by Ronald Ssekandi
KAMPALA, Jan. 24 (Xinhua) -- In Uganda's capital Kampala, there are a multitude of betting booths with young people queuing in hope of getting a win. Betting has spread to the country's remote areas, and it is something the Ugandan government says must stop.
President Yoweri Museveni in a tweet on Thursday reiterated the government position to ban the registration of new fully foreign-owned betting companies while the old ones will not have their licenses renewed.
Uganda's concern is that all the money the locals lose in the betting is taken out of the country.
"All they do is to accumulate money from Ugandans then ship it out of the country," Museveni said, noting that the companies are using a loophole in the country's open policy.
"We should find smart ways of handling this and ensure that at least 70 percent including taxes stay in the country so that it is not a point of grievances between locals and foreigners," Museveni said.
Matia Kasaija, minister of finance, planning and economic development, on Tuesday told reporters that sports betting has little value to the country's economy, noting that it instead takes away the scarce foreign exchange.
He said betting is diverting the youth from working hard and instead resorting to get-rich-quick schemes.
Kasaija said he is going to come up with a paper to regularize the new policy.
In a parliament debate about the government's new move, some of the legislators this week argued that the move was drastic. Allan Ssewanyana said government should have adopted more stringent measures monitoring sports betting in the country.
Banning foreign-owned sports betting companies in Uganda seems to serve the government's new policy of reducing capital outflow as it strives to boost economic development.
Museveni made the comments about banning the foreign-owned sports betting companies while meeting with MTN Group's chief executive Rob Shuter. MTN is a South African multinational telecommunication company that has a branch in Uganda.
In a meeting with Shuter on the sidelines of the ongoing World Economic Forum in Davos, Switzerland, Museveni insisted that the company list its shares on the Uganda Stock Exchange. Museveni said Ugandans should own part of the company.
"Local ownership is important because it helps us stem capital flight which happens when the company is fully foreign owned. The question of repatriating 100 percent of your profits yet there is little value-addition and wealth creation for Ugandans is unfair," Museveni said in a tweet on Thursday.
A presidency statement issued on Thursday said Museveni was irked by the telecom companies not adding value to their products but instead extending talking services that have led to a severe leakage of the country's forex.
"Pay attention to this issue. IT penetration in Africa can end up being a problem. If you are providing a service for people to just talk without creating wealth. Telecommunications then get dollars which they take out, leaking even the little money that the country earns from its exports. You should foresee these trade deficits. More locally owned companies should be allowed to earn money so that most of it remains here," Museveni said.
Shuter said Uganda has only 5 percent shareholding in MTN and that the two sides are in the process of negotiating disposing shares to the country's National Social Security Fund.
