Cooperatives must return – experts

By Edwin Muhumuza

Economic experts have hailed the role of cooperatives in economic development arguing that they are still relevant following concerns of a struggling economy.They argue based on their potentialto increase vibrancy  in economic activity especially in the agriculture sector.

Economist, Dr.Fred Muhumuza says all strategies outlined in the budget 2017/18 will not push Uganda to middle income status unless small holder farmers are organized and empowered through cooperatives.

Development is anchored on institutions .People do not trust people but institutions. To re organize agriculture is going to involve revisiting our institutions and one among these is the cooperatives, trying to improve the quality of those small holder farmers.”

He disputes the narrative that small holder farmers are not commercial citing examples of matooke and milk producers in western Uganda who are commercial.

it is people who want to grab other peoples land who say people must leave the land so that we can commercialize, you can still commercialize under small holder farming models.’ says Muhumuza.

He further notes that under the current regime of governance,there is need to ensure that they are competitive through stringent regulation and accountability.

Senior Development Consultant,Denis Tukahikaho notes that without cooperation Uganda will not advance inspite of aspirations to reach middle income status by 2020 and 2040.He expressed concern on common sentiments that cooperatives were killed and buried by the regime with the aim of impoverishingUgandans so they can be easily ruled. Tukahikaho defers that Union leaders participated in looting of assets of cooperatives and willingly consented to lend assets to rebels.He notes that with liberation Uganda’s coffee was devalued on the market and farmers lost morale,faulting union leaders on excitement to abandon the movement to individual buyers.

‘In Uganda because of the  land tenure system we have no space for commercial farmers like in South Africa but only individual farmers who when brought together they make a pool for mass production.’ said Denis Tukahikaho.

Participants have called for change in perception regarding cooperatives  as not only agricultural based but diverse inform of health,finance,transport,IT among others during a workshop organized by the Uhuru Institute for Social Development in Kampala, on the role of  the cooperative movement and whether it is still relevant in Uganda.

Between 1960 and 1980, cooperatives were the engine for Uganda’s economic development, employing two halves the country’s civil service and handling over 70% of Uganda’s cash crops. In the early 1990’s the economy was liberalized and other private businesses entered the market and cooperatives died out but there is increasing demand for their restoration today.

Nakumatt closes amidst court battles with suppliers

The regional retailer Nakumatt closed three of its Uganda outlets last week but the remaining stores lack basic products, with many empty stalls and fridges, Uganda Radio Network has established.

The cash-strapped retailer closed stores at Acacia Mall in Kololo, Village Mall in Bugolobi and at Victoria Mall in Entebbe last week. In a statement, Knight Frank Uganda, the property manager of malls that housed the shut Nakumatt outlets said “the supermarket space at these malls will go under redevelopment.” In April, Nakumatt also closed its Katwe branch after it accumulated over 290 million shillings in rent arrears. It’s the same story in neighbouring Kenya where they have been closing underperforming outlets.

Nakumatt has five operational outlets in Uganda, four situated in Kampala and one in Mbarara town. Uganda Radio Network visited Nakumatt flagship store at Oasis Mall, along Yusuf Lule and Bukoto outlet which are half empty.

There are no beverages in the Oasis Mall outlet. For instance, buyers can’t get a 500-millilitre or 300-millilitre plastic bottle of soda in this outlet. There are less than 50 plastic sodas of two-litre volume remaining in this outlet.

When our reporter inquired why there are no beverages, an attendant said, “They have not been bringing them sodas and water for about two months.” Fridges and stalls in the beverages section are empty.

It’s the same story in the food section. Apart from bread, there are no food items in the supermarket. Stalls in the food section are empty. Our reporter was informed that the outlet’s butchery unit was closed months ago.

“Things are bad. We don’t know what will happen next,” an attendant lamented on Sunday at Nakumatt Oasis Mall. “We hear that there is no money and you can’t tell which shop will be closed next.”

On whether workers are paid, another attendant said, “Yes, they pay but things have changed. They don’t pay as they used to do two years ago.”

The only remaining items in Nakumatt Oasis Mall are mainly electronics, furniture and clothes. “They last brought stock here more than two months ago…I think, they bring in bread only and newspapers. That’s all,” an attendant explained.

The situation at Oasis Mall is similar to the one at Nakumatt Bukoto outlet. There are no beverages and food items in this store. Fridges and food stuff stalls are empty. An attendant told URN: “I hear they might close this store next.”

Court cases

Nakumatt has been sued by a number suppliers demanding payment. Last week, Britania Allied Industries Limited, a leading food and beverages manufacturer sued Nakumatt over unpaid debt amounting to 302 million shillings.

The regional retailer has also been sued by State Minister for Veteran Affairs, Bright Rwamirama and wife Florence Rwamirama, together with Mpororo Group demanding payment of over two billion Shillings in rent arrears. Nakumatt is operating its Mbarara branch at Multiplex Complex which is owned by Rwamirama. The four-storey building is situated on Plot 4, along Buremba Road in Mbarara town.

