Uganda owes a number of international organisations Shs63b in unpaid mandatory subscriptions, putting its voting powers and eligibility to attend conferences where critical decisions are made at risk.
The debt figure is as of Financial Year 2014/15, which is the latest that Parliament’s Public Accounts Committee (PAC) is examining, meaning the arrears could have increased or reduced over the last three years.
Neither Foreign Affairs ministry Permanent Secretary Patrick Mugoya nor State Minister for International Affairs minister Okello-Oryem was available yesterday to explain why the country was defaulting on its obligations to multilateral organisation according to that local newspaper.
The Daily Monitor said it was unable to establish the number of international bodies to which Uganda is in default.
PAC shared its findings with all MPs on Monday, which showed that Uganda was forking out more in delayed payments due to fluctuations in the Uganda shillings.
This is because Uganda budgets and disburses money to ministries, departments and agencies in shillings, which it must convert to United States dollars to clear international subscriptions.
PAC noted that this is making Uganda to lose a lot of money needlessly.
For instance, MPs noted that whereas the government in July 2014 paid $3.2m (Shs11.8b) and $1m (Shs3.7b) to Preferential Trade Area (PTA) and East African Development Bank (EADB), respectively, at a rate of Shs2,670 per US dollar, the shillings had depreciated to Shs2,900 against a US dollar when government paid the second installment to EADB in January, 2015.
“There have been delays in settlement of such international obligations, with arrears accumulating to the tune of Shs63 billion at the year-end,” the report reads in part.
Failure to fulfil treaty obligations, the report adds, “gives the country a bad image among community of nations”.
In an interview with Daily Monitor yesterday, Finance ministry Permanent Secretary Keith Muhakanizi said the government was prioritising within its resource envelope.
“We have the money, but we have priorities. That is why we pay the United Nations and World Bank subscription,” he said, deflecting lawmakers’ accusation that defaulting to international organisations manifested planning and commitment deficits.