Presented at Conference On Constitutionalism And Rights: United States African Dialogue. August 12th - 15th, 1991

Kalyango, M.

English

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MAKERERE UNIVERSITY 
DEPARTMENT OF PUBLIC AND COMPARAT I VE LAW 
FACULTY OF LAW 
CONFERENCE ON 
CONSTITUTIONALISM AND RIGHTS 
UNITED STATES AFRICAN DIALOGUE 
AUGUST 12TH - 15TH, 1991 
PAPER ON 
• 
THE CONSTITUTION AND THE ECONOMY 
NEW OPTIONS FOR AFRICAN STATES 
PRESENTED BY 
H. KALYANGO, LECTURER 
FACULTY OF SOCIAL SCIENCE 
DEPT. OF ECONOMICS 
MAKERERE UNIVERSITY 
KAMPALA-UGANDA 
1. The Nature of the African Problems: 
The Development crisis in Africa is characterised by 
instability, wars, violation of human rights, systematic 
economic break down, and also by lack of human legal and 
' 
social development. The African charter for Popular 
Participation in Development and Transfo +mation (1990 :17), 
points to "a crisis of unprecedented and unacceptable 
proportion manifested not only in abysmal decline in economic 
indicators and trends, but more tragically and glaringly in 
suffering, hardship and impoverishment of the vast majority of 
African people." 
It has been argued further that the systematic economic 
breakdown is principally the result of the political and 
social conditions of the continent, characterised by poor 
governance, lack of public accountability and popular 
participation by the majority of people. However, views also 
exist that, infact the African c ri sis is primarily a political 
crisis both in character and origin. It is suggested that the 
focus on economic reform objectives is too narrow an approach 
and therefore what is needed is to link them, to political 
policies and programmes. The performance of many Afri can 
countries have tended to treat economic reforms as if they are 
independently contained in separate water tight co mpartm ents. 
The end result, has been the almost total break down in the 
societal capacities to provide goods and services and hence 
the current African development crisis. 
2 
2. African States Development Experience 
The development experiences of African states, for the 
last decades provides contrasting scenarios, whereas countries 
got their political independence almost three decades ago; 
each one of them has had its own experience . On one side, 
some adopted socialist approaches to development where their 
key economic institutions were nationalised. Rural 
de ve lopmen t was envisaged to be achieved th rough the same 
socialist approaches. Their experiences indicates that there 
was no dearth of an integrated political and economic system. 
Coup d'etat in African states have been followed by 
violation of constitutions, severe violation of human rights, 
various wars and almost total destruction of their economy. 
Even in considered stable countries like Tanzania, Zambia etc. 
the constitutional frame work guiding development strategies 
has still precipitates economic stagnation. 
3. Instability and Lack of Security in African States 
Africa is characterised by unending internal conflicts. 
Failure to resolve these political questions is a consequences 
of political systems in place c haracterised by absence of 
democracy i. e pluralism, lack of freedom of expression and 
suppression of opposition. Consequently, failure to address 
these issues has hightned internal conflicts with rebel 
activities becoming increasingly fashionable . 
In efforts to combat armed opposition governments have 
committed big percentages of their resources int o military 
spending . Budgets for defence have increased while that for 
2 
2. African States Development Experience 
The development experiences of African states, for the 
last decades provides contrasting scenarios, whereas countries 
got their political independence almost three decades ago; 
each one of them has had its own experience . On one side, 
some adopted socialist approaches to development where their 
key economic institutions were nationalised. Rural 
development was envisaged to be achieved through the same 
socialist approaches. Their experiences indicates that there 
was no dearth of an integrated political and economic system . 
Coup d'etat in African states have been followed by 
violation of constitutions, s~vere violation of human rights, 
various wars and almost total destruction of their economy. 
Even in considered stable countries like Tanzania, Zambia etc. 
the c onstitutional frame work guiding development strategies 
has still precipitates economic stagnation. 
3. Instability and La c k of Security in African States 
Africa is characterised by unending internal conflicts. 
Failure to resolve these political questions is a consequences 
of political systems in place c haracterised by a bsence of 
democracy i.e pluralism, lack of freedom of expression and 
suppression of opposition. Consequently, failure to address 
these issues has hightned internal conflicts with rebel 
activ ities becoming increasingly fashionable . 
In efforts to combat armed opposition governments have 
committed big percentages o f their resources into military 
spending. Budgets for defence have i ncreas ed while that for 
3 
social services, such as education health and industry, 
agriculture etc. have been cut. The need for food aid to 
war victims h as kept incre as ing - see table 1 below for some 
selected African countries. 
4 
Table 1. Food Aid, Fpod Pro du ction Per Capita , Average Growth Rate of 
Food Per Capita for Some Selected Co untries 
Country 
Uganda 
Somalia 
Angola 
Mozambique 
Food Aid '000 of 
metric tons 
1986 1987 1988 
6.7 15.0 29.3 
125.5 144.8 152.4 
52.5 60.5 100.7 
252.1 309.1 466.3 
Food production 
per Capita 
(Index, 1 979-81 
= 100 ) 
1985 1986 1987 
112 113 109 
99 102 102 
90 89 87 
79 80 78 
Average Annual 
Growth rate of 
Food per Capita 
1988 1989 
0.3 -3.5 
3 0.0 
-1. 1 -2.2 
1. 3 - 2 . 5 
--------------------------------------------------------------------- -
Source: Adapted from African Economic and Financial Data Report 1989. 
5 
Conflicts have also rendered loss of manpower and as result 
resources remain unexploited. More still large areas of the 
country side turns into wasted battle fields e. g Northern 
Uganda, Southern Sudan, part of Ethiopia, Mozambique, Liberia, 
Somalia. The list is long. 
In Summary, stability and security are a function of 
democratic institutions under strong c"onstitutional safe 
guards. As Kampala . Document issued by the Leadership 
Conference meeting in Kampala (22nd May 1991) pointed out "A 
fundamental link exists between national security, stability 
and sustainable development and these conditions can only be 
brought about by political pluralism encompassing full respect 
for human rights, official accountability and popular 
participation". The following recommendations were suggested 
for constitutional reforms: 
(a) Freely promulgated constitution with bills of rights 
provisions; 
(b) Limitations of the tenures of elected political leaders; 
(c) Security of tenure for officers in the judiciary; 
(d) Right to own properly; 
(e) Free and fair election. 
Hore to those recommendation women's rights were also 
strongly debated for inclusion in the constitution. 
This paper, from the out set therefore, recognises the 
economic implications of a stable political environment. The 
need for constitutional safe guards to create this viable 
political environment cannot therefore be over emphasized. 
6 
This paper will however confine its self to those 
constitutional safe guards that have direct bearing on 
economic development in light of the specific econo-political 
environments. 
4. An Indication of African Economic Crisis 
Looking at fig. 1 below one realises the various economic 
trends of different categories of develop~ng countries taken 
since 1967-87 and recognised that for sub-saharan Africa the 
trend since 1975 continued to decline signalling an economic 
crisis. 
Fig. 1 
Source 
Gross National Income per Capita in Sub-Saharan 
African and othe Developing Countries; 1967 - 87 
· 1980 cJo lbrs 
. ' i 800 ..,.-----------
____ ,,,,.,,,. 
700 D<;vl'loping ,,,. /' 
countries/,...-
600 
,..... 
. 500 
Suh-Saharan 
Arrica exc luding Ni geria 
400 
300 
200 
/' 
/ 
1ooi· -.----.-...,.--r--T-r--.----.-...,.--.,.--,-r--.----.-...,..-:->-r--,.----.< 
1967 1970 197 5 1980 198.'i 1987 
Source: World I.lank da ta. 
Ad ap ted from S yb-Sahar a n Africa fr o m c risis to 
7 
As we all know, the Gross National Income Per Capita i s give 
as Y where Y is the level of National Income of the country 
p 
and P is its population level. Therefore, it is generally 
apparent that the factors which influence the level of 
investment and population explosion in some developing 
countries have been favourable but for sub-saharan Africa 
countries these factors have been working in negative 
direction. This can be exemplified by the components of Per 
Capita Income Growth of the countries in sub-saharan Afri c a 
indicated below in table 2 . 
