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Archive for the tag “Peter Nyombi”

Kakira Sugar Limited addressing farmers strike (02.07.2018)

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Hon. Otto Odonga: Notice of Motion to Censure Betty Amongin over abuse of Office (23.05.2018)

The NRM Way is Corruption, so please don’t be shocked when they do it!

You should never be shocked if a National Resistance Movement (NRM) Members of Parliament (MP) or Historicals are caught eating of the public plate. No matter who it is, they are acting as they are entitled to this. They are entitled not pay rent, they are entitled to grab land and entitled to get kickbacks on government contracts. This is the system the NRM has built. To say otherwise is naive. This is the continuation of the “pay-to-play” system that Amama Mbabazi was known for. How do you think him and Gilbert Bukenya made their wealth?

They did not sell Nile Brew on the streets of Kampala, no these two used their positions to eat and therefore was synonymous with the word corruption, at one point they could have their face in the dictionary as they we’re always connected with some sham transaction. The same can be said the Foreign Affairs Minister Sam Kuteesa, who always has some shady business deal or arrangement to make sure his pockets are fat. When the new generation of NRM MPs see how the old-guard did it. They want to be in on it. That is natural.

So when Betty Amongi does what she does, she has learned from her peers. Not that is right or by law, but by the activity of the party. The same can be said by Evelyn Anite, whose also has some shady deals now. Both of these are just the newest crop, in addition to the ones who has already played these games. I am just waiting for Frank Tumwebaze to have some sort deal with the Telecoms, so that he could earn something on the side with this Sim-Card Saga of his. That would have made sense and also within reason.

And we know the likes Jim Muhwezi and others has made enough fortunes, big enough homes, that is why the house of Gen. Elly Tumwine, whose trying to outshine the Gbadolite, the house of former Dictator Mobutu Sese Seko. Therefore, the NRM elite has money, while the government lacks it and borrows to keep the cash flow going. If not, they are begging for handouts to secure government projects. This is happening while the elite is finding all kinds of tricks to find new money.

These are MPs with a lavish pay, secured pay for cars and housing, these are MPs whose already getting well-fed on the government tab. So they shouldn’t need to do shady backroom deals, but still they do, because the ones with much, always wants a little bit more. The rich wants to get richer. That is also natural, but they are feeding themselves on a rotten root and hoping the tree will bear fruits next season. Which is impossible, as they are killing off the tree, instead of nurturing it and making sure it can last.

The NRM eating like there is no tomorrow, it isn’t only the President. The State House and the PM. They are the main beneficiaries, but the MPs want their part of the pot of gold. That is why we see Presidential Handshakes, bribes, kickbacks, graft, land-grabs and whatnot. They all want their slice, because they want to be like the previous NRM ministers who did the same. They are NRM and therefore entitled to eat. That is the system. Not a beautiful masterpiece, but when the predecessors did it, why can’t they?

I am not saying it is justified, but I understand why it happens, why they are acting like this. Because they want their loot and their fortunes. If not they wouldn’t run as MPs or part of the elites. This is the way to get it. Not by hard work or dedication, no by association and by office. That is how this system work. This is 32 years down the road, and nothing has changed…

So please don’t be shocked, its put into play long time ago. That is why even Mwenda was bitching about this a decade ago, before his “independent” magazine launch. Peace.

Mzee complains today about waste, however he haven’t rehabilitated sugar industry or revamped pharmaceutical industry either!

“In this regard, we need to learn and apply lessons from emerging economies such as India, whose total healthcare industry revenue is expected to increase from US$ 110 billion in 2016 to US$ 372 billion in 2022 in response to deliberate investments in telemedicine, manufacturing of medicines and health technologies, medical tourism, health workforce training and risk pooling/health insurance, among others. In order to achieve this, we need to plan in a harmonized way. In Uganda, for instance, we, indeed, have a nascent pharmaceutical industry producing Aids/HIV, Malaria, Hepatitis-B, pharmaceuticals, etc. drugs. These are, however, still using imported pharmaceutical grade starch and imported pharmaceutical grade sugar. The pharmaceutical grade starch and sugar are crucial for making tablets and syrups for children’s medicines. Yet, the starch is from maize and cassava and the pharmaceutical grade sugar is from sugar. I am told the drugs would be 20% cheaper. Moreover, apart from helping in the pharmaceutical industry, more refined sugar is also needed in the soft drinks industry. Uganda is squandering US$34 million per year importing refined sugar for the soft drinks, about US$ 20 million for importing the pharmaceutical grade starches not including the other raw materials, US$ 77million for taking patients to India etc. Africa is incredibly rich but wasteful” (Yoweri Kaguta Museveni at THE OFFICIAL OPENING OF THE JOINT EAC HEADS OF STATE RETREAT ON INFRASTRUCTURE AND HEALTH FINANCING AND DEVELOPMENT, 22.02.2018).

