

01:17:30.000 --> 01:17:34.999
Hi, hello.

01:17:35.000 --> 01:17:39.999
I\'ve got news for you. Yes.

01:17:40.000 --> 01:17:44.999
Now, you will be pleased to hear.

01:17:45.000 --> 01:17:49.999
It appears that a decision was made yesterday
and meetings between the minister of finance,

01:17:50.000 --> 01:17:54.999
Mr. (inaudible), the president
and who else was there.

01:17:55.000 --> 01:17:59.999
That they will accept Morgan
Greenfield\'s recommendation

01:18:00.000 --> 01:18:04.999
to change top management
in UCB and this will

01:18:05.000 --> 01:18:09.999
involve removing

01:18:10.000 --> 01:18:14.999
Dr. Suruma as of Tuesday or Wednesday next week and the
minister was worried still about the consequences.

01:18:15.000 --> 01:18:19.999
Hmm… Particularly… particularly
the fact but I think he felt that

01:18:20.000 --> 01:18:24.999
the issues one of… that he felt that

01:18:25.000 --> 01:18:29.999
they were some extent being pressurized, you
know… But today, I feel that today we have

01:18:30.000 --> 01:18:34.999
been using Morgan Greenfield
to make those recommendations?

01:18:35.000 --> 01:18:39.999
I told him also may be we have said
in the tone or maybe we have said

01:18:40.000 --> 01:18:44.999
they may come over as strong, but we
have also said to be very clear, look,

01:18:45.000 --> 01:18:49.999
we are mentioning this. We leave it
to you to make a decision because

01:18:50.000 --> 01:18:54.999
it is very important that you verify. I
realized that. Well done. Congratulations.

01:18:55.000 --> 01:18:59.999
I look forward to the
sale which is going on.

01:19:00.000 --> 01:19:04.999
[sil.]

01:19:05.000 --> 01:19:09.999
Washington, October 1996. (inaudible) returns
from the annual meetings of the bank,

01:19:10.000 --> 01:19:14.999
centered on the question of debt.

01:19:15.000 --> 01:19:19.999
[sil.]

01:19:20.000 --> 01:19:24.999
Hi, everybody… Well, it went very well.

01:19:25.000 --> 01:19:29.999
Well, congratulations hmm… So,
it\'s fantastic. Wonderful.

01:19:30.000 --> 01:19:34.999
And (inaudible) stood for it, and no way.

01:19:35.000 --> 01:19:39.999
Good. So, how, that\'s it. Got it
and that everybody consensus.

01:19:40.000 --> 01:19:44.999
No one single, you know, hesitation.

01:19:45.000 --> 01:19:53.000
[sil.]

01:20:00.000 --> 01:20:04.999
I am very happy

01:20:05.000 --> 01:20:09.999
to join with Mr. (inaudible) bringing to you
the fact that we\'ve reached agreement today

01:20:10.000 --> 01:20:14.999
and of course four of us at the
bank very, very happy indeed

01:20:15.000 --> 01:20:19.999
and very proud of the partnership
we have had with the monitory fund.

01:20:20.000 --> 01:20:24.999
I think this is a breakthrough. It\'s the first
time that there is a methodology of dealing

01:20:25.000 --> 01:20:29.999
with debt in a comprehensive way.
Uh… Let me announce the next step

01:20:30.000 --> 01:20:34.999
that have been agreed today.
The World Bank will establish

01:20:35.000 --> 01:20:39.999
and manage a Trust Fund to deliver
the debt relief for those countries.

01:20:40.000 --> 01:20:44.999
This Trust Fund could also be the principal vehicle for
participation of other multi-lateral development banks

01:20:45.000 --> 01:20:49.999
in the initiative and a focal
point for donor contributions

01:20:50.000 --> 01:20:54.999
towards the debt relief. I have already indicated
that there is an indication of our resolve

01:20:55.000 --> 01:20:59.999
to support this initiative that the
bank has committed 500 million dollars

01:21:00.000 --> 01:21:04.999
that will be transferred to this
Trust Fund and once we get in motion

01:21:05.000 --> 01:21:09.999
and as the need arises, I would propose
to recommend to our board contributions

01:21:10.000 --> 01:21:14.999
from our net income that would be
required to meet the proportional share

01:21:15.000 --> 01:21:19.999
of any debt relief. All in all, I
think, we\'ve had a wonderful morning.

01:21:20.000 --> 01:21:24.999
I think it\'s very good news
for the poor of the world

01:21:25.000 --> 01:21:29.999
and whole of us at the bank look forward to
working constructively on the individual cases

01:21:30.000 --> 01:21:35.000
with which we will deal almost immediately.

01:21:50.000 --> 01:21:54.999
[sil.]

01:21:55.000 --> 01:21:59.999
It has taken two years to put the debt initiative
in place. The monitory fund for its part has asked

01:22:00.000 --> 01:22:04.999
for further delays to allow
more time for adjustment.

01:22:05.000 --> 01:22:09.999
Uganda\'s debt would be brought down to what
the bank feels is a sustainable level.

01:22:10.000 --> 01:22:14.999
Critics say that the 30 million dollars offered
in the first year. It\'s too little and too late.

01:22:15.000 --> 01:22:23.000
[sil.]

01:22:30.000 --> 01:22:34.999
In the north, the rebellion continues.

01:22:35.000 --> 01:22:39.999
Civilians are being abducted and killed, but there is now the
additional problem of these affected soldiers crossing into Uganda

01:22:40.000 --> 01:22:44.999
from the former Republic of Zaire. Museveni\'s
army has to engage on several fronts.

01:22:45.000 --> 01:22:49.999
[sil.]

01:22:50.000 --> 01:22:54.999
After a heated debate in parliament

01:22:55.000 --> 01:22:59.999
49% of UCB has in principal been
sold to a Malaysian Holding Company.

01:23:00.000 --> 01:23:04.999
The improved economic situation

01:23:05.000 --> 01:23:09.999
has allowed the World Bank to increase its lending to
Uganda, thus adding to the countries total stock of debt.

01:23:10.000 --> 01:23:18.000
[sil.]

01:24:30.000 --> 01:24:38.000
[sil.]

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Our Friends at the Bank

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