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UPDF 2 INFANTRY DIVISION

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Background and Problem Statement

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Background and Problem Statement

Last updated May 15, 2015

Operation Wealth Creation (OWC), is  an intervention that H.E. the President Yoweri Kaguta Museveni launched in July 2013 to create a system that facilitates effective national socio-economic transformation with a focus on raising household incomes for poverty eradication and sustainable wealth creation.

Uganda‘s impressive economic growth and GDP expansion under the National Resistance Movement (NRM) Government has translated into significantly lower household poverty levels, measured as headcount ratio (the number of individuals below the international poverty line of

$1.25 per day). The recent poverty estimates show that the share of Ugandans in absolute poverty has reduced from 56.4 percent in 1992/93 to less than 19.7 percent in 2012/13. Uganda has surpassed the first Millennium Development Goal (MDG) target of halving the proportion of the population living in extreme poverty by 2015, and is on track to achieve the Vision 2040 poverty target of 5 percent.

 

However, there is a big blot on this impressive performance. Household incomes for a big majority of Ugandans have remained low despite the fact that 80.3 percent of the population has escaped poverty. Uganda‘s per capita income, although has been growing at an average rate of

3.5 percent over the period 1990 to 2014, rising from US$320 (Atlas method, current US$) to

US$ 550 is still among the lowest in the world, making Uganda rank a lowly 164 out of 187 countries in the Human Development Index (HDI).

Figure 1 below clearly defines one of Uganda‘s (and Africa‘s) major tragedies: failure to raise household incomes of our citizens despite some impressive expansion of GDP. In 1970, Uganda and Malaysia had nearly the same level of per capita income, about US$130. The last four decades have seen Malaysia raise her per capita incomes to over US$10,000 while Uganda, just like many other African countries including Kenya and Ghana, has seen her per capita income stagnate at below US$1000. See Figure 1 below.

The reasons behind this stagnation in household incomes are numerous. However, key among them has been identified as failure by households in Uganda, and other parts of Africa, to engage in any commercial activities beyond subsistence farming.

                         Figure 1: Ugandas per capita income growth (1970 – 2008) compared with other countries

                                                    Source: World Bank’s World Development Indicators (2014)

 

These statistics point at one fact: the need to look at economic prosperity in terms of people‘s livelihoods and household incomes, going beyond macro-level progress. Thankfully, H.E. the President had already realised this and implored other leaders at all levels to start mobilizing the peasants to engage in commercialize activities. However, despite the various programs and efforts to mobilize people to commercialise their activities, results and outcomes have remained, by and large, discouraging.

Thus, in order to banish subsistence farming from Uganda, and embark on serious national socio- economic transformation of the country, H.E the President took a decision to tackle this challenge by involving the military in this new struggle under a program codenamed ―Operation Wealth Creation‖ (OWC). It started in July 2013 with the Zones which supported the military/political liberation struggles right from 1970s up to mid-1980s. The population that supported the military/political struggles, starting with war veterans, was selected to spearhead yet another ―war‖—this time a war against subsistence production and poverty, with the overall goal of achieving national socio-economic transformation.