Seems like the 1980s World Bank loans to restart Kakira Sugar Works hasn’t done enough, since the Ugandan state did right after the National Resistance Army takeover of the state. They went into an arrangement with the World Bank getting loans for the company, to restart. That deal was done 8th March 1988. As the documents said back in 198:

“Uganda currently imports US$15-20 million worth of sugar annually, which ranks second only to petroleum imports. Import substitution through restoration of domestic production capacity is therefore a high priority and eminently justified given the considerable comparative advantage Uganda enjoys as a result of its landlocked situation. Conditions for sugar production at Kakira are highly favorable. Cane growing benefits from excellent soils, good rainfall distribution (requiring only limited sunplementary irrigation) and relatively low levels of inputs of fertilizers and pesticides. The project brings back to the Kakira complex the original owners who have a demonstrated ability to manage sugar operations at Kakira and elsewhere” (SUGAR REHABILITATION PROJECT, 08.03.1988).

Therefore, what the President said today, the Sugar Rehabilitation Project, which was done to stop the heavy imports of sugar and for consumption, has clearly not worked as projected. Since his own state is squandering their resources and not even following the loans to make the project work. That is my take on it. The president of 32 years has clearly mismanaged this and not finished his job. Since he hasn’t been able to rehabilitate the industry.

When it comes to pharmaceutical industry there massive challenges, not just the sugar starch for medicine coverage of the pills. Nevertheless, the whole arrangement, since the technology to operate these machines are imported, as well is the parts. Not only the sugar starch, but also the ingredients are imported too, than you have few companies who has automated manufactures, which makes hard to make medicine on a larger scale. It is also high operation cost, because of use of back-up generators because of blackouts and shortfall of electricity. Because of this, it is expensive to have cold storage of the medicine and have a storage for the final products.

So the Idea from Museveni that it is simple, it is the whole system around it, that makes it more profitable to import ready made medicine, than actually produce it. Even if the added value of production would be there, but with the circumstances put by United Nations Industrial Development Organization, seemingly it is from 2009. However, the state of affairs hasn’t changed that much.

We can really estimate, that the adjustment and the needed organization to pull forward both industries during the years of NRM hasn’t been totally fruitful. If so, why would he complain about the imports of sugar and medicine, when he hasn’t been able to make it function with his 32 years of reign? Someone who has 3 decades, should have the ability and time to find the information, finalize plans and execute as seen fit. That is if he cared about the industries in question and their possible engines for growth and riches of Africa. Nevertheless, he hasn’t cared and haven’t used the time wisely. He has used the time bitching and not acting. That is just the way things is and it isn’t becoming better either.

He could have made sure that the pharmaceutical industry had energy, had the sufficient organization behind it to make the medicine, not only import and assemble certain medicine, he could have made sure the sugar industry was profitable and had the equipment to make the refined sugar used in the pharmaceutical industry. However, both is a lost cause, because it takes money and time. Both, is something he doesn’t have, since the narrative isn’t making him wealthy.

Alas, he we are at the status quo, with a President running for life and complaining about waste. When he has wasted 32 years and not made effort to change it. It is all talk and no fire. Peace.

Opinion: Mzee don’t want to bother foreign investors with taxes, just give him a Presidential Handshakes!

Well, I am biased, as the President are visiting Dubai for 4th Global Business Forum on Africa on the 2nd November 2017. President Yoweri Kaguta Museveni is trying to cater to foreign investors. People who he usually cater to at the State House, so he can get favors and Presidential Handshakes. That is why he isn’t bothered with taxes, because the tax-holidays and possible offerings will be huge for the investors who comes in. That is what the National Resistance Movement (NRM) are doing, especially if it is for instance a nations offering the state loan, than the same state can come with state-companies to build infrastructure like Chinese companies coming in after offering loans to the same NRM government. Therefore, just look at what he was saying yesterday, which is weird, but fit a pattern.

