KAMPALA, June 12 (Reuters) - Festering anger over failure to tackle
entrenched corruption and deteriorating quality of public services could
spur a flare-up in street violence in Uganda even as opposition-led
anti-government protests appear to have petered out.
Opposition leader Kizza Besigye is still eager to exploit these
long-standing grievances and galvanise his supporters to repeat last year's
months-long street protests, which he wants to use to topple his veteran
rival, President Yoweri Museveni.
PROTESTS
Besigye's anti-government demonstrations, which peaked in first half of last
year, have waned, as inflation - which fuelled the initial phase of the
protests - continues to fall from last year's record highs.
Analysts, however, say anger over a range of other unresolved grievances
including poor public services and allegations of corruption and rights
abuses still runs deep and could make any future eruptions of unrest more
violent.
The opposition says they've tactically decided to take a break from street
action to first strengthen their grassroots mobilisation networks and build
a critical mass of supporters bold enough to confront a determined state
security apparatus.
A government crackdown on last year's protests left at least nine people
dead and Besigye, who heads Uganda's biggest opposition party, Forum for
Democratic Change (FDC), was pepper-sprayed in the eyes and left half blind.
A sharp economic downturn might contribute, analysts say, to bitterness and
frustration especially among the youth.
According to the Uganda bureau of statistics, economic growth is expected to
plunge to 3.2 percent in this fiscal year (ending June 30) from 6.7 percent
in 2010/2011.
"You have a population already deeply bitter over unending corruption, ever
worsening public services and raw nerves over blood spilt in last year's
protests," said Angelo Izama, the head of the Fanaka kwa Wote think tank
that conducts research in political and security risks for businesses.
"And now the economy takes this massive blow ... Such a contraction means so
much more youth who can't find jobs, and those are the ones Besigye needs
for action."
Besigye, who has run for the presidency and lost three times, rejected the
results of last year's elections saying he had been cheated of victory.
He and other opposition leaders have also vowed to defy a ban on Activists 4
Change (A4C), an opposition pressure group allied to Besigye. This raises
the possibility of violent confrontation with the police.
What to watch:
- Besigye. Can he manage to tap into deep-seated resentment to spark new
protests?
- 2012/2013 Budget. Will government significantly boost funding to key
sectors like energy and transportation, which can create jobs and absorb
multitudes of unemployed youths?
ANTI-GAY LEGISLATION
A bill calling for harsh penalties against homosexuals has been reintroduced
in parliament.
A previous bill had called for the death penalty for repeat offenders,
though the new version is expected to drop this clause as well as calls for
life imprisonment.
What to watch:
- If any draconian anti-gay legislation is passed, it could prompt some
international donors to cut aid.
OIL, TAX DISPUTES
Uganda's plans to become a top-50 oil producer are back on track after
British oil explorer Tullow Oil said it had signed a delayed deal with
China's CNOOC and France's Total to develop its oil resources.
Tullow says it hopes to spend, together with the two partners, a total of
over $750 million in Uganda this year on exploration and drilling.
The money is part of a $10 billion investment that the three companies say
they need to invest over the next few years to put in place key
infrastructures including a refinery to enable Uganda commence commercial
crude production.
British oil explorer Heritage Oil said in November it would launch an appeal
against a Ugandan tribunal which has ruled the company is liable to pay $404
million in capital gains tax, prolonging a row over the tax bill.
The government is awaiting passage of three pieces of proposed legislation
now in parliament and aimed at regulating the nascent oil sector before it
starts issuing new exploration licenses.
What to watch:
- Delays. As Uganda and oil firms embark on the development phase,
disagreement over policy issues is likely to emerge, which could further
push back the start of crude production.
- Tax disputes. If tax issues are not solved quickly and amicably, Uganda
may gain a reputation as a risky bet for foreign investors.
- Start of oil production. Oil revenues will help the government stem
protests by escalating public spending.
INTERNATIONAL TENSIONS
Uganda has said it would back its northern neighbour South Sudan if it got
sucked into a war with its long-time foe Sudan.
A war in South Sudan, one of landlocked Uganda's most lucrative export
markets, would deal a massive blow to the Ugandan currency, the shilling,
hit the business community and possibly ignite unrest.
In Somalia, al Shabaab Islamist rebels have threatened more attacks similar
to twin suicide bombings in Kampala that killed 79 people in July 2010. The
insurgents have vowed to target Uganda and Burundi until they withdraw their
peacekeeping troops from Somalia.
What to watch:
- International diplomatic efforts to end the disputes between Sudan and
South Sudan.
- Progress in the offensive against al Shabaab.
- Another attack in Uganda could deter foreign investment inflows, further
weaken the shilling, disrupt business and hurt tourism. (Editing by James
Macharia and Alessandra Rizzo)
C Thomson Reuters 2012 All rights reserved
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Received on Tue Jun 12 2012 - 10:56:03 EDT
