I hope this letter finds you well.
Judging from the reporting of your trip to Nairobi over the oil pipeline issue the Kenyan political establishment expects nothing less than an agreement to export oil through Lamu. The Citizen reported that the talks had“collapsed”, for example, even if an official statement claimed otherwise. Standard reported that Kenya would “go it alone” in the event that Uganda considered an alternative route through to the Tanzanian coast. They quoted Kenyan energy officials whose position appears to be that a pipeline through Kenya best serves Uganda’s interests.
Earlier, and ahead of your trip, The Star in a story “Uhuru to host Museveni for talks on Uganda-Kenya oil pipeline” did not even bother to mention the Tanzanian option. The publication carried a statement from Mr. Manoah Esipisu, a spokesman for President Uhuru Kenyatta who said your visit would lead to expediting the pipeline and “avoid any further delays in commercializing, especially Uganda’s petroleum resources, which were discovered nine years ago”.
It seems obvious to me, and perhaps others, that the Kenyan establishment think that Uganda really has no choice in the matter at all. If so, perhaps its important to address why they do considering that the route under discussion is widely known to have considerable challenges not least over the terrain, complex and deepening security problems, Kenya’s own promising but unproven reserves not withstanding along its path.
Speaking as if its fait accompli, a Kenyan official put the pipeline to me as a paradox between strategic neighbours; Uganda’s oil, Kenya’s infrastructure. This attitude that it is a done deal may not have by your pre-election announcement following a visit by Uhuru Kenyatta that the pipeline would go through to Lamu when in fact, after inquiry, I was told by government officials the matter had not been exhausted at that point. It is observable from the actions of our Kenyan brothers and sisters that they want this pipeline badly. The initial pipeline study was advertised by Kenya’s energy ministry (they paid for it) and Ugandan technocrats learned of this decision by reading Kenyan newspapers, as did I. There are many examples of this variety of proactivity since and its understandable but can nonetheless be separated from the question of if these actions amount to the same thing as Ugandan interest in the matter.
Seen from a Kenyan perspective a pipeline route as advertised through Lamu, part of the massive US$ 27 billion LAPPSET project makes long-term economic sense. It would set up Kenya as the evacuation hub for Ugandan, South Sudanese and possibly Somali and Ethiopian oil. In the short term LAPPSET is not only a strategic project for the Kenyan economy but also political gold for whoever sits in their State House as it would, if and when completed, be one of the most important national projects undertaken since Kenyan independence. It would likely spur an industrial surge over the next 15 years that would boost Kenya’s economic and market position. I am aware, and taken from your recent commentary in Kyankwanzi (Titled Geopolitics, Regional Integration and National Interests), that you believe growth in Kenya’s purchasing power is great for the common market and good for Ugandan producers. While this analysis and its ideological roots may hold true, so does the fact that in the interim, the lack of reciprocal leverage over Uganda’s eastern neighbour and its economic might, will not always be strictly in the national interest.
It is not rocket science that routing both commercial traffic and oil through Kenya would give Nairobi near total influence on economic matters and would, added to Kenya’s already considerable market penetration in Uganda, leave little wiggle-room for unforeseen and some predictable hazards. The Ugandan domestic commercial and industrial community as well as consumers remember well how helpless they were when disruptions followed the Kenyan election of 2007 (even when some of us had urged the government earlier to restock fuel in anticipation of political violence). Many also live with the challenges of a single port to our import-addicted economy and the cost to family fortunes whenever Nairobi pulls bureaucratic red tape. Obviously being landlocked is not a “non-issue” as you framed it in Kyankwanzi. It needs to be placed in a detailed context. I have some reservations over your optimistic take on political and market integration, and that said, clearly having one member, in this case Kenya, within this greater EAC community with more power and influence than the rest is not an advantage to the growth of the community and may in fact prove rather dangerous. This as I recall has been the common fear cited in our neighbourhood about Uganda’s aggressive military spending (to which the Kenyan government responded with its own expenditure in the decade ending 2018)
One view, which if Uganda decides to build a pipeline through Kenya would become a reality, is that we would have to increase its military spending to counter the leverage that Nairobi would have. This would be because in strategic terms, regardless of the political commitment that the present Kenyan administration would have, Ugandan policy must consider its neighbour hostile. This unfortunately is not a viable or sustainable affair, however appealing it is to the defence sector, which also remains one (in both countries) with little or no civilian oversight. Hardware and boots can protect Uganda’s strategic national interests as part of coherent strategy but policy makers should consider this as savings where strategic diplomacy can serve instead. If the opportunity exists to forego such expenditure, it does not disappear altogether but rather these “savings” go into agriculture, industry and trade as well as infrastructure. In other words they reappear as investments into a different kind of security, normally termed human security.
Perhaps let me reference two aspects of the Ugandan oil sector I am familiar with in this regard. First, 2017 will mark 10 years since I filed a freedom of information case to compel the government and the oil sector to embrace greater transparency. It was a landmark case then and my argument at the time was that transparency is necessary to herd off future distrust and unrest linked to how Uganda manages its oil. I stand by that argument and time as shown that positive pressure on the government and its response, no least your own efforts to share with the public the government’s actions, have helped earn trust in its policies in the sector. Uganda is safer for it and along the way it has learned, at least in the oil sector, that the nationalist policies that were claimed in public were also true in agreements entered on their behalf. The government too has hopefully understood that its position can be bolstered by an understanding and informed public that may have ideas to offer to any common enterprise.
Secondly, and while the battle for transparency continues, it is my belief that unlike other oil sectors in Africa which were designed from the start to be external sectors (oil for export), Uganda’s agenda will eventually hinge on a domestic sector, to the extent and channelling your own views here, a local sector within the meaning of evolved regional markets. A local refinery, even a loss-making one initially, to embed industry, supply markets further afield and a pipeline. That pipeline route cannot be through Kenya for the strategic reasons outlined and this position need not be construed as inconsistent with the broader EAC agenda but rather beneficial to it. Rather than invest in an unstable and expensive route, one that would create, not reduce tensions, between Kenya and Uganda, the alternative pipeline to Tanga would give us access to a new port and expand options for trade with Tanzania. This will include import and re-export of Tanzanian natural gas which Uganda badly needs for cheaper cooking energy. Kenya, in the meantime, can supply its own oil to the cost by rail or pipeline cheaply but also buy more time to be more deliberate about its LAPPSET project. This project may yet bear fruit but actually needs investment from EAC member states at a time when they are able to make that investment. This moment can be said to have arrived after some of the security challenges in Somalia/Ethiopia and in Southern Sudan have resolved enough to bring their extractive sectors more realistically into the common market.
I expect you and the government would have little difficulty therefore in supporting a southern oil pipeline route through Tanzania.