Since you are business people, we must be talking about profits. When you talk of Uganda and Africa, you are talking about peace as an enabling environment; which we have. We have raw materials, and have a population of 40 million people that’s’ a market. And if we talk of integration we have a four tear market” (…) “In Africa, the demand is there and growing because we have been under-consuming while the rest of the world the demand is falling because they have been over consuming” (…) “There are plenty of raw materials, minerals, tourism and so on so when you invest there you have access to all these” (…) “I don’t have to bother investors with taxes, what I want is for them to invest, use our raw materials, create jobs, add value and promote exports” (State House Uganda, 2017).

Well, so the President trying to say to foreign investors, you don’t need to pay taxes for your output, just cater to me. The state you don’t have to bother about, just bother about catering to the State House and me. We will add value and promote exports, we will agreements and make sure you get the value on our resources and low-payed workers.

We know who is the biggest taxpayers in the republic, because of Uganda Revenue Authority own statement in the media on the 31st October 2017, which stated names like Mr. Alnasir Virani Gulam Hussein Habib, Dr. Sudhir Ruparelia, Mohammed Hussain, Nakayima Janat, Karia Minex, Karia Kunnal, Alykhan Hudani and Dayalijil Karan. Who are sounding like foreign investors and they are on the top 25 biggest taxpayers in Uganda. So the state has already connected families from abroad to invest there in various businesses. This shows there are already people who is not worried about taxes, but about the output of their companies.

Some of these investors has made big names, while others have worked more in silence. Still, this shows that the top earners even promoted by URA and Doris Akol. Proves how they are working, as there wasn’t that many own citizens on the list. That shows that the foreign investors must get a special advantage and special agreements at the state house for their dealings. Especially, considering how it has been done, just for tearing down markets in Kampala for own investors and financial agreements. This has been done and arranged from the State House without consultation with locals, neither KCCA or the renters of these markets. That is how the NRM and Museveni do deals in favor of him and if he get ill-gained funds, he will support the “development”. It is in similar fashion he exposes his intent in Dubai.

That the State doesn’t need taxes or need structures to facilitate for foreign investors, they just needs agreements with State House and then it is all fair-game. It is insane, but fits the Modus Operandi of the Musevenism and NRM regime. Give him a Presidential Handshake and you can operate as you want in the Republic. Peace.

Reference:

State House Uganda – ‘President Museveni woos Arab investors to Uganda “We have the raw materials, human resource and market”’ (02.11.2017) link: https://www.africa-newsroom.com/press/president-museveni-woos-arab-investors-to-uganda-we-have-the-raw-materials-human-resource-and-market?lang=en

Opinion: It’s ironic that President Museveni is talking about disciplining the government!

The three arms of government and their sub-branches must have discipline. For example I have been involved in disciplining the army. We should do the same for other sub-branches of government. If the Judiciary is also disciplined in fighting corruption, citizens will lead a good life. – Yoweri Kaguta Museveni on the 1st October 2017, State House Entebbe.

Its just one of these days that hearing the news and seeing the tweets of the President, makes me laugh and wonder if he listen to himself. He knows his system and has made his garden. The way the government steers and govern is because of his policies, his regulations and his support. It is not like there been other ruling for last 30 years in Uganda. The Republic has been under the control of Museveni and his National Resistance Movement (NRM).

The NRM has suffocated all other free-will and control. Therefore, Ministers, Members of Parliament and others seek guidance and funds directly at the State House in Entebbe. Even foreign investors meet there to make agreements. Everything is nearly sanctioned out there. The Discipline now is more on the narrow-minded government that is run from there. The institutions and the procedures are not so important. Since most things happening is with the words from “above”, meaning the President and his close advisers.

It is not rocket science to know where the benefactor or the reason for lacking structures. That is because government waits for their go sign by the State House, they are waiting for funding of the projects and institutions from the State House. The projects and the works of the State House and under the Prime Ministers Offices are the key organizations within this government. They might say all of the massive cabinet has part to play, but that is the facade.

Therefore, it is ironic for a man so controlling and so disorganized that it gives sometimes way to the unthinkable. Just like the Presidential Handshake, that was sanctioned by the State House, but taken form the wrong account. That was the problem for the President, not that the corrupt behavior was occurring on his watch. Its like he talks against himself. Because he has no problem speaking anti-corruption, but if corruption benefit his cronies – its fine and dandy!

