Pro-Poor Development and Poverty Reduction in Uganda and the Idea of Social Market Economy
Proceedings of a High-Level Roundtable Discussion organised by KAS and ACTADE
The publication compiles the input presentations and results of the discussions at a high-level roundtable on the topic „Pro-Poor Development and Poverty Reduction in Uganda and the Idea of Social Market Economy“, held on 3rd November 2011 at the Serena Hotel in Kampala. The discussion was organised by the African Centre for Trade and Development (ACTADE) with support from the Konrad-Adenauer-Stiftung (KAS) and brought together an exclusive number of 30 invited participants with leading roles and particular expertise in the areas of economic governance, development and poverty reduction.
The event aimed at facilitating a high-level dialogue on economic policies and to trigger a constructive debate on the principles of social market economy in light of the challenge of poverty reduction in the Ugandan context. It particularly addressed the question of whether some of the principles of social market economy can be applicable in the Ugandan context and provide a positive contribution to the struggle of poverty reduction, and whether an economic policy oriented along such principles could provide a viable strategy for enhancing pro-poor development.
The African Centre for Trade and Development (ACTADE), who partnered with KAS in convening the highlevel roundtable discussion, operates as non profit independent policy research organisation/think tank. The work of ACTADE has continued to concentrate on thematic areas and programmes including: Trade Policy and Economic Development; Climate Justice for Sustainable Development; Budget Analysis and Information Initiative; and Basic Needs Basket. The components of ACTADE programmes are: research, dialogue & debate, capacity building, information dissemination, and alliance building.
“Social Market Economy” is one of the current focal points in the work of the Konrad-Adenauer-Stiftung worldwide. Since the beginning of 2011, the portfolio of the KAS country office in Uganda includes the promotion of basic principles of social market economy as a new major objective and intervention area.
A first milestone under the new focal area, was the launch of a study on “Economic Policies in Uganda and the Principles of Social Market Economy” and the visit of Prof. Dr. Horst Köhler, former President of the Federal Republic of Germany and former Head of the International Monetary Fund (IMF), Uganda in June 2011. During his visit he discussed the concept of social market economy in the Ugandan context with outstanding Ugandan experts and government representatives in a conference under the title „The Role of State and Market for Sustainable Development in Africa“. During and after the conference various stakeholders expressed their interest in and commitment to an ongoing dialogue on economic policies in Uganda. KAS Uganda will continue to facilitate such a multi-stakeholder dialogue in cooperation with the local partner ACTADE in order to have a constructive focus on the improvement of economic policies in Uganda, giving special consideration to the principles of social market economy as a potential inspiration. Thus, the roundtable discussion in November 2011 provided the starting point of a series of joint interventions by KAS and ACTADE which shall continue in 2012 and beyond.
This publication consists of three parts. Part one presents the main input paper for the roundtable discussion which was provided by Dr. Fred Muhumuza, Research Fellow at the Economic Policy Research Centre (EPRC) and Economic Advisor in the Ministry of Finance Planning and Economic Development. In his paper on the topic “The Principles of Social Market Economy and Poverty Reduction in Uganda” Dr. Muhumuza reviews the existing strategies for poverty reduction in Uganda in light of the principles of social market economy.
The second part presents a paper by Elly Twineyo, Executive Director (on leave) at ACTADE, on the discussion topic “Pro-Poor Development and Poverty Reduction in Uganda and the Idea of Social Market Economy”. From the starting point of economic theory, Twineyo looks at the role of the government and the market with regard to poverty reduction and wealth creation and gives food for thought for the discussion.
The third part provides a synthesis of the open roundtable discussion which followed the presentations of the two papers. During the discussion it was highlighted that the principles of social market economy can provide a good orientation for improving economic policies in Uganda. Participants argued that some of the principles have indeed already been adhered to in Uganda - though implicitly.
However, it was also noted that whereas the existing economic policies, development plans and poverty reduction strategies provide good starting points, there appears to be a lack of effective and consistent implementation of the same. One of the strong recommendations that transpired during the discussion was for all stakeholders in the economy to clearly define their roles and responsibilities, particularly with regard to the relationship between the government and the private sector. It was argued that the government needs to improve the relationship with the private sector and provide a conducive environment for doing business within a consistent regulatory framework. The government should play a regulatory role, but without unnecessarily interfering with the market.
Beyond the roles of the government and private sector, participants also urged all stakeholders to widen the perspective and look at the general citizenry that would need sensitisation on economic policies and the principles of social market economy. It was argued that an economic system that promotes development and social justice needs to be based on a strong foundation of certain core values, which was currently still missing in Uganda. Therefore, future dialogues on economic policies should also put a strong focus on the underlying values in society.
By publishing the input papers and proceedings of the first roundtable discussion on social market economy, KAS and ACTADE hope to provide a source of reference that can further stimulate a continuous dialogue on economic policies in Uganda. Both organisations remain committed to continue promoting such a dialogue through a series of further interventions.
Uganda, December 14, 2011