Abu Mukasa’s Shoddy Deals: How One Man’s Machinations Have Cost Uganda Billions
The Series Of Deals Fronted By Abu Mukasa Have Cost Uganda Dearly, Both Financially And In Terms Of Lost Opportunities For Better Agreements
Uganda Today Edition: Abu Mukasa’s Shoddy Deals: How One Man’s Machinations Have Cost Uganda Billions
In the past five years, Uganda has been entangled in a series of questionable deals that have cost the country billions of shillings, all while enriching a few individuals. Central to these deals is Abu Mukasa, a well-known wheeler-dealer who has successfully fronted various foreign entities, enabling them to bypass Uganda’s tendering processes, procurement procedures, and scrutiny by knowledgeable government officials. The result has been a series of long-term agreements that have left Uganda bound by costly and unfavorable terms.
The MS Joint Stock Global Security Debacle
One of the most glaring examples of these deals is the agreement signed in 2021 between the Ugandan government and MS Joint Stock Global Security, a Russian company fronted by Abu Mukasa and Albert Ruganju. The deal, worth millions of dollars, was to install digital tracking chips in all automobile number plates registered in Uganda under the Intelligent Transport Monitoring System Program (ITMS). This agreement was secured without following the most basic Public Procurement and Disposal of Assets (PPDA) procedures. Moreover, crucial information about the company’s operations, address, and legal status was conspicuously absent.
Three years after the agreement was signed, the results are dismal. As of March 2024, only 240 government vehicles had been fitted with digital number plates, despite Uganda having over 2.3 million private and government vehicles, according to 2020 statistics from the Ministry of Works and Transport. It later came to light that MS Joint Stock Global Security was insolvent and mired in bankruptcy cases in Russia, raising serious concerns about the due diligence conducted before signing the agreement.
The Vitol Bahrain Oil Deal
In another instance, Abu Mukasa played a key role in securing a five-year, multimillion-dollar oil and fuel products importation deal for Vitol Bahrain. This deal named Vitol as the sole supplier to the Uganda National Oil Company (UNOC) for distribution to oil marketing companies. The Petroleum Supply Amendment Bill, which was tabled in Parliament to facilitate this supply chain from Kenya to Tanzania, was reportedly marred by allegations of bribery, with Mukasa allegedly offering USD 20 million to push the bill through.
The bill was passed in November 2023, despite strong opposition from some legislators. Critics argued that the deal would enrich Vitol at the expense of Ugandans, as the company would incur interest charges to supply UNOC, leading to higher fuel prices once a monopoly was established.
The Costly Standard Gauge Railway Contract
In January 2023, the Ugandan government signed a memorandum of understanding with Yapi Merkezi, a Turkish company, to build the Standard Gauge Railway from Malaba to Kampala. The initial quoted cost was €3.4 billion, equivalent to USD 3.6 billion—significantly higher than the USD 2.2 billion previously agreed upon with the Chinese contractor, China Harbour and Engineering Company. The agreement with the Chinese was terminated in favor of Yapi Merkezi, which was fronted by Abu Mukasa and Albert Ruganju and represented in negotiations by K & K Advocates. Like other deals involving Mukasa, there was no bidding process for the selection of Yapi Merkezi, raising further questions about the integrity of the process.
The Hoima Oil Refinery Project
Abu Mukasa also fronted the USD 4.5 billion deal with Alpha MBM Investments to build an oil refinery in Hoima District. Once again, K & K Advocates represented the company in negotiations with the Ugandan government, and the deal was pushed through without the usual scrutiny or competitive bidding processes.
The GVG Telecom Monitoring Scandal
Perhaps one of the most damaging deals facilitated by Abu Mukasa was the contract with Global Voices Group (GVG) to monitor tax compliance by telecom companies. Initially signed in 2016, the contract cost Uganda USD 62 million annually. Despite clear evidence and technical reports from the Director of Revenue Intelligence (DRI) that the GVG system had failed to meet its contractual commitments, the government renewed the contract in 2023 for another five years at an additional cost of UGX 231 billion.
The initial contract was secured when Mukasa introduced GVG to Ugandan government officials, with the deal concluded by K & K Advocates. At the time, the current Attorney General, Kiryowa Kiwanuka, was a Senior Partner at the law firm, further complicating the web of connections and potential conflicts of interest.
Conclusion
The series of deals fronted by Abu Mukasa have cost Uganda dearly, both financially and in terms of lost opportunities for better agreements. The lack of transparency, disregard for procurement procedures, and apparent conflicts of interest have left the country bound by long-term, unfavorable contracts that benefit a few at the expense of the many. As these deals continue to unfold, there is an urgent need for greater scrutiny, accountability, and reform in the way government contracts are negotiated and signed in Uganda.