I am not surprised by him at this point of time, its fit his narrative. He says what he expects and wants out of others, but the next day he finds a way to benefit or use the loyalty of his cronies. Not like he would have excepted the UCC not to listen and stop the suspended MPs to hit the airways and be broadcast on TV. He rather being himself on radio and in the spotlight, but will accept anyone else sharing the same space.

President Museveni is the proof of someone saying something noble, but doing opposite. He might say something insane, but act rational. Therefore, you never know where you have him. I will never believe him actually disciplining the government, if doing so. It means they are all blindfolded and following his guidelines. It does not mean building proper governance and protocol, neither is institutionalize the departments and ministries, it is all about his will and his stature.

When it comes to Museveni, discipline is about following him. Not building transparent and proper government institutions. Peace.

NRM Letter to President Museveni: “Re: Memorandum of Important Issues Affecting Our Party and The Running of Government under the National Resistance Movement” (03.03.2017)

Opinion: Tired of NRM apologists defending the record of President Museveni!

It is depressing, it is sad and it tormenting to listen and read the defenses of National Resistance Movement. The defense of the 31 years of rule, the rule of the for life President Yoweri Kaguta Museveni and his cronies. The cronies and their 10th Parliament, the By-Elections that are rigged in favor of the NRM Regime. The government of Uganda is totally controlled by the one in-charge, the President and kingpin.

The Parliament are following orders and making amends to seem to be different. Therefore, the results of elections are more to just show overpower, but not to have real elections. As the NRM sends buses and pays of villages with small-fees and commodities. There aren’t anything fruitful or sincere by the regime. The ones who put dissidents in the Nalufenya prison. Where they will be beaten, tortured and get ill. As well, as in the overcrowded prison in Luzira. The organized silence of opposition, as their rallies are filled with tear-gas and police brutality. If not the ones who are feared by the NRM are put on treason charges and called terrorists.

President Museveni with his patronage, his bloated State House, the massive cabinet and the Presidential Advisors. There certainly enough ghosts, fake bills and misuse of state reserves to write books ten times thicker than the bible. We can know by the lost trillions of the Petroleum monies, as the “Presidential Handshake” is a drop in the ocean. As the UNRA and other agencies has misused the taxpayers monies. This happens with such ease and lacking finesse, but the agencies looking into graft and corruption is compromised, because the ones leading it are loyal Musevenist.

That the government and budgets are bloated. That the financial and economic state is in deep distress, as the state is suffering from lacking provisions and revenue. As well, as they are struggling with the stop of donor friendly relationships. People’s and Foreigners trust in the leadership of Museveni has been dwindling. President Museveni are also already prospecting the revenue of the oil and petroleum, even before it has surfaced. Therefore, the future will also be compromised by the deals done today.

The defenders of the NRM now, does not believe in real democracy, as they defending the rigging and militant Movement. A President who has no trouble with killing and destroying to stay in power. The ones defending him has no trouble to stand by a man who empties the treasury and state reserves with no hesitation. As well, as the men and woman who stays by the regime, are easily taking land and resources, they are eating of the plate and selling it back to the Ugandans. This with impunity and without any consideration of the ones who loses their chances.

It is a nation who has a government, not based on merit, but on loyalty. The loyalty to Museveni and his agenda. The agenda to work for him and his ideas. Not work to develop the nation, but develop the estate of Museveni. The idea of real Movement is ploy from the master himself. He just needs shadows to work for him and for envelopes. Not a real party who deliver policy or working for the future Republic. No the Movement is now a shell used pounce out the empty ideas of greed, nurture of the estates of Museveni and of the staging the power of the old-man with the hat!

President Museveni and his apologists knows all of this, they live by this and has faith that this is ideal and the dream. That someone comes with empty promises and lives by the fake party celebrating the 1986 coup. The coup that overruled the government and the old constitution, that President Museveni couldn’t pigeonhole. That has he done to his own and plans to do it again for his 8th Term.

The apologists can say he created safety, but he also created warfare and civil-war to get to power. Some called it a revolution, other calls it a takeover. But with time it wasn’t for the idea of a people’s government, but more a government and state built around the revolutionary, who didn’t really believe in the words he spoke.

