More on debt, macroeconomic stability, and natural resources in Africa (Uganda Edition)

See earlier posts on this subject here and here. Below is a quote from FP on Uganda’s growing petroleum sector (see also the Global Witness report on Uganda’s secret oil contracts here):

Source: Global Witness

Uganda’s Projected Oil Production Curve. Source: Global Witness

The bulk of Ugandan government borrowing against future oil revenues has focused on grand infrastructure schemes built and funded by the Chinese. In 2014 alone, the government signed deals with China to build two hydropower dams worth $2.2 billion, a standard gauge railway that could cost up to $8 billion, and a $600 million fertilizer plant. Additional projects include a $2 billion oil field being developed by the state-owned China National Offshore Oil Corporation and a $350 million roadbetween Uganda’s capital, Kampala, and Entebbe International Airport. The possibility has even been raised that a Chinese bank may bail out Ugandan parliamentarians in danger of going to jail for failure to honor their debts.

And how efficiently is Uganda spending the [expensive] borrowed money?

Costs for the Ugandan section of the East African Standard Gauge Railway are especially out of control. The project had an initial price tag of $4.5 billion for the Ugandan side of the railway, compared to $3.8 billion for the Kenyan side. Estimated costs in Uganda subsequently shot up, first to $8 billion and then to a staggering $11 billion

So what will happen when China decides to deal with its public debt situation and the effects propagate to its many public companies involved in mega-projects in Africa?

To reiterate, let’s not declare mission accomplished in the war against the resource in Africa just yet.

Who runs the world?

May be it is just because my adviser at some point studied the politics of language and identity (see here and here), but this morning over breakfast as I was watching the newly elected appointed successor of Hu Jintao as president of China give his inaugural speech to the press I was reminded of the continued soft (and hard) power of the English speaking North Atlantic world – or just simply the US.

In my opinion, it says a lot that the Chinese authorities felt the need to have a translator in the room, and for Mr. Xi Jinping to wait after every paragraph or so for the English translation to go through (they may have had translations to other languages as well, I was watching it live on the BBC).

Imagine the day when a newly elected US president, standing on the steps of the Capitol, gives a speech in English but has to wait every now and then for a Mandarin Chinese translation to go through.

I may be making too much of this. It all might have been a deliberate attempt to engage the rest of the world. As Time reports, Mr. Xi urged the press to facilitate more exchanges between China and the rest of the world:

But most of all, Xi was in a celebratory mood, advising the gathered press to do their part in furthering cross-cultural awareness. “Friends from the press, just as China needs to learn more about the world, so does the world need to learn more about China,” he said in a jocular tone. “I hope you will continue your efforts to deepen mutual understanding between China and the world.”

Language is very central to human interactions, and whoever has power over language usually has a lot of sway (as is argued in the books above). This morning someone won the politics of language. And it was not Beijing.