Multilateral creditors who provide debt relief to Uganda face an increasing dilemma. Keen for the country to be seen as a successful case of debt relief, they continue to support President Yoweri Museveni’s regime. Uganda is currently engaged in war with the Democratic Republic of the Congo (DRC). Therefore, how do creditors answer critics who suggest they are indirectly subsidising this war? How can they cope with Ugandan officials who exploit their anxieties?
An article from The Conflict, Security and Development Group analyses the politics behind this particular situation. Since 1996 the Ugandan People’s Defence Force (UPDF) has occupied a part of the Democratic Republic of the Congo (DRC). Simultaneously, Uganda is the only African state to have met the conditions of the Highly Indebted Poor Country (HIPC) initiative, thus qualifying for comprehensive debt relief. However, the Ugandan government has surpassed the ceiling on military expenditure, by diverting resources to sustain military activity. President Museveni is using war as a means to strengthen his position in relation to military and political rivals.
Despite being regarded by creditors as a successful example of economic reform – Museveni’s administration reveals a great deal of the vulnerabilities of patronage-based personal regimes. Sponsors of Museveni’s regime are stuck with a contradiction. If they cease their support, then the Ugandan government could risk popular rejection and the chance of a coup from a more corrupt group. However, by continuing with their financial backing they are aiding the UPDF’s ongoing deployment in the DRC. Thus:
- Ugandan officials exploit the anxieties of creditors because the creditors want the country to be recognised as a satisfactory case of debt relief and reform to justify similar policies in other states around the world.
- The UPDF military activity in the DRC gives soldiers the opportunity to plunder for private profit.
- Increasing ‘non-traditional’ Congo exports alleviates Uganda’s balance of payment problems, enabling creditors to hold-up the country as an example of successful reform.
- The IMF and the World Bank rate Uganda among the top four HIPC clients.
- Creditors get dragged into the politics of patronage based on violent commerce in political systems that cannot be reformed with the tools that they propose.
- Creditor resources enable the UPDF to fight in the Congo, while offering political cover for the Museveni regime.
Creditors should be aware of the ‘considerable risks’ involved in a balancing strategy. In addition, ignoring the weakest states could lead to them becoming weaker as rulers resort to desperate, externally-supported survival strategies. Policy relevant implications include:
- Where creditors attempt to be tough with poor clients, the latter seek opportunities to gain political capital from the intervention.
- Creditors must account for internal war and serious factional splits within their client’s regimes when making business calculations and will become evermore responsible for balancing these groups in search for order.
- International Monetary Fund and World Bank officials and other donor agencies must recognise that, unlike in the past, client government failure is not likely to lead to a coup.
- Outside attempts to organise African militaries into regional peacekeeping forces to intervene in disorderly neighbouring states risk undermining existing institutions in the countries that contribute troops.