The ones defending him, is defending a lie and that for the sake of eating. Not for the benefit of the Republic or the public. The struggling public is pawns, they are just needed props now and then for the Movement. As they praise their master, as they know if they get to close or too ambitious they are surely losing their place. Therefore, all of them are loyal cadres, elite and patrons who surely basks in the pasture of the President. But really, they should know it is on borrowed time. No-one knows how long the patronage and military can be serviced, how long they can all live on the charade and the misuse of power.

Certainly, the President knows this too, therefore, he uses all ways to make sure and get people on board. Even if that lets people starve, let them cheat on food reliefs and even use refugees as bailing-out card on the struggling economy. That is solely made of the patronage and grand-corruption orchestrated from the seat of the President at the Okello House. He can created all sorts of schemes and manufacture new ways of promoting better agriculture or better yields, but it is all ploys of generating more funds for his own. Not for the public to earn or get better output of the seeds and seedlings. If so, than the agricultural should be booming after 30 years in power.

However, the defense of this will be in the patronage and by the spokespersons appointed by the President. These ones will make a fuzz and say the Opposition never was a viable option and never had the leadership to overturn the Movement. The Movement has always been the only option, they say and use new ways of saying so. But that doesn’t make it true, as the rigging and the intimidation is used to forge this facade. The flawless untouched ballots doesn’t exists, there has been all sorts of play to get the will of the President.

President Museveni, even detain opposition, he uses safe-houses and some like Sam Mugumya are detained in the Democratic Republic of Congo, with no plan of getting him home. Him and others are lingering abroad as the political prisoner lingers in uncertainty. This is the legacy of the revolutionary, who became the draconian and the militarized government who uses all means to stay. He uses all methods on earth, Machiavellian and Orwellian blended in a Yellow Color with no fear of repression… no fear that the Movement can be touched, but when the moment appear. Than the Ugandans shouldn’t lose it, because they have already lost so much in the name of Museveni. Museveni has stolen the past and the present. His men has rewritten the history and tried to become the grand hero, and the generations from the rebellion is dwindling away. The young generation only knows the folklore and should beware, it is not all what it seems. The ghosts are not only in the budgets, but they are haunting the President from the past. They are the ones he stole to gain power and to silence the opposition. These souls will ask in the after-life, why he did what he did to them and also why he punished their grand-kids. Since they all lead the same faith. They all got to feel the pain, with no mercy from the leadership controlled by the President.

That is why there are no defending a man like Museveni. He has used all tricks, even was able to deceive the west for decades to pay for his decadence. Certainly, he must laugh about the dumb-white men and their agendas. His grin must be wide thinking of all the sorts of cars, airplanes and ranch expansions that are paid by the friends of direct-state aid. They have kept his roof and his ammunition, to oppress and to relief his patronage. Therefore, if someone is defending this man. Think of his track-record and all the souls he has left behind. Peace.

Looking into the inflation of 1987 as the Sugar prices are rising in today’s Uganda!

We have had a wonderful collaboration with IMF since 1987. We have managed to control inflation. By controlling inflation, we have succeeded in preserving the people’s earnings” – Yoweri Kaguta Museveni (State House, 2017).

Well, there been many who has set similarities with the inflation and price shocks of the year 1987. The Republic of Uganda has been through their mess before. The government of Uganda and the National Resistance Movement/Army (NRM/A) had just taken power in 1986. This was a year after the coup d‘etat, which brought the NRA into power. President Yoweri Kaguta Museveni in collaboration with International Monetary Fund (IMF), which had agreements and Structural Adjustment Program (SAP), which promoted deregulation and less state control of the economy. This was also put forward to settle inflation and the deficit that the state had.

So, because some has put similarities between 1987 and 2017, as the prices has gone from about 3,000 Uganda Shillings (UGX) in 2016 and 7,000 Uganda Shillings (UGX) in 2017. There is clearly that there was problems in 1987, but whole another level. The Sugar Industry wasn’t established, the economy of Uganda needed export of coffee and this was the sole benefit of foreign currency into the economy.

