Bank of Uganda and UN Urge Caution on Protection of Sovereignty Bill

The Bank of Uganda’s Governor, Dr. Michael Atingi-Ego, presented concerns to parliamentary committees about the Protection of Sovereignty Bill. He highlighted that it could block foreign direct investment and credit, weakening the country’s balance of payments and reserves, which stand near $6 billion.

Atingi-Ego stressed that without adequate reserves, Uganda’s sovereignty is at risk, potentially leading to shilling depreciation and higher inflation. This threatens the government’s plan to expand the economy to $500 billion by 2040.

The United Nations Resident Coordinator, Leonard Zulu, echoed these worries in a submission to Parliament. He noted that provisions on definitions and disclosures might violate treaties like the ICESCR and UN Charter, restricting development aid, humanitarian support, and partnerships in health, education, and social protection.

Zulu urged distinguishing between hostile interference and legitimate cooperation, emphasizing Uganda’s duty under international law to honor treaties in good faith.

The Bill, tabled by State Minister Gen. David Muhoozi, defines broad categories of ‘foreigners,’ including diaspora Ugandans sending remittances worth $2.5 billion annually. Critics, including the World Bank, point to ambiguities that could impact multilateral funding and economic stability.

Widespread opposition from civil society, religious leaders, and economists has grown, with diplomats calling for revisions to avoid harming foreign relations and investments.

Source: Daily Monitor