The fire that destroyed Jinja market on April 14, 2002, led to a loss estimated at $490,000. This and other disasters like drought, landslides, floods, earthquakes, cattle rustling rebel activities, etc. have resulted in loss of lives, property, environmental degradation, and poverty.
According to the Uganda Police annual reports, the number of fires in Uganda in 1994 was 346 with an estimated loss of $497,000. In 2000, they increased to 499, with an estimated loss of $1.74 million (a 44 percent increase). In 2002, fires engulfed educational institutions, factories, plantations, shops, hotels, warehouses, and markets – including the Mbarara Central Market (MCM) on July 18, 2002. The loss in human life was estimated at between 60 and 70.
These have served as a reminder that government, companies, and individuals alike should have a contingency plan in place. What has been the impact of such disasters? How can companies plan ahead to protect their staff and properties? To demonstrate this, the inferno that destroyed MCM has been used because of the magnitude of destruction estimated above $1.89 million.
MCM was constructed during the 1960s. As the population in Mbarara increased, especially after the 1979 liberation war, the demand for business premises rose and this prompted the Mbarara Municipal Council (MMC) to allocate the open spaces inside the market to developers. In 1999, when the “old market” was renovated by MMC, the business population in the central market doubled.
This study was undertaken to describe the disasters in Uganda and to investigate their impact on companies and individuals with a view to making recommendations for coping with them.
The report is based on information gathered during interviews and discussions with administrators of MMC, banking institutions, security personnel, market traders, wheelbarrow pushers and petty traders. In total 116 traders were interviewed. In addition, a number of reports and studies on disasters were reviewed during and after the fieldwork. This helped to crosscheck with facts and facilitate the process of data analysis.
Results and Discussion
The results of the interview, literature review, and discussions revealed a great impact of the inferno on the companies and people. The impact was examined based on the effect of the inferno on the following: economic, human, social, political, and security.
The inferno of MCM dealt a very big economic blow to traders and their suppliers, the landlords, banks and micro finance institutions, and other business fraternities in and around Mbarara and Uganda. It directly affected town consumers who depended on the market for food, clothing, and job opportunities. Indirectly, it also affected the transport industry, hotel industry, farming, drinking, and other entertainment places.
The market had been the commercial hub of the town as a supply centre for retail and wholesale goods. It served much of western Uganda, Rwanda, Burundi and Eastern Congo. The traders in this market in turn were getting their goods from Kampala, Nairobi, Dubai, Hong Kong, China, and Thailand. Therefore, the economic impact from burning of this market has been devastating not only to the traders in this market but also to their clients. According to Municipal Council authorities, most of the 95 structures in the market – which included lockups, kiosks, and stalls – were destroyed.
Banks and Micro Finance Institutions
The study found that at least 80 percent of the businesses in the central market operated on loans acquired from banks and micro finance institutions. Both formal and informal creditors lost a lot of money. The informal lenders loss could not be quantified due to lack of documentary evidence. According to a 2002 Bananuka Report, the formal lending system – with a total of 417 clients – were affected involving a total of $276,640. The study further revealed that 61 percent of the clients were those who got loans from micro finance institutions, the rest from commercial banks.
Other financial institutions that cater to larger corporations had no direct cases in the inferno but felt the effect of the loss of the market in their business. The loss of cash reduced money in circulation, which lead to the fall in deposit levels for the months of January and February 2002.
The market had been one of MMC’s major sources of revenue, collecting about $83,200 per year. With graduated taxes and other license fees, the council lost almost $112,000 per year from the market. The implication of this is that the inferno will have a great impact on service delivery of the municipality.
There were other indirect economic effects reported. Uganda Revenue Authority reported that 255 taxpayers were operating in the market. Secondly, the loss of stock was to be offset when calculating value added tax.
There was a remarkable decline in the sales of petroleum products, particularly in January and February, as drivers were not as busy as they used to be. It is estimated that 80 percent of the traders in the market and their customers were using “bodaboda” (two-man bike taxi) as a means of transport.
Hotel & Restaurant Industry
The hotel industry – particularly those with restaurants around the central market – suffered greatly, with income dropping by as much as 30 percent. A good example is the Western Restaurant, which is adjacent to the market. The proprietor said, “I used to slaughter 15 chickens a day, but now I slaughter only five.”