Nakumatt is a wholly Kenyan, privately held company, owned by the Atul Shah family. In a statement issued last week, Nakumatt boss Atul Shah apologised to the employees, creditors, suppliers and shoppers for the sorry state of affairs at the supermarket.

“We have learnt a painful, humbling lesson. We shall emerge stronger, firmly focused to place Nakumatt high on the continental and global retail map,” Atul said. “Allow me this opportunity to once again express my sincere apologies to all the stakeholders we have let down. I can’t say it enough, but I am sorry and sincerely committed to facilitating the turnaround of Nakumatt, whatever it takes,” he added.



Small businesses thrive around Namugongo as pilgrims continue to arrive

By Robert Segawa

Namugongo is now a sea of human activities as crowds of pilgrims in hundreds continue to flock the martyrs’ shrines a day before martyrs day celebration.

Motorists can no longer access the road to Namugongo because they have been banned in order to give way to the pilgrims.

A combined force of both military and police personnel including plain clothed officers has been deployed in and outside the shrine to provide maximum security.

Transport fares have been hiked since motorists used feeder roads to access Namugongo shrine. Transport from Kampala to Namugongo has been 2000 but taxis are now charging between  3500 to 4000 .

A number of traders have also  shifted their businesses to Namugongo bringing their services closer to the pilgrims.

Meanwhile, Father Jude Ssemambo the chairperson organizing committee for this year’s celebrations said all set for martyrs day tomorrow and asked believers to keep time adding that players of both shrines will begin at 9.30 am and expect to conclude players at 1pm.

New Vivo energy boss affirms steady fuel supply for Ugandans ahead of Kenya elections

By Patricia Osman

Gilbert Assi, the newly appointed Managing director Vivo Energy Uganda, assures Ugandans that plans are in place to stock enough fuel as Kenya elections close in.

Speaking at his unveiling in Kampala Mr. Assi says there is no cause for alarm adding that they are watching the events carefully and are aware of the threats that come with such an exercise.

His comment comes at a time when Parliament’s Natural Resources committee advises Government to stock enough quantities of fuel ahead of the August 2017 Election in Kenya.

The legislators are optimistic that refilling the reserves will secure supply of petroleum products in the event of any disruptions and eventualities.

Mr Assi who takes over from Hans Paulsen had been group head of distribution.

He promises to keep the company at the number one position by continuing to invest heavily in areas of fuel quality, road safety, Education and environment protection.

Mr. Paulsen has now been promoted to a new senior role in the Vivo Energy Group where he will be working across all countries in Africa where Vivo Energy operates on a new project to improve the company’s business among others tasks.

Legislators rule that arcade owners should be paid in Ugandan shillings

Ugandan tenants will no longer be mandated to pay rent in US Dollars following a new law passed by parliament.  The income tax amendment bill 2017 provides that all rental agreements must be executed in Ugandan currency.

The move comes in relief of tenants in many shopping malls who were forced by their landlords, to pay rent in US dollars despite earning in Uganda Shillings. This implied that their rent bills increased whenever there was appreciation of the Dollar.

Parliament unanimously resolved that all rental agreements must be executed in Ugandan Shillings in order to protect and eliminate exploitation of Ugandan traders whose profits are pegged on fluctuations on the money market.

Members argued that the new provision will boost the Uganda Shilling which is continuously depreciating against major foreign currencies and ease the cost of doing business in the country, especially since rental fees form a major challenge to business.

Finance Committee Chairman Henry Musasizi stated the move is good for the development of the economy.

Similarly Budadiri West MP Nathan Nandala Mafabi says Ugandan traders need to be protected.

The changes came as parliament amended the income tax act to provide for the exemption from payment of income tax for a number of companies and to empower the minister to issue estimates of rent for the purposes of assessing rental tax among others.



Traders protest against Chinese who are doing petty businesses

By Robert Segawa
Business has come to a standstill as Traders operating in arcades around  Nakasero market closed their shops expressing dissatisfaction over the Chinese traders who came as  investors but now doing petty  businesses which Ugandans can take care of.
The angry traders  operating on Seroma arcade, Nalule Arcade, MM arcade among others deal  mainly in hardware materials  and   accuse Chinese investors for engaging in retail businesses and selling at low cost hence pushing them out of business.
Ugandan traders closed their shops in a peaceful demonstration with placards asking Chinese investors to go back to their country.
Police from Central Police Station has been heavily deployed around the place to prevent violence and   the DPC CPS,  Joseph Bakaleke asked traders to be calm and warned them to desist from forcing those with open shops to close

Owino market leaders call on vendors to get back to work,DFCU not taking their land

By Zirimala Daudi
St Balikuddembe Market Leadership has called upon vendors who had left their stalls to return to owino market and start working after clearing allegations that the DFCU bank was selling the land on which the market sits after SSLOA defaulted on their loan.
Speaking to our reporter the chairperson of the market Joseph Lwanga assured vendors that the DFCU is auctioning land found in kisenyi which was bought to resettle vendors during the redevelopment of the market but not the land where the market sits.
He says that opportunists were using this chance to convince vendors leave the market with an intention of grabbing their stalls where they are operating from.

