The comprador culture and why UTL is not among Uganda's top tax payers

When I googled Uganda’s top taxpaying companies last week, an anomaly I found was that none of them was genuinely Ugandan. 

This isn’t to criticize or belittle the companies on the list but to assert that, most – if not all of them – derived their capital from outside of Uganda and have their profit repatriated outside the country. It is also important to add most of the directors of said companies are not Ugandan. 

While they do employ Ugandans, mostly at their lower employment levels, and they plough back taxes into the national piggy bank, it is inexcusable after over 30 years of economic and political stability we have a list this skewed. 

Perhaps I should further explain my fascination with the top taxpayers’ list; 

I was wondering why UTL, a telecom that is being bickered over, is not on the top taxpayers’ list.  

On the heels of the UTL standoff between the minister Evelyn Anite and the company’s administrator Bemanya Twebaze, I dug into documents of the profitability of the company. My logic was, if a company is profitable, as they say UTL is, it should at least easily attract an investor and at the very least, pay its taxes. 

There are perhaps two profiles that UTL wears that guarantee it of operating costs, taxes and overheads; first is that is a national telecom [Gov’t holds 30.8% stake in it – the figure varies in media reports to about 31%] and secondly, the company already controls and supplies all government Ministries, Departments and Agencies with backbone infrastructure and internet connectivity – an invoice in excess of billions of dollars. 

Any owner of capital, particularly, a Ugandan one, would be scampering at the opportunity to invest in the telecom – 26 billion for a first offer which could then raise to 280 billion over three years – at least that’s the deal the current holders have. 

But no one is. Why? 

We are not that rich or rightly put our economic development is not ours. 

There are very few countries – if not none – that have subverted the rudimentary capital development process. 

Capital starts with enterprise over fixed assets to produce profit. Repeated over time, it produces bigger profit margins which, if reinvested or divested are likely to produce more employment opportunities, better salaries, better working conditions and the like. 

However, in many post-colonial societies, Uganda included, the political and economic elite try to subvert this process by assuming control of the state and positions in it through government, use and/or abuse their power over public good to divert it for private gain. Without any real economic enterprise under their belt, they then hoard assets of the state – disguised as their own, to those with capital in return for bribes, positions and influence. This, communists and Marxists, aptly called the ‘Comprador Culture’. 

Compradore is a Portuguese derived lexicon to mean ‘buyer’. It was popularized a lot in East Asia by men who acted as fronts for European companies to do business. Compradors often act as agents of development when, in fact, they deliver maldevelopment, satellite economic growth and reverse development.

UTL, currently, is in the pangs of our political and economic elite compradors.

Each agent, with deep roots in the state, has convinced capital from different economic jurisdictions [Nigeria, Malaysia, United States] that they will win the race to buy the national assets of UTL. None is willing to flinch. None of the compradors – despite having considerable access and fortune – have capital to do what they are promising their agents. 

The government that holds the state, which should be capable of paying the debts of UTL and keeping all its assets is incapable because; it’s populated by compradors and it has neither the money nor expertise to run a profitable business. 

This leaves a critical national asset at the mercy of foreign capital. 

Let’s revisit the top taxpayers list;

The top taxpayer in Uganda is a telecommunications company – MTN. 

It is owned by shareholding, majority shares belonging to the Public Investment Corporation, a state owned investment arm of the South African government. The finance minister there, Anite’s S.A equivalent, is a shareholder representative. It operates in 22 jurisdictions. Profits of the company fall back and are used for social transformation, funding public housing, health initiatives and creating nearly 150,000 jobs. 

Why can’t the UTL dream be this big? I’ll never know. 

I can however, without much guessing, place my thumb on our narrow minded motives of the political and economic elite. The compradors! We can now officially say the comprador culture is with us.