Uganda Moves to Establish Cross-Border African Investment Bank and Indigenous Patient Capital

The State House Investors Protection Unit and the National Planning Authority (NPA) have today held a brainstorming meeting on the establishment of an Indigenous Patient Capital and Cross-border African Investment Bank.

The meeting was held at the State House Investors Protection Unit Offices in Kampala.

The meeting comes hot on the heels of the President’s directive to the unit to see how NPA can work with the private sector (TRAVACO) and the financial sector to realise the dream of setting up the indigenous patient capital and cross-border African Investment Bank among interested African countries like Tanzania.

The unit head, Col. Edith Nakalema expressed gratitude to the NPA, the Trans-Africa Value Corridor (TRAVACO) Ltd and other partners for spearheading the establishment of the two initiatives.

“I’m so happy for Dr. Beenunula Eyenunula that the vision you started is becoming a reality,”she said.

Col. Nakalema also informed the meeting that President Yoweri Kaguta Museveni is willing to support the idea in order to ensure that it works out.

Prof. Pamela Mbabazi, the Chair of NPA said the indigenous patient capital refers to a long term financial investment where sustainable growth is prioritised alongside financial returns.

“It focuses on initiatives that require time to grow and if we could unlock our ability to mobilise patient capital, we shall be able to execute many projects like the Standard Gauge Railway,”Prof. Mbabazi explained.

“While Uganda has a wide range of investment opportunities that could lead to the development of the country, it still faces the problem of funding and this project will help to address these financing gaps.”

Prof. Mbabazi further revealed that the capital will also help to strengthen the private sector which is key in driving the socio-economic transformation of the country. She said the sector is being frustrated by among others, high interest rates and limited funding.

“Some of the key objectives of establishing this indigenous patient capital is to strengthen the private sector.
Countries like Singapore, Malaysia, Botswana, Rwanda and Kenya have strengthened the private sector to drive their economic development,” she said.

“We should mobilise capital, we need to fund our development projects.”

The Managing Director of the National Social Security Fund (NSSF), Mr. Patrick Ayota said the idea of mobilising patient capital is a crucial one and it has helped a number of countries like China and Singapore to economically develop.

He also noted that the seed capital of USD5 million needed to kickstart the establishment is very little and it should be mobilised by the stakeholders to achieve the vision.

The Bank of Uganda Executive Director In charge of Supervision, Mr. Tumubweine Twinemanzi said the idea is a good one but in order for it to be successful, stakeholders need to first instil trust among investors willing to rally behind it.

“The concept is very fantastic but it’s a seed which needs to be planted somewhere and as we look at its establishment, we must till the land too.”

Dr. Beenunula Eyenunula, the CEO of TRAVACO said the project is aimed at dealing with the barriers such as capital deficits and infrastructure gaps that hinder the development of Uganda’s economy.

“Asia managed to break out of poverty through indigenous patient capital.In order to create the capital, we need to use asset management practices to create cash flow proceeds within 6 months. The minimum capital required is USD5m,” Dr. Eyenunula said.

“You need a certain capital you control if you want to benefit from various projects like the SGR. The African Investment Holding Ltd (Bank) can help to create indigenous patient capital.”

Maj. (Rtd) Gertrude Njuba advised that as the people behind the project, they need to do more work in the area of asset management to ensure that they convince the government to rally behind them.

“This is the type of funding we need to have because many countries have developed through such projects,” said Ms. Njuba, one of the brains behind the initiative.

The Former Minister for General Duties in the Office of the Prime Minister, Prof. Tarsis Kabwegyere also supported the project and urged that as stakeholders, they should use such brainstorming meetings to learn how to be secure from neo-colonialists through such independent initiatives.

He also advised that the government should support some Ugandans to go to countries like China for benchmarking purposes to see how they were able to achieve their development goals.

“Whatever you do, do it for your country and development,” Prof. Kabwegyere stressed.

The Former Attorney General of Uganda, Mr. Fred Ruhindi advised that discipline is key if Uganda is to achieve the milestone of setting up an Indigenous Patient Capital and Cross-border African Investment Bank.

“Let us help these people because we have the capacity to help them do what they want to do. We can achieve what China achieved if we have discipline.”

The meeting was also attended by the Deputy Governor Bank of Uganda, Dr. Michael Atingi-Ego, the Permanent Secretary-Ministry of Works and Transport, Mr. Bageya Waiswa, Mr. Ron Kawamara, the founder of Jumia, among others.