Briefing Document / March 15, 2011

Joint letter to DfID outlining need for donors to address transparency in Ugandan oil sector

Uganda is on the verge of a petroleum windfall. According to the World Bank, revenue from this industry has the potential to double government revenue within six to 10 years and to constitute an estimated 10-25 percent of gross domestic product at its peak.  If managed well, this money could lift Uganda from one of the world’s poorest countries to middle-income status. Unfortunately, the current governance trend-lines in Uganda are in decline – underscored by a number of high-level corruption scandals in recent years – and the desired good-governance foundations for the management of Uganda’s natural resource-base appear shaky. With five to 10 years before revenues from the country’s oil begin to flow, research has also highlighted number of early warning signs for governance of the petroleum sector.

Global Witness and Ugandan civil society partner CSCO have written to the Department for International Development to outline the urgent need for Uganda's development partners to address governance concerns surrounding the industry, with a view to realising the resource’s developmental potential. The upcoming review of Uganda’s budget support framework on the 15-16 March provides an important opportunity to do this.