However, there are some organizations which gained a lot from the situation, thus reaping circumstantial benefits. These mainly included mobile phone companies, hardware companies, and surrounding markets.
The market had been a place of employment for hundreds of people. An estimated 263 landlords earned $14,611 in rent from lockup shops and kiosks. Others rented food stalls and even open spaces on “goodwill.” In turn, there were many people who were involved in the supply of services.
It was a time of grief, depression, and pondering what the future had for them for most involved. However, the inferno became an opportunity of gain for looters and politicians who used the incident for political capital.
Socially, the inferno was a source of confusion, blame and counter blame among the victims. Another impact, felt shortly after the inferno, was that the various social gatherings that occurred in the many drinking places in Mbarara town dropped drastically. Bars that usually closed at midnight started closing by 9 p.m.
The market was the source of livelihood for many, therefore the inferno left the majority of the people desperate without any source of income. It was reported that one trader went into shock and eventually became deranged after learning that his goods and cash had gone up in flames. Medical and religious authorities reported people coming to them with shock, apathy, despair, panic, and many in need of counseling. There was a lot of fear that banks would auction assets that traders had mortgaged as security for the loans.
Many residents had problems paying school fees for their children’s education. Several children were forced to transfer from quality schools to poor ones. The issue of school fees became so touchy that the MCM fire victims’ verification committee report recommended that the government require school authorities to allow fire victims to pay school fees in installments.
Since the market comprised of merchandise like batteries, caustic chemicals, and insecticides, the fumes and dust from them polluted the environment and affected the current and future health of the population. The health effects of this fire will be felt even greater in the long run.
The inferno occurred during a time of campaigns for local government council positions at various levels within the municipality and Uganda as a whole. Some people were quick to gain political advantage by attributing the inferno to their political opponents. Several respondents associated the fire with the local politics and poor planning.
Poor planning allegations took their toll on the incumbent Kakoba Ward counselor, who was the chairman of the traders of the market and the mayor. Both lost elections by unexpected large margins.
Challengers campaigned that the market was constructed with highly inflammable materials. They contended that these “match box” structures contained goods such as cooking oil, plastics, chemicals, and other highly inflammable goods that enhanced the destruction of the market. Government, on the other hand, was blamed by some respondents for not honoring its pledge of constructing a modern market in Mbarara town.
There were many speculations and theories about the cause of the fire. A security committee was formed by the district authorities and was given 10 days to investigate the cause of the fire. This committee has not come up with any conclusive causes.
There was also a fear that people who were totally dependent on the market for their livelihood – namely the wheelbarrow pushers, casual laborers, some traders, and school dropouts – would become a security threat to Mbarara and Uganda in general.
Coping With Disasters
Planners, managers, and individuals must have a contingency plan to avoid repetition. Here are some suggestions:
Training – Government should train every Ugandan to be ready for disaster like it trains people in military science commonly called “Muchaka-Muchaka.”
Developing a contingency culture – Companies and individuals need to accept changes that come as a result of disasters and have a built-in contingency culture to handle such changes. Therefore, contingency planning must become a routine task for all managers and individuals.
There is a need for the government to make fire brigade autonomous. Towns are growing in terms of infrastructure, population, technological innovations, etc., while the capacity of fire brigade department is not increasing in line with the anticipated fire disasters.
Examining security arrangements – Business managers need to re-examine the security arrangement that is in place to avoid such disaster. However, there is a need for concerted effort both by employees, customers, and management.
Instituting a risk assessment program – A regular risk assessment program is essential for disaster contingency planning. A risk assessment workshop is recommended to create awareness of the impact of disasters. If traders were keeping money in banks or some other place, this would have drastically reduced total losses by as much as $425,000 or 22 percent.
The property owners should have basic fire fighting equipment’s like fire extinguishers, and fire detection in their premises.
Disasters are unpleasant scenarios to consider and these fires have become part of our daily lives. When they happen they affect government, companies, and individuals. They have wide-ranging implications such as economic, human, social, political effects, and security matters. Every organization therefore should have a contingency plan that anticipates the possibility of a disaster.
Charles Tushabomwe-Kazooba is a lecturer in managment and finance at Mbarara University of Science and Technology in Uganda. He is a graduate of University of Birmingham Business School 1988.