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Uganda Business News offered wanting details on national economic rebound

Many countries in Africa are experiencing difficult economic times, coupled with poor policies and bad politics.

For that, there is a wind of gloom sweeping across the continent. Most of her population is wallowing in abject poverty and surviving a general feeling of hopelessness. Indeed, some post-colonial governments – first celebrated as liberators from foreign domination and harbingers of hope – have retreated to wanton official corruption and deal-cutting, even as their citizens suffer the pangs of want and abuse of human rights.

That’s why a recent story published by the Uganda Business News that the country had registered a tinge of growth within its private sector performance was spirit-buoying.

In its edition of May 6, 2024, the paper ran an article titled Business activity rebounds after March decline’ in which the performance of the private sector – the engine of the economy – was said to have registered some growth. “Business activity picked up in April after a month of falls in output and new orders, as demand firmed,” the paper stated in the story’s intro.

What survey revealed this? “The Stanbic Bank Uganda purchasing managers’ index, which tracks monthly changes in private sector activity, rose to 52.6 in April from 49.3 in March. This was above the neutral level of 50, which indicates that a majority of firms reported an expansion in business activity,” the Uganda Business News responded.

It quoted Christopher Legilisho, a respected economist at Stanbic Bank saying that the “output and new orders recorded an uptick during the month (April) due to a resurgence in customer demand.” There was more. “Among the sectors surveyed, only the agricultural sector recorded a decline. The streak of employment gains continued for a 13th month, helping to clear backlogs of work.”

The Uganda Business News explained that the cresting in the tide of customer appetite for more led to “[t]he increase in new business [which] meant that firms increased their purchasing activity [sic] and, as a result, their inventories.” As a result, readers were told, the firms hired more workers, “to reduce order backlogs and meet new demand.”

The publication quoted the Stanbic Bank survey as concluding, thus: “Increases in staff and purchasing costs following higher raw material prices and higher starting salaries for new hires pushed up [the] overall input prices at the start of the second quarter … Business costs have risen in each of the past 33 months.”

This was a powerful story with the potential to raise the hopes of Ugandans in the performance of the country’s economy. However, it needed more details, harvested from relevant entities mandated with the collection of information on the performance of diverse micro and macro-economic sectors. Among others, the reporter should have got comparative data from the Uganda Bureau of Statistics (UBOS). Established through an Act of Parliament in 1988, UBOS is the principal data collecting, processing, analysing and disseminating agency responsible for coordinating and supervising the National Statistical Data System.

Another necessary and fecund source of relevant comparative information for the story should have been the Uganda National Chamber of Commerce and Industry, whose captains would have given first-hand testimonies on the performance of the sectors under their watch.

The story said that “among the sectors surveyed, only the agricultural sector recorded a decline” but did not name the sectors. Enumerating some of the sectors whose performances were reviewed over a specific period would have allowed readers to have a deeper comparative view of the performance of the economy. Also, the writer failed to list the factors explaining the dismal performance of the agricultural sector over the period of review. In short, why did the sector perform the way it did? And are there any mitigating factors – if at all – to arrest the situation. A forecast is a necessary addendum to a solid story.

The Uganda Business News claimed that “the streak of employment gains continued for a 13th month, helping to clear backlogs of work.” Pray, what sectors enlisted more workers over the surveyed period, and are there any numbers? The story didn’t say. What types of “backlogs of work” existed in what sectors of the economy? That wasn’t explained.

It is instructive that the story spoke of a rise in the tide of customer demand for goods and services over the period of review, but nothing was said to explain the reason for the positive phenomenon, and in what particular sectors. Firms, readers were told, employed more workers, but there was no sector breakdown to lend clarity to the claim.

The story ended on a rather convoluted note: firms employed more staff, paid higher starting salaries, thereby pushing up the overall input prices and ballooning the cost of doing business. If that was the case, it would have only meant one thing that all the gains the firms made were wiped out by the runaway operational costs!

Lesson learnt? Reporting on a country’s economic performance demands wide lenses for explaining all the main factors that contribute to the sum total of the obtaining status.

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