Inflation in Uganda is running as high as 200 percent, and low prices to farmers serve as a disincentive to agricultural production in a country of rich soil and mild equatorial climate” (…) “At the center of the debate is the issue of devaluation. In its first year in office, the Government revalued the currency from 5,000 to 1,400 shillings to the dollar, saying that the move would make imports cheaper. But exports have become increasingly expensive. Devaluation Debated. Some hard-line nationalists in Government insist that the cost of devaluation would be devastating. The cost of such imports as sugar, cooking oil and soap would increase significantly, they say, making the average Ugandan even worse off than he is now” (Rule, 1987).

In 1987 the Uganda shilling was demonetizated during the currency reform and a currency conversion tax at a rate of 30% was imposed to further reduce excessive liquidity in the economy. There was an immediate drop in average inflation from 360.7% in May to about 200% cent in June. However, with the possible fears of complex and drastic currency reform, the premium shot up, representing essentially a portfolio shift to foreign currency, and possible capital flight, and suppressed inflation. The intended aim of the conversion tax, apart from reducing excessive liquidity, was to lend money raised through this tax to the government. This was to finance the budget deficit over a short period, rather than financing it through printing more money. Nonetheless, inflation shot up again within three months mainly due to renewed monetary financing of increased government expenditure, domestic credit expansion by commercial banks to meet coffee financing requirements and financing of the newly launched rural farmers scheme” (Barungi, P: 10-11, 1997)

Prices for sugar and vegetable oil (both imported goods) increased rapidly in the early part of the year, falling between May and August — replicating the pattern of the premium between the parallel and the official exchange rate. The subsequent fall in sugar prices and stability of cooking oil prices were due to greater official imports. Inflationary pressures on food prices have been aggravated by supply shortages on account of severe transportation problems” (World Bank; P: 36, 1988).

In October 1986, Mulema was replaced by Dr. Crispus Kiyonga, who has a medical background Kiyonga has a difficult task. The government’s finances are shaky at best. In an attempt to enable Ugandan citizens to purchase imported consumer goods, the government fixes their prices below world prices. This, of course, puts considerable pressure on the government’s finances: for example, in July 1986 the government imported $4.8 million worth of sugar to sell at subsidized prices” (Warnock & Conway, 1999).

Perspective from Kakensa: “Today sugar costs 7000/- per kilo. When Museveni came to power in 1986 each kilo was at 4/-(four shillings). Immediately he came to power he said Ugandan shilling had lost value, in 1987 all money was changed, not only changed but two zeros were cut off to give it value on addition to the 30% levied on each shilling. This means on every 100 shillings, you got 70cents. Those who had 100,000/- got 700/-” (Kakensa Media, 12.05.2017).

We can see there was certain aspects, but the sugar industry now is different. The Sugar factories are now real and the business are now in full affect. While, in 1987 the state needed coffee exports to get funding and foreign currency. The sugar was imported and was put on fixed prices. The inflation back then was because of the crashing economy after the bush-war and the effects of it. The Sugar prices now are rising for different reasons. These reasons are the yields of sugar-cane, the hoarding of sugar and the export of surplus sugar. Also, the production of ethanol and bio-fuel. That was not the situation and context in the past.

Still, history is repeating itself, since the NRM, let the prices run as crazy in the past. The price has gone up a 100% in a years time. Which, means the prices who doubled from 3000 to 7000 Uganda Shillings. This is not a stable and the ones who get hurt is the consumer and Ugandan citizens. Peace.

Reference:

Barungi, Barbara Mbire – ‘EXCHANGE RATE POLICY AND INFLATION: THE CASE OF UGANDA’ (March 1997).

Rule, Sheila – ‘UGANDA, AT PEACE, IS FACING ECONOMIC BATTLES’ (28.01.2017) link:http://www.nytimes.com/1987/01/28/world/uganda-at-peace-is-facing-economic-battles.html

State House Uganda – ‘President commends Uganda – IMF collaboration since 1987’ (27.01.2017) link: http://statehouse.go.ug/media/news/2017/01/27/president-commends-uganda-%E2%80%93-imf-collaboration-1987

Warnock, Frank & Conway, Patrick – ‘Post-Conflict Recovery in Uganda’ (1999)

World Bank – ‘Report No. 7439-UG: Uganda – Towards Stabilization and Economic Recovery’ (29.09.1988)

A look into the rising Sugar prices in Uganda!

