Uganda’s Ministry of Agriculture signs memorandum of understanding (MoU) with 2 UK companies

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The joint venture between M/S Alvan Blanch Development Company and Colas Limited will manufacture, supply, install and commission multiple post-harvest processing systems. The memorandum of understanding (MoU) will also include delivery of related training and construction of associated infrastructure.

This will supplement other already initiated partnerships created by government to enable Uganda’s private sector to increase investment in processing and value addition. For example, in financial year (FY) 2019 to 2020, the ministry has through NAADS committed UGX 55 billion to set up grain, fruit and feeds processing plants in the districts of Yumbe, Kapeeka, Nwoya and Kayunga. This partnership also includes Uganda Prisons, Uganda Development Corporation and the Ministry of Trade, Industry and Cooperatives.

Partnership strategic objectives

The partnership aims to:

• improve the value of agricultural produce through the installation of value addition facilities; the ministry will establish collection centres for priority commodities by buying and installing 112 batch drying, cleaning and grading systems of grains, cereals such as maize, rice and pulses such as beans, soya beans across the country
• procure and install 12 fruit processing plants in identified locations
• increase storage facilities to accommodate increased processed output; MAAIF will build 19 bulk storage facilities (silos) with a capacity of 2,000 MT
• make more food to available to humans and feed for livestock, poultry and fisheries; the ministry will procure and install 10 milling plants and 9 feed processing plants in strategic locations after carrying out the necessary feasibility studies
• develop community based agro-processing capacity for self-employment and uplifting of local community through engaging farmer groups; private public partnership will be established with registered farmer groups and private farmers to run this infrastructure
• instil a culture of bulking for value addition and better marketing strategies to those selected farmer groups that will partner in this arrangement

Objective and scope of MOU

This MOU is a framework. It defines the agreed basis of cooperation between the government of Uganda and the joint venture upon which a project proposal in support of value addition and processing infrastructure will be developed in Uganda.

MAAIF has identified sites in the main maize producing districts which do not have silos/warehouses for storage.

The identified districts include:

• Central: Kayunga, kiboga, kyankwanzi, Kakumiro, Nakasongola, Kakumiro
• Busoga: Bugiri, Buyende, Iganga, Kaliro, Kamuli, Luuka, Mayuge, Namayingo, Namutumba, Bugweri
• Elgon: Bukwo, Bulambuli, Kween, Sironko
• Teso: Kaberamaido, serere
• Acholi: Amuru
• Bunyoro: Hoima and Kikuube
• Tooro: Kabarole and Kyegegwa

The joint venture will do:

• site surveys
• stakeholder consultations
• engineering designs
• environmental and social impact assessments and mitigation plans
• detailed project planning

This will ensure the project will be both commercially as well as environmentally and socially sustainable.

Financing

The joint ventures will seek 85% total financing of the project from the UK Export Finance (UKEF) via an export credit facility being offered by the UK government. 15% will be government of Uganda contribution.

Uganda’s Agriculture Sector Strategic Plan

The Ministry of Agriculture Animal Industry and Fisheries is implementing the Agriculture Sector Strategic Plan (ASSP 2015/16 to 2019/20). This is a 5 year strategy for the development of the agriculture sector, and is in line with the National Development Plan 2.

The ASSP provides the overall strategic and implementation framework for the agriculture sector priorities and is aimed at contributing towards the overall development goal of the country in regard to attaining middle income status by 2020.

One of the priorities under the ASSP is to improve access to agricultural markets and value addition for the 12 priority commodities (maize, beans, rice, tea, coffee, bananas, dairy, fish, livestock, meat, fish and vegetables) and 4 strategic commodities (oil palm, oil seeds, cocoa and cotton).

Under the grains value chains, the government acknowledges that there is need to increase grain processing capacity while improving post-harvest handling and management to match the crop production levels in the country. This will also increase farmers access to regional and international markets.
Distributed by APO Group on behalf of UK Department for International Trade.