New Mobile company launches in Uganda

By Patricia Osman
Fero mobiles a new mobile phone brand has entered the Ugandan market launching 2 high technology phones the IRIS and Royale A1.
Vickam Giopla business head east Africa says the phones are designed specifically for the UAE market and Africa at large and are user friendly.
The most outstanding feature on the Fero Iris is unique security feature which allows the user to unlock their phone with their eyes.
It allows fast internet speeds with an 8MP camera at the back and 2MP at the front among others, it goes for 420,000 shillings.
The Royale A1 phone which goes for 370 thousand shilling on the local market has your voice as its command.
Users will be able to unlock their phones with their voice, It also comes with a 5000mAh battery a 5MP camera in front and 8MP back camera and the internal storage capacity of 8GB among other features.
Giopla says they already in business in Kenya,
Fero phones already has its footprint in Kenya, Tanzania, Rwanda, Senegal, Ivory Coast,Ghana,Togo,Nigeria and now in Uganda.

NSSF recovers 1.8Bn shillings through online whistle blowers page

By Wasswa Deo

The ongoing whistle-blower campaign by the National Social Security Fund (NSSF) has recovered over Shs1.8 billion .

Last month, the NSSF unveiled a new web-based whistle-blower platform for aggrieved employees to report employers who fail to remit their contributions to the Fund, as required by the law.

The Head Marketing and Communications, Barbra Teddy Arimi, says, up to 90% of the cases received were through the NSSF Whistle-blower platform, hence it is one of the Fund’s most effective tools to increase compliance levels and recover billions of employees’ contributions meant for their retirement.

According to her, more than 25,000 employers are meant to pay NSSF contributions. However, 12,000 of these are not complying and of the 13,000 who are complying, only 8,900 are consistently remitting NSSF contributions for their employees.

A total of 149 cases received over the last 4 months, January recorded the most cases at 55, followed by October (27).

She added that this is a continuous campaign, urging employees to continue being vigilant and speak out to ensure that their employers remit their savings to the Fund.

Tullow oil registers losses for three years in a row

Tullow Oil, the largest investor in Uganda’s Oil sector posted a post-tax loss of USD 597 million (2.2 trillion Shillings) last year, after writing off exploration costs and booking impairments.

This is the third consecutive year that the exploration company has reported a loss. According to its results for the year ended 31 December 2016, the company recorded a full-year operating loss of USD 755 million (2.7 trillion Shillings) for 2016.

This was down from a loss of USD 1.09 million (3.8 billion Shillings) posted in 2015.

The results indicate that the company had written off USD 723 million (2.5 trillion Shillings) of exploration expenses and ended the year with a net debt of USD 4.8 billion (16.9 trillion Shillings). The company’s revenue dropped by 21 percent in 2016 to USD 1.2 billion (4.3 trillion Shillings).

Aidan Heavey, the Group’s Chief Executive in a statement said the group has made excellent progress with its East African developments and are building a high quality exploration portfolio to grow the business.

He said the major highlight in 2016 was delivering Ghana’s second major oil and gas development, the TEN fields, on time and on budget.

Heavey who is soon handing over the position of Chief executive said production from TEN, alongside other West African oil production, has provided Tullow with free cash flow and enabled it  to begin the important process of deleveraging our balance sheet.

Early in January this year Tullow announced that it was to farm down part of its stake to Total at USD 900 million (3.3 trillion Shillings) and downgraded its production outlook for 2017.  Upon completion, the farm-down will leave Tullow with an 11.76 percent interest in the upstream and pipeline projects.

This is expected to reduce to a 10 percent interest in the upstream project when the Government of Uganda formally exercises its right to back-in.

Completion of the transaction is subject to certain conditions, including the approval of the Government of Uganda, after which Tullow will cease to be an operator in Uganda. The disposal is expected to complete in 2017.

There is speculation that Tullow may divest more of its projects in Kenya so as to cover about USD 5 billion (18 trillion Shillings) debt.

Tullow Oil announced a new oil discovery in Kenya, with the Erut-1 well in onshore Block 13T finding oil at the northern limit of the South Lockichar basin. It said there was good progress on a standalone development in Kenya with an export pipeline to Lamu.

It said life-of-field development costs (comprising operating expenditure, capital expenditure and potential pipeline tariffs) are expected to be in the region of USD 25 (89,000 Shillings) to USD 30 (106,000 Shillings) per barrel.

Preparations for the upstream development Front End Engineering Design (FEED) are under way, with FEED expected to commence in the second half of 2017.