OPINION: By Fred Daka Kamwada
When the High court in Uganda ruled that Diamond Trust Bank (DTB) had to pay Ugandan businessman Hamis Kigundu and his company a sum of 120 billion shillings together with interest following a legal technicality in the process, most Ugandans thought it was fairly based on justified reasons.
In March this year, Ham and his two companies Ham Enterprise Limited and Kiggs International (U) Limited sued DTB -Uganda, and DTB-Kenya accusing them of fraudulently siphoning more than 120 billion Shillings from his accounts without his knowledge and consent.
Without going into the details of the court ruling, you have to listen to the video clip of Ham himself in which he seemed to address Ugandans on Independence Day 9th October 2020 last week.
In the video message which was shared widely on social media networks, Ham makes statements which expose the weaknesses and lack of substance in his submission in regard to the misunderstandings he has with the bank.
He made around five outrageous claims which I want to dwell on for the sake of objective analysis. I listened to the video clip and concluded that my compatriot is purely ignorant on how the economy works especially in regard to the investors.
Claim One; Foreign-owned Banks
Ham (Hamis) claims that Ugandan banks are mostly owned by foreigners who oppress Ugandans and pamper their fellow foreigners. He also went on to say that these banks have low capital float which cannot afford to run their banks effectively. That they use financial deposits from the locals to give out loans because they are undercapitalized.
The question then is, why did Ham choose to opt for a foreign-owned bank? Are there no local banks owned by local Ugandans?
We have banks that are purely owned and run by Ugandans and have sufficient capital float capable of giving out any amount of money. A case in point is Centenary Bank which has been doing very well for very many years and continue to do well up to the present day. Why didn’t he go to Centenary Bank that is owned by locals?
But most important of all, in the video clip, Ham doesn’t explain how he got into a misunderstanding with the bank. He openly evades the fact that he had a financial relationship with the bank. He even doesn’t explain circumstances of how he got involved the bank, leave alone whether he picked a loan from the bank or not. This in itself simply means that he is not being truthful.
CLAIM TWO; Discriminative Loan Offers
Ham goes on to claim that these foreigners give out less money to Ugandans in a very discriminative manner. That these banks give big money loans to foreigners compared to Ugandans.
Question then is, if these banks are known to give little money to local Ugandans as compared to the feigners whom they give a lot, how did he manage to get all those billions of loan money from the same bank?
Did he first disguise himself as a foreigner to qualify for the big money loan? Can he explain to Ugandans how he managed to maneuver and get access to such a loan facility which he claims was a preserve of foreigners.
CLAIM THREE; Illegal Withdraw Of Shs120bn
Ham claims that diamond trust bank managed to illegally withdraw money from his accounts to a tune of 120 billion shillings in a space of ten years.
Question is, how DTB managed to get access to his bank accounts in the first place. Was he already having a financial relationship with the bank or not? Why did it take him ten years to realize that the bank had withdrawn all that huge sum of money from his accounts? Ten years is not just a walk in the park. It’s such a very long time.
The truth is that DTB withdrew all those colossal amounts of money from his accounts in a prearranged process of paying back the loan he had got.
CLAIM FOUR; Discriminative Interest Rates
Mr Ham also asserts that DTB is so discriminative that it charges higher interest rates to Ugandans and offers lower interest to foreigners.
By making such a claim, Ham failed to do us a favor by breaking down the discriminatory process of the interest rates of the bank. Ham should have explained the rates given to Ugandans vis-à-vis the rates given to foreigners.
He for instance failed to reveal what interest rate was imposed on him in the first place, when he picked the loan. But he didn’t.
By not revealing the discriminatory details of the interest rates, Ham did not seem to be truthful at all.
CLAIM FIVE; Capital Flight
Ham tried to incite Ugandans to rise up against the foreign investors by claiming that owners of these banks do what is termed as capital flight when they make a lot of profit which they take to their countries.
Ham was trying to tell Ugandans that these foreigners are not entitled to the profit they make from their investments in Uganda. Oh dear!
By making such a claim, Ham is trying to suggest that investors should invest money in Uganda and keep the profits in Uganda for the good of Uganda! Oh, what a pack of ignorance!
When the president goes to foreign countries and pleads for investors to come to Uganda, the first incentive he promises these investors is the profitability of the country called Uganda. He tells them that they will make more profits here more than they would in any other country in the world.
In fact, when the president was making his Independence Day speech this month, he quoted an Indian who described Uganda as a country of three Ps, 1; pleasant,2; peaceful and 3; profitable.
What Ham should know is that Uganda needs investors more than ever before to the extent that we give them tax holidays to seduce them to pump big money in our economy. Where does he get the audacity to question the way they use their money in Uganda?
If Ham makes investments in Kenya, can he keep that money in Kenya or he brings it back home?
In any case Ham is ignorant of the fact that Uganda benefits from investors through indirect means like offering employment to Ugandans, paying taxes, paying for utilities like electricity and water etc.
By Him questioning the capital flight by investors exposed his ignorance about how the economy runs. There are inward, forward and backward linkage benefits involved with investors which I expected Ham to know.
Finally, Ham makes what he termed as a patriotic call to Ugandans to shun these foreigners and their impunity. This patriotic call was nothing but a xenophobic attack on investors.
He tried to call on the judiciary and government to make sure that they don’t bend to the calls from investors because they are exploitative. Was he trying to persuade government and the people of Ugandan to turn against these investors?
Ham claims that he had proposed bank reforms, but failed to narrate which reforms he was talking about. Was he trying to say that foreigners shouldn’t own or run banks in his reforms?
Was he trying to suggest that profits made by investors must stay in the country? Why doesn’t he elaborate on those bank reforms he claims he was championing?
Although I have not dwelt on the court judgment itself, I suspect that once the bank makes an appeal, which is obviously inevitable, Ham will lose the case.
I rest my case for now with the hope that Mr. Hamis kigundu has learnt the importance of the investors and how they operate.
The author Fred Daka Kamwada is a social critic and a blogger
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