KAMPALA: The Coffee Development Authority (UCDA) has signed a Memorandum of Cooperation with the Private Sector Foundation Uganda (PSFU), aimed at developing and promoting coffee production, marketing and consumption.
This is another idea that the UCDA hopes will increase not only production but also earnings through more local consumption and exