New property rights in former state firms in Uganda

David Lameck Kibikyo

Abstract

The paper investigates the nature of property rights of the former state owned enterprises (SOEs) in Uganda. Several records both official and non-official were consulted. The results indicate that the nature of property rights of the former SOEs in Uganda were complex because of overlaps and cloning. An enterprise was capable of taking several forms including but not limited to local, foreign, state, mixed or joint ventures and private. For instance, local firms were either private or government. Some so-called private enterprises were parastatals (SOEs) in their countries of origin such as Eskom from South Africa that bought Uganda Electricity Generation Company Limited (UEGCL). Lastly, all SOEs assumed a legal form on registration after privatization. The dominant ownership type, however, was the local-foreign pattern. The dominance of local ownership over foreign, in terms of numbers sold, was explained by political interference and a policy of local entrepreneur development. Government preferred Ugandans to foreign Investors - a situation that tended to contradict foreign direct investment (FDI) promotion efforts as shown in the sale of Uganda Grain Milling Company (UGMC) and Entebbe Handling Services (ENHAS).