I commissioned a state-of-the-art ethanol distillery at Kakira Sugar Factory in Jinja today (Museveni, 23rd January 2017)

There are various of reasons for the rising prices of Sugar and processed sugar in Uganda. This isn’t the first time or last cycle of inflation on the prices of this common commodity. Sugar is common in Uganda for concept of having in it in the chai or the milk tea. To sweeten the milk and the black tea the Ugandans drink. Therefore, the Ugandans are needing and using lots of it on daily basis. It isn’t a luxurious goods, but a daily usage, for ordinary use. It has become staple and is staple together with matooke, cassava, rice and maize flour. This is all seemed as basic for the Ugandan people. Sugar is something very important. Therefore, the rising prices says something is out balance.

The balance have now been lost a year after the election. The prices of goods and food was also rising in 2011, therefore, the Republic had the Walk 2 Work demonstrations. These was demonstrations against the rising food prices, which also meant the sugar at that time went up. The same is happening now. With also on alternative exception, that the producers are not only creating sugar for consumption anymore, but ethanol and bio-fuel. Therefore, the produce and profits are going to export bio-fuel and other products, instead of the sugar that the consumers in Uganda uses. This also is an explanation for the rising prices, as well the added exports to Kenya, where the producers gain more selling it there. Than in Uganda, take a look!

In April 2017 USMA commented:

Uganda Sugar Manufacturers Association (USMA) says the increase in sugar prices has been prompted by the increase in cost of production and the deprecating shillings against major currencies. The Association’s Chairperson, Jim Kabeho says sugar millers were forced to announce what he called a paltry 4 percent increase on each 50-kilogram bag on ex-factory price. The increase according to Kabeho saw a 50-kilogram bag of sugar trading at one hundred and eighty five thousand shillings up from one hundred and seventy thousand shillings” (…) “Meanwhile a source at the Ministry of Trade Industry and Cooperatives who asked for anonymity says the Ministry suspects that the big players like Kakira could have decided not sell its sugar to the market so as to increase production at the ethanol its ethanol plant. The sources says sugar mills with ethanol plants are finally making money on sugar through on co-generation of power, alcohol and ethanol” (URN, 2017).

In April in Masindi:

Masindi district leaders have risen up against the Masindi district Resident Commissioner, Godfrey Nyakahuma over stopping sugar cane buyers from buying cane from Masindi district. Last week, Nyakahuma launched an operation of impounding trucks of all sugar cane buyers who buy sugar cane from Kinyara sugar limited out growers and over five trucks loaded with cane were impounded by police” (…) “Byaruhanga added that that is a sign indicating that Kinyara sugar Factory has no capacity to crush the available sugar cane adding that since Uganda has a liberalized economy let everyone come and buy the abundant cane available instead of leaving the farmers suffer with the monopoly of Kinyara sugar factory. Amanyire Joshua the former mayor Masindi municipality said that if Kinyara is saying that sugar cane buyers are poachers, Kinyara sugar factory is a smuggler because it is also doing the same. Mary Mujumura the deputy speaker Masindi district blamed Byaruhanga Moses the presidential advisor on political affairs for failing to advise the president on political issues saying that he is not supposed to enter into business matters” (Gucwaki, 2017).

In May 2017:

From last year’s average of Shs 3,000 per kilo of sugar, the price shot to Shs 4,000 early this year and is now hovering over Shs 5,500. A kilo of Kinyara sugar is the cheapest at Shs 5000, while Kakira sugar is selling at 6,000 a kilo. On the shelves, Kakira sugar and Lugazi sugar are scarce compared to Kinyara sugar, which is in plenty. Many dealers have now started hoarding sugar in order to benefit from anticipated price hike in the short term” (URN, 2017).

In May 2017 – Stanbic Statement:

The only category to buck that trend was wholesale & retail, where staff costs rose and employment fell. Average purchasing costs also rose in April, reflecting increased prices for animal feed, food stuffs, raw materials and sugar. Higher cost burdens were passed on to clients, leading to a further increase in output charges” (Stanbic Bank, 2017).

