Kampala, Uganda | URN | Uganda President Yoweri Kaguta Museveni has met the trade delegation from Kenya who are on a working visit to Uganda over efforts to revive the trade relations between the two countries.
The officials from Kenya started their week-long trip to Uganda on Monday 13, April 2021 with a meeting with their Ugandan counterparts, before embarking on a tour of the sugar factories in the country.
A source moving with the delegation said shortly after the meeting, they received a call informing them that the president would like to meet them during their stay in the country.
Johnson Weru, the Principal Secretary of State Department for Trade, Enterprise and Development in Kenya said that the visit is to, among other things follow up on what was agreed during the 18th December and March 2019 meetings between President Uhuru Kenyatta and President Museveni, aimed at increasing the amount of sugar export from Uganda beyond the COMESA protocol.
He recalled that the issue of whether the quota of 20,000 metric tonnes of Ugandan sugar that was eligible to enter Kenya had been resolved. Uganda’s sugar production has increased to about 560,000 metric tonnes, out of a capacity of more than 600,000, compared to a local consumption of only 360,000 tonnes per year. Uganda therefore has a surplus of 190,000 tonnes which can only be put out on the export market.
However, all the tradition export consumers of Uganda’s sugar have frequently blocked or restricted the entry of the commodity into their markets for various reasons. While Rwanda blocked Uganda’s products two years ago, Tanzania and Kenya have instituted on-and-off bans of the sugar, and other products like grain, poultry and beef.
Some of the claims include that Uganda’s products are sub-standards and that Uganda imports some of the products, mainly sugar from other regions like Brazil, re-brands it and re-exports it to the region as Ugandan.
However, Kenya Minister for Agriculture Peter Munya says they have to protect the local industry too. “We have a duty to prevent over-importation and protect the local sugar industry which is being revived,” Munya told reporters.
He said that the Kenyan sugar industry has been affected by the failure of the government to privatize the factories, an exercise that has been fought by some politicians and the private sector. Starting April, 2021 the Kenya government also directed the sugar companies to increase the price of cane offered to the cane growers from Kshs 3,700 (Ushs 125,400) to Kshs 4,040 (Ushs 136,900) per tonnne, to encourage local production.
The Kenyan factories have been facing low cane supply and this gave Ugandan farmers a lucrative market opportunity in Kenya, before the Kenya government banned cane imports from Uganda.
The verification mission will also ascertain whether to increase the quota of Ugandan sugar imports into Kenya from the current 30,000 tonnes to 90,000. The Verification Mission will visit factories including Sezibwa sugar factory, SCOUL sugar factory, FM sugar factory, Mayuge sugar factory and Kakira sugar factory.
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Others are Kaliro sugar factory, Kamuli sugar factory, Bwendero sugar factory, Hoima sugar factory, Kyenjojo sugar factory, Kiryandongo sugar factory, Atiak Sugar factory and Victoria sugar factory, among others.
The Joint Verification Trade Mission will not only involve the sugar verification exercise but also tackle other market access challenges in areas such as poultry, maize and dairy products.
Uganda exports sugar worth Ushs 350 billion a year, but this dropped to just over 200 billion, last year, before starting to rise as more sugar went to the Democratic Republic of Condo.
According to the Association of Sugar Manufacturers, the country is stuck with sugar worth Ushs 168 billion.