Uganda Peoples Congress
Plot 8-10 Kampala Road, Uganda House,
P. O. Box 9206, Kampala
Wednesday, 28 September 2011
Uganda's sugar politics
Uganda Peoples Congress wishes to differ with president Museveni on his recent announcements and directives related to either increasing production or making the prices of sugar affordable to many.
Whereas we appreciate the concerns that the president seems to want addressed, we at the same time emphasize the fact that Mr. Museveni's recent policy shifts, as always, are not well calculated, not well thought out and will obviously back fire.
Recently the president stated that “NRM companies” will intervene and lower the sugar prices in the country by importing more sugar and selling it to people in this country at reduced prices. It was the first time the country heard about any NRM company after the eventual collapse of Danze enterprises over a decade ago. As expected the president's announcement rubbed his political merchants the right way. Indeed the minister of Justice and Constitutional affairs was reported in the news yesterday as being in the process of importing expired sugar from Kenya to sell to Ugandans. The people of Uganda may be facing a challenge with sugar prices but surely expired sugar, no matter how low it sells, cannot be the answer. We therefore implore the Uganda National Bureau of Standards to be on the look out to impound any sugar that does not meet the required consumption standards and help prosecute all those involved in this illicit trade.
There have also been reports that NRM offices in the countryside have turned into sugar stores and sugar rationing centers. Even if this sugar was to be distributed free of charge we are sure UPC members and members of other opposition political parties would never taste it. And besides NRM functionaries can sell at any price because they use government fuel to transport such sugar and they neither pay rent nor license.
We refuse to accept that the latest decree by the president on sugar is the answer either. In a free market economy no one can ever direct on who exactly a producer should sell to. Government of Uganda has no share in the sugar companies in the country. This leaves the president's directive redundant, archaic and illegal. The directive will surely be ignored and the sugar prices will continue to soar.
The president of Uganda is behaving like a child chasing evening insects. He goes out chasing a butterfly and soon realizes there is a grasshopper. Minutes into chasing this, he also recognizes there is a locust near him. He chases this too only to return home empty-handed, tired, frustrated and dirty.
Mr. Museveni has no firm and fine-tuned policy for his government to implement. He seems to be gambling not just on sugar alone but on all commodity prices and on energy, transport and agriculture. Those waiting for solutions from him may need to be very patient.
Government should subsidize industries that produce sugar and other essential commodities in Uganda; scrap Value Added Tax (VAT) on each of these commodities and cut taxes on fuel by 50%.
A clear and properly regulated public-private partnership should be put in place where for example government offers incentives like fertilizers and loans to sugarcane out-growers to ensure increase in sugar production.
Government should quickly re-prioritize its budget to give at least 10% to agriculture to ensure food security and boost the purchasing power of many Ugandans
A tax system and tariffs that are fair, transparent, understandable and affordable to the people of Uganda should be put in place.
Government should quickly pay off all debts owed to Eskom and Jacobsen thermal power generating companies to check load shedding and reduce the cost of doing business and the cost of production.
Government should re-establish a genuine cooperative movement in Uganda to enable sufficient production, easy transportation, timely processing and increased exports.
Deputy Spokesperson UPC