Study on Economic Partnership Projects in Developing Countries in FY2009 Study on National Database (National ID) in Republic of Uganda SUMMARY March 2010 Japan Telecommunications Engineering and Consulting Service NEC Corporation Marubeni Corporation
(1) Background and Necessity of this Project The Republic of Uganda, located in the central part of the sub-saharan East Africa, is an inland country and has an area of 241,000 km 2 and population of 30,660,000 (as of 2009), and per capita gross national income (GNI) of US $280 (as of 2008). Its GDP growth rate is 7.0% and has been changing steadily while increasing gradually in recent years. This is mainly owing to the fact that the government led by President Mr. Yoweri Kaguta Museveni has positively accepted the structural adjustment program of the World Bank and IMF and thereby promoted such policy measures as the liberalizing producer prices of agricultural products, abrogating the monopolization by public corporations of export products, privatizing state-run companies, and downscaling the public sector (central government ministries and agencies), among other measures. Thanks to these measures, its macro economy is stable as of this date. Yet, Uganda is still a low-income poor country (classification made by the World Bank). It formulated its Poverty Eradication Action Plan (PEAP) in 1997, which was followed by the execution of its current tertiary PEAP. Its successor document is the 5-year National Development Plan (5NDP) (under formulation), and this project is to contribute to the security of the human and the improvement of good governance in the plan. This project is to register national ID numbers and issue national ID cards to citizens as stipulated in the provisions of Article 16 (1) Article 16 (3) (a) of the Constitution of the Republic of Uganda, and thereby aims at building a system that can identify Ugandan nationals in a reliable manner and verify that they are Ugandan nationals, and thereby providing these nationals with a fair and equitable administration services (including education, health insurance, employment service, issuance of a passport/visa, and enrollment in the voting register) to improve the living standard of Ugandan national. In this way, the project is to lay the foundation to set the national ID card firmly in place as the social infrastructure of this country, and build a comprehensive national database that is committed to facilitating the national security as well as social, economic, and political development of Uganda. Currently, the Republic of Uganda suffers from problems, including 1) improper citizen management (such as no deletion of any person dead from the resident registration and no management in place of the place of residence), which hinders them from receiving fair and equitable administration services in the place of residence of nationals, 2) paper-based registration of residence (problem of loss and improper disposal) disabling authentication of nationals, 3) national information registered in multiple ministries, thus wasting some government budget, 4) double
registration of voters to allow one individual to have multiple voting rights (presence of ghost voters) and such other problems of illegal election, and 5) disability of managing illegal immigrants flowing in on the Ugandan border. To resolve these problems, building such national database is believed to be essential. In addition, the ministerial summit of the common market by the East African Community (EAC) consisting of East African countries (the five countries of Kenya, Tanzania, Uganda, Rwanda, and Burundi) has systematized the use of national ID cards in the entry-exit among these East African countries, which has given rise to an aspiration for development of a national database system forming the foundation of move of people among different countries (border control) through this project. (2) Basic Policies on determining the Details of this Project In line with the Constitution, and toward building a specific national database system, the Ugandan government has been conducting studies on the project implementation framework, financial resources and fund raising, and project implementing procedures, among other matters, in the Uganda National Population Identification and Verification Programme, Draft Roadmap (March 2009) (hereafter National ID Project Program ) under the leadership of Ugandan Ministry of Internal Affairs (MoIA). In addition, this project is stated in the Ugandan government s next five-year plan, namely the National Development Plan, and supposed to contribute a great deal to the priority areas of this program improvement of human security and good governance which includes improvement in the quality of administration services and improvement in the national living standard sought by the Ugandan government. (3) Project Overview This project is supposed to develop and build a national database, in line with the National ID Project Program, which contributes directly to the Ugandan nationals management operations. Such national ID numbers are issued to children given births with respect to newly born children, and for existing residents, staff members to perform the registration work are employed and the residents are registered in the national database, and issuance of the national ID cards targets all nationals aged 18 and over (approximately 17,170,000 individuals) and all foreigners staying in Uganda for three months or longer (approximately 65,000 individuals).