8 
Table 2. Comp onents of Per Capita Income Gro wth in Sub -
saharan Africa. 
1961 - 73 1973-80 1980-87 
Population Growth 
(A v erage annual 
gro wth rate ( % ) ) 2.6 2 . 8 3. 1 
Per Capita GDP 
growth (Average 
annual growth rate 
( % ) ) 2 . 0 -0.1 -2.6 
Investment Rate 
(Percentage of GDP) 15 . 0 20.6 15.9 
Rate of return o n 
investment (A v erage 
annual returns ( % ) ) 30.7 13 . 1 2 .5 
Source Adapted from Sub-saharan Africa from crisis to 
sustainable Growth Report 1989. 
9 
The figures above indicate that the rate of population growth 
since 1961-87 have been on increase. The per capita GDP 
growth on a decrease between the same period . The rate of 
• 
return on investment have been dwindling followed by the low 
investment rate. All those indicators illustrates 
quantitatively the extent of the sub-saharan economic crisis. 
5. 0 Future Projections of the Economic Performance of African 
States 
5. 1 Debt Service Payments, Interest Payment and Current 
Account Balance - Projections 
From Annex 1 it is predicted that the debt service 
payment, interest payments and current account balance by 
1975, might all have reduced from their current levels to 
22.2, 10, and -3.3 percent of export of goods and services -
given the favourable econo-political environment of the day. 
5.2 Total External Debt 
Again as indicated on Annex II, the African external debt 
might decrease up to 190.9 million US S by 1995 from 230 
million US S where it is now-assuming conducive econo-
political environment exists in the African States. 
5.3 Output and Foreign Trade Projections 
As indicated on Annex III, it is predicted that Annual 
change, in Percent of the real GDP between 192-95 might have 
increased to 8.2% while in the same period, the Annual Change 
10 
in percent for export and import volume might be the same at 
level of 2.7% in the same period. 
In Summary, African states are facing a very serious 
challenge of reversing their declining economic trends. 
Perhaps as pointed out in the World Bank Report ( 1989) the 
pre-requisites to achieve 
environmental protection, 
sustainable growth 
capacity building, 
include:-
population 
policy, Food security and regional integration and cooperation 
all coupled with emptus for channeling aid into these priority 
programmes. All those will assist to "build a better future 
for Africa" (page 27) 
6. Constitution and the Economy of Uganda Key Issues to 
Safe-guard: 
Uganda since 1970's has been characterised by instability 
violation of human rights, lack of human legal and social 
development which have all eptomised in coup detat and civil 
wars. These situations acted as both the cause and 
consequences of a systematic economic breakdown hence economic 
crisis as indicated below. 
: next 
;e) 
FIGURE 2 . 
ECONOHIC CRISIS IN UGANDA A CAUSATIVE AND EFFECT ILLUSTRATION 
b) Shortage of goods ~ 
and Foreign exchange 
controls and Regulations 6 
a) Conseguencies : 
- Low Production 
- Low exports 
- Low imports 
- Dilapilated 
social and physical-
infrastructure 
c) Fall in Government 
Revenue and subsequent. 
bank financing of the 
deficit 
d) inflationary 
e) Parallel markets 
in goods and 
foreign exchange 
- smuggling 
I pressures I@ 
~\ 
k) increase in production 
and transport costs 
- Reduction of food 
food profit margins 
to the producer 
j) foreign exchange 
shortage 
smuggling out 
products 
import~~,gooqs 
inputs and , 
export crops. 
