That is how the govt lost the debate. Just imagine if it had argued that rising prices are a global phenomenon. YKM said some sensible things at his press conference in April 2011. In the short run, there is not much the govt can credibly do. Core inflation which excludes food and energy prices is something the govt/BOU can do something about. I wish the opposition had zeroed in on excessive money supply induced inflation. Then BOU can act. That is something the bank can do even now.
How the govt lost the debate is mind boggling. It was wrong to accuse the organizers of 2011 walk to work of treason. And if I may ask what is happening to real Ugandans…… OK ordinary Ugandans who normally walk to work? For them it is the norm rather than the exception.
YKM was poorly advised. Minister Matsiko was outright arrogant and stupid in her response. He should have put his economic team to task to explain core inflation because food and energy prices are not entirely a local or mad made inflation. Nature may have contributed to food shortages as Ugandans spent 2 full years politicking. There is no evidence as YKM tried to argue that rains failed. What failed was the politicians who wasted people’s valuable time on politics. That is the opportunity cost of too much politicking.
Let BOU release the money supply numbers for the last 6 months or so. That is where the real problem lies. Surely it cannot be wage inflation given the high unemployment in that country where workers have no voice.
It was the political decision to print money before the 2011 elections to win at all cost that has pushed the country to the edge. Even the poor farmers have no voice since the crops -their collective voice-was destroyed.
I take the position that YKM ordered the IGP to use such excessive force because he ordered BOU to print money-money that was found in minister Janet Mukwaya’s car during the 2011 presidential elections. The issue is about core inflation. How I wish our friends in the opposition had been forceful in their articulation. Neither side mastered the facts which is a shame
Let our friends in the media ask more questions about core inflation. The Governor of BOU should account because BOU is the guilty party.