When idi amin dada took control of Uganda in 1971 the Ugandan economy was
already in a declining state due to the mass exodus of Asians. An estimated 2000
asians were leaving a month in by the end of 1970. This mass exodus was due to
the Milton obote nationalization policies in which the government would acquire
60% ownership of all banks insurance firms,oil companies and indusrial firms.
These businesses were mostly owned by Asians. Another reason for the mass
exodus was the immigration act issued at the same time. This act meant that all
non- citizens had to get work permits. These two acts were introduced to allow
obotes government to have more control over the economy. The mass exodus of
Asians caused a vacuum of skilled workers and abandonement of businesses
resulting in a declining economy
However idi amin contrived to worsen ugandas economic state by mass
overspendings by mass overspendings for military purposes. As idi amin was
formely an army man he was naturally interested in military affairs and wished to
make Uganda to make Uganda well armed and secure. He wanted to do this as
he wanted ugandas military to portray Uganda as a strong nation thriving
independently.Between 1971 and 1977 amin increased the number of personnel
in the army to 21000 (almost twice what it was in was in 1971. During his first
year as leader amin also spent 20 % of recurrent and about 45% of
developmental expenditures on the military. His expenditures on the military
were much higher than obotes government. This overspending resulted in the
GDP declining further in 1971 and the real growth rate was only a meer 2%.
Uganda poor economic state left amin needing to take action and also a
scapegoat which he found in the Asians. amin decision to expel the Asians in
1972 to expel the Asians in Uganda was almost as bizarre as it was catastrophic
for the economy. The 1973-1973 budget released in in june 1972 showed the
need for mojor cutbacks and taxing on consumer goods. However idi amin took
no heed of this instead he gave the Asians in Uganda 90 days to leave the
country. He did this as he claimed to see in a dream that the asians were a
problem. However the real reason for his expulsion of the Asians are thought to
be his need for a scapegoat for the poor performance of ugandas economy under
his rule. Also he was trying to further populerise himself by appealing to the
ethnic Ugandans as there was a history of indophobia in Uganda pre dating
amins rule. This history of indophobia began when during the 19 th and 20th
century when Asian immigrants came to Uganda and began to set up
businesses. This meant that by the mid 1900s the vast majority of ugandas
businesses were owned by Asians. The ugandas disliked the Asians attitude
towards them and the dominance of Asians in businesses and industries enraged
them. Amin claimed he was taking the power from the Asians and giving Uganda
back to the ethnic Ugandans
we are determined to make the ordinary Ugandan master
of his own destiny and above all see that he enjoys the wealth of his country
our deliberate policy is to transfer the economic control of Uganda into the
hands of of Ugandans.
The expulsion of the Asians from Uganda was disastrous for the economy as the
Asians played a huge role in the Ugandan economy. Most buisnesses and
companies were owned by Asians meaning that many of the businesses
previously owned by Asians were forced to be abandoned as(despite amin
profusely advertising the businesses(he put728 buisnesses up for sale in local
press)buyers were few as most ethnic Ugandans lacked the expertise to run
these businesses. This led to the abandonment of many businesses. The
expulsion o f the Asians also meant that there was a huge shortage of skilled