11 
f) Exchange 
rate over 
valuation 
m) Kill producers 
incentives 
i) Producers 
Terms of Trade 
Falls 
h) Low prices to 
'--~~~~~-ft-r-J I 
- Switching from 
one activity to 
another 
1) Fall in government 
development expenditure 
- Fall in govt. services 
- Reduction of subsidies 
S f""\1~ :c-..:l n d ~nt 0 d f r om Uaanda EcoDomic Association Paper 1990 
producers 
- Low govt. 
tax revenue 
- cheap import 
12 
Key To Figure 2 
A 
B 
c 
D 
E 
F 
G 
H 
I 
J 
K 
L 
M 
Resctrictive Economic Policies (Price Controls) 
Fixed Exchange Rate 
Wars 
Budget in Discipline 
Money suppl_y 
Inflation 
Tax assessement, Collection and Administration 
problems 
Skewed Loan Allocation Among Districts 
Rent - S~~K.ing Within the Economy 
Capital - Flight 
Corruption 
Foreign Exchange Management Problem 
Conflicts 
13 
By reviewing the Uganda's economic crises, one realises 
areas which need constitution consideration namely:-
i) Pricing policies 
ii) Exchange rate policies 
iii) Budget discipline 
iv) Honey supply policies 
v) Inflation policies 
vi) Taxation policies 
vii) Rent-seeking policies 
viii)Capital Flight policies 
ix) Foreign exchange management policies 
x) Methods of resolving conflicts 
7. Conclusion 
This paper has high-lighted the pathology of African 
crisis and its perspective. It has identified that African 
crisis is multi-faceted including both political and economic 
issues. But when African leaders met at Kamp.ala Forum, they 
high-lighted more on political issues which need 
constitutional consideration than economic ones. 
African leaders realis e d the urgent need to transform 
there states and observed that "African countries should adopt 
Liberal economic policies that will attract capital, a factor 
of production in which African states are enormously 
deficient" (page 10). This observation stresses the need for 
African states to strengthen their financial sector if they 
are going to transform their economies. The strengthening 
need not only simple policy reforms but even constitutional 
considerations of African states of today and tomorrow. 
14 
REF ERENCES 
1. African charter for Popular Participation in Development : 
1990. 
2. African Leadership Forum : Kampala Document. 22 Hay 1991 
3. IMF : World Economic Out look 
4 . 
5. 
6 . 
A survey by the staff of the International Monetary 
Fund : Washington D.C. October, 1990. 
Uganda Economic Association (UCA) Macro-economic 
constraints and the grbwth of the informal sector 
in Uganda , Hay 1991. 
UNDP/World Bank African Economic Financial Data 
September, 1989. 
UNESCO : Internal Conflict Research : 
Paredigns, geopolitics, nationality, enemy images, 
arms control, ethenic dimensions International 
Social Science Journal February 1991 No. 127. 
7. World bank : Sub-Saharan Africa from Crisis to Sustainable 
Growth : November 22, 1991. 
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ANNEX I 
CURRENT ACCOUNf BALANCE, INTEREST PAYMENT AND DEBT SERVICE PAYMENI 
PROJECTIONS FOR AFRICAN STATES BASED ON MEDIUM-TERM BASELINE 
SCENARIO I982-U5 
30 
20 
10 
0 
-10 
-20 
1982 
o Debt Service 
Payments 
1986 1987 1988 1989 1990 1991 
YEARS 
+ lnborest Poyments 
SOUf{CE: Adapted from World Ecunomic Outlook Report 1990 
1992 1995 
0 Current kcount S. 
fW\f_X II 
TOTAL EXTERNAL DEBT. PROJECTION FOR 
AFRICAN STATES BASED ON MEDIUM TERM ~Llf\E SCENll.HlO 1982-85 
260 
240 
220 
200 
180 
160 
140 
120 
100 
80 
60 
40 
20 
0 
1982 1986 1987 1988 1989 1990 1991 1992 1995 
YEARS 
Scx.Jrce : Adapted Fran . IAbrld Ecxranic D.Jtlcd< Rep::irt 1990 
w 
~ 
~ 
0 
w 
Cl 
f! 
z 
w 
0 
a:: 
w 
D.. 
_J 
~ 
z 
z 
-4'. 
,IW\[X Ill 
OUT-PUT AND FOl~EIGN TRADE PROJECTIONS BASED ON MEDIUM IrnM BA SE LINE 
SCENARIO 1972 - 95 OF AFRI CAN STA TE S 
198119861986198719881989199019911992 -95 
YEARS [SS[ Export Volume ~ Terms of Trode ~ In-port 
Adapted from World Economic Outlook Report 1990 
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The constitution and the economy: new options for African states

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