In addition, in the course of implementation of this project, work to be progressed in parallel includes the development of related laws, rules and regulations, establishment of Ugandan nationals incentives, educational activities (PR considering the human rights and appeal of the necessity of this project), and protection of information on Ugandan nationals, and ensuring information security that is safe and reliable against accesses. The scope of this project covers: 1) the system design of the national database, 2) provision and installation work of the system, 3) instructions and training at the time of system implementation, 4) technical support and instructions related to the registration and operation of the information on nationals, and 5) development of human resources for operation and maintenance of the system. It must be noted here that, to satisfy the requirements specified above, it is desirous to make use of a scheme of a technical cooperation project which should allow effective and efficient use of the knowledge and knowhow of Japanese companies. 1) The total cost of this project is supposed to be approximately 6.3 billion yen. The total cost is broken down as: approximately 3.4 billion yen for the equipment as well as the development, education and implementation; approximately 0.15 billion yen as the national ID card procurement cost; approximately 0.75 billion yen as the manpower cost; and approximately 2.0 billion yen for the operation and maintenance (annual cost). 2) Outline of preliminary financial and economic analysis results In the context of the financial analysis, if the income from this project is considered to be the charges for national ID card reissuance and charges for registration of foreigners, no Financial Internal Rate of Return can be expected. As such, the project cannot be turned into black by 2028, thus the Financial Internal Rate of Return (FIRR) based on this precondition is -0.22%. In addition, in the context of economic analysis, if the benefit from this project is set to be the amount equivalent to the government financial expenditure that can be cut by the implementation of the national database, this project will be turning into black in 2018. Note that, on this precondition, the Financial Internal Rate of Return (EIRR) of the entire project is 29.6%, which is considered to have good enough socio-economic effects. 3) Studies on the environmental and social aspects Regarding this project, studies have been conducted on its environmental and social impacts in accordance with the JETRO Guidelines for Environmental and Social Considerations, the JBIC
Guidelines for Confirmation of Environmental and Social Considerations, the JICA Guidelines for Environmental and Social Considerations, and the Environment Impact Assessment Regulation (assessment on the environmental impacts in the Republic of Uganda). As a result of these studies, since the IT equipment items to be implemented in this project are to be installed in existing buildings, no large-scale civil engineering and construction work is required to accommodate them, which is believed to give very little impact on the environment. Besides, NEMA has already conducted its environment impact assessment (EIA) with respect to the National ID Project by MoIA, and accordingly NEMA has confirmed that it is not necessary to conduct such EIA anew for this project. Meanwhile, this project requires adequate consideration to the issue of protection of personal information including the fingerprint information. The Uganda Human Rights Commission (UHRC) taking charge of managing the human rights has made clear its recognition, as a result of studies based on the business plan under MoIA, that the details of this project are in no way of such a nature raising human rights issues. (4) Project Implementation Schedule For the implementation of this project, the schedule shown in the National ID Project Program is under reconsideration, and at this point in time, a schedule extending over a period of five years is being considered in each of the work items below. The work details that are under study at MoIA are as follows. 1. Preparation of a policy framework and bill 2. Support for the preparation of the program 3. Work related to improving the awareness of Ugandan nationals 4. Commencement of this project 5. Conduct of sampling and trial 6. Identification of nationals, verification, registration, profiling, and acquisition of required information and data including fingerprints of nationals 7. Entry of national information and data in the national ID database 8. System verification work 9. Preparation of national ID cards 10. Delivery of national ID cards.
In the context of the work details mentioned above, the scope of this project covers: 2 Support for the preparation of the program, the system granting and installation work in 5 Conduct of sampling and trial, and technical instructions and support in 6 Acquisition of national information, and 7 Entry of national information and data in the database, and development of human resources for the operation and maintenance of the system. (5) Feasibility related to Request for and Implementation of Yen Credit The Ugandan government suffers a chronic shortage of budgets. As such, it is believed that the implementation of this project inevitably requires both financial aid and technical support from overseas. The Ugandan government is also requesting Japan for support in this respect. Assuming that the total cost of this project is 6.3 billion yen, and for the financial analysis purpose, the revenue from this project is the sum of the national ID card reissuance fee (2,600 Ugandan ceiling = approximately US $1.3) and the foreigners registration fee (80,000 Ugandan shillings per registration = approximately US $40), and the starting year of issuing the national ID cards is 2013, even in 2028, 15 years later, the profit and loss calculation result of the overall project is still in red. In addition, the Financial Internal Rate of Return (FIRR) is -0.22%, which means that no internal revenue can be expected in this period of operation. In the context of the economic analysis, assuming that benefit is the governmental budget that can be reduced through this project, and calculating the expenditure of the administration sector from the government expenditure data, the governmental budget in 2018 can expect the reduction effect of approximately 11 million US dollars, which means that the profit and loss calculation results is now in the black and the Economic Internal Rate of Return (EIRR) turns out to be 29.6%. As such, it is believed that the project has very large social and economic effects. From this, financial support through yen credit or economic support through grant-in-aid is appropriate. Note that for smooth implementation of this project, it is believed that technical support such as the Technical Cooperation Project from the planning stage is effective. (6) Superiority of Technologies of Japanese Companies This project requires personal identification of the very person when registering his/her information in the national database. In this regard, Japan s Automated Fingerprint Identification System (AFIS)
has won the evaluation of the top ranker for its extremely high technological standards of matching accuracy 99.9% and the number of fingerprint matching per day 70,000 cases in the Fingerprint Vendor Technologies Evaluation Project of the US National Institute of Standards and Technology (NIST). In addition, this fingerprint matching system enjoys superb track records of implementation at 350 sites in 30 countries. In implementing HANIS (Home Affairs Identification System), in particular, which the Ministry of Internal Affairs of South Africa Republic implemented in 2002 as a project similar to this project, the experience of implementing all the way along the system design, installation, implementation, and operation and maintenance, which may be fully taken advantage of in this project. (7) Specific Schedule up to the Implementation of this Project and Risks on the Way toward Implementation In the context of the National ID Project Program being pursued by the Ugandan government, they are closely studying, in its planning phase, specific ideas as the countermeasures along with the schedules for carrying them out with respect to the risk factors as pointed out below. 1. Securing funds for the promotion of this project 2. Development of relevant laws, rules and regulations (mainly for the treatment of the information on nationals) 3. Establishment of the incentives for the Ugandan nationals (motivation to willingness of making use of the national ID) 4. Consultations and agreement with stake holders 5. Educational activities (resolving human right issue, PR and appeal for the necessity of the system, and other such activities) 6. Ensuring protection of the information on nationals as well as safe and highly reliable information security against accesses 7. Securing places for installation 8. Securing human resources (such as project staff and individuals in charge of operation and management of the system) Note that, in the course of this investigation, we paid visits to the Uganda Human Rights Commission and the National Environment Management Authority (NEMA) and thereby confirmed that implementation of this project poses no problem at this point in time.
Map of Uganda