Donors demand cutbacks in defence spending

Donors have called on the Ugandan government to cut down on its defence expenditure, which they say has risen to over two percent of GDP in the current fiscal year, compared with the 1.9 percent budgeted for. An analysis by 'Oxford Analytica' found out that the government's war against domestic insurgent groups, together with its military involvement in the Democratic Republic of Congo, had resulted in an increase in defence spending from US $150 million in 1997-98 to US $350 million in 1999. Diplomatic sources confirmed to IRIN that this had caused concern for some time, because "it usurped funds designated for social welfare projects". Meanwhile, the British minister for development on Wednesday discussed the issue with Ugandan President Yoweri Museveni. "The [Ugandan] government made some commitment", a source at the British High Commission in Kampala told IRIN. Ugandan media sources pointed out that Kampala had been asked to close down the controversial Greenland Bank "which it did" and now "the president has also talked of pulling out of Congo". A senior official in the defence ministry denied there had been any over-spending. "There is no expenditure out of the normal, there is no evidence," he told IRIN. In March, the IMF threatened to withhold disbursement of US $18 million of a loan package approved in 1997 if Uganda failed to curb spending on defence. Finland, for its part, suspended aid to Uganda, while the Paris Club of donors has increased pressure on Museveni to make peace with Sudan as a means of halting rebellions in northern Uganda.