President Museveni praises Kakira Millers:

I would like to thank the Madhvani Group, despite the disappointment by Idi Amin. The family pioneered the production of sugar in Uganda. By 1972 they were producing 70,000 tons but today they have almost tripled the production to 180,000 tons,” he said. The President was today commissioning a state of the art ethanol distillery at Kakira Sugar Limited in Jinja district. The US$36 million facility, which is the largest in the East African Region, will be producing 20 million litres of ethanol annually” (…) “President Museveni pledged to address the issues to regulate the sugar industry but urged the Madhvanis to partner with farmers with large chunks of land for production of sugar-cane, as the cane is not a high value crop. He said people with small land holdings should be left to do intensive farming like the growing of fruits that give high returns. Turning to the issue of prices payable to sugar-cane out-growers, President Museveni advised the buyers and out-growers to sit together and agree on the prices taking into consideration the market prices globally” (Uganda Media Centre, 2017).

Government statement on the 11th May:

Speaking to 256BN on condition of anonymity a government official monitoring the situation said the manufacturers have not increased the factory price, but he conceded that the situation is worrying. “At the factory prices are stable. Why is it that the prices at the retail gate are high. This means that there are some distributors who are using the hiding strategy in order to rob Ugandans. As Government we shall continue monitoring the situation until we come up with the solution” the official said. Affordability of sugar is considered a key barometer of an ordinary person’s well-being and its pricing can take on political dimensions when people cannot have sugar with their tea” (256BusinessNews, 2017).

Putting the price in pespective:

Kakensa Media reported this today: “Today sugar costs 7000/- per kilo. When Museveni came to power in 1986 each kilo was at 4/-(four shillings). Immediately he came to power he said Ugandan shilling had lost value, in 1987 all money was changed, not only changed but two zeros were cut off to give it value on addition to the 30% levied on each shilling. This means on every 100 shillings, you got 70cents. Those who had 100,000/- got 700/-” (Kakensa Media, 12.05.2017).

This is all proof of a systemic malpractice, where both export, together with lacking yields because of drought and also the production of ethanol and bio-fuel. All of this collected together are reasons for the rising prices of sugar. The sugar price goes up because the use of cane for other things than millers producers sugar for consumption, but for other export products. This is all making sure even as the Republic of Uganda has in the past produces to much, it now doesn’t. Since it elaborately uses the sugarcane for other products.

That has made the Madhvani Group rich and their exports of sugarcane products are clearly selling. Now even their basic milled sugar are sold more expensive on the Ugandan market. There are also proven problems by other millers, who either has to much cane like Kinyara Sugar Factor in Masindi. Which is ironical problem, as the Kakira and Lugazi sugar is empty on the shelves, while the sugarcane hoarding Kinyara are still in the shops. But Kakira which is produced by Madhvani Group, we can now understand, since they have bigger operation and is blessed by the President for their industrial production of ethanol and bio-fuel.

Therefore, the are more reasons than just shopkeepers not getting enough stocks. That the rising prices are not only that there is lacking production. It is the system of export and production. Where the cane isn’t only becoming milled sugar for consumption, but for all the expensive industrial exports like bio-fuel and ethanol. This is all good business, but also bad for consumers and citizens who are accustom with decent prices for their sugar. That is not the fact anymore, as the business and millers has found new profitable ways. So that the surplus sugarcane and also the other gains massive profits. This is all good business for the owners of the sugar-millers and sugar industry. The one who feels the pitch is the consumer and the citizens. Who see scarcity of sugar inside the shops and also the inflation of prices on the sugar. Peace.

Reference:

256BusinessNews – ‘Government to issue statement on sugar’ (11.05.2017) link:http://256businessnews.com/government-to-issue-statement-on-sugar/

Gucwaki, Yosam – ‘MASINDI RDC IN TROUBLE OVER STOPPING SUGAR CANE BUYERS’ (28.04.2017) link: http://mknewslink.com/2017/04/28/masindi-rdc-trouble-stopping-sugar-cane-buyers/

Stanbic Bank Uganda – ‘Ugandan economic growth continues at start of second quarter’ (04.05.2017) link: https://www.markiteconomics.com/Survey/PressRelease.mvc/143ca2b8e3d84c79b96aed4885b7337e

URN – ‘Sugar manufacturer’s association explains price hikes’ (14.04.2017) link: https://dispatch.ug/2017/04/14/sugar-manufacturers-association-explains-price-hikes/

URN – ‘Uganda: Sugar Crisis On for Another 2 Years – Manufacturers’ (09.05.2017) link: http://allafrica.com/stories/201705100129.html

Uganda Media Centre – ‘President Praises Madhvani Group’ (05.05.2017) link: https://mediacentre.go.ug/news/president-praises-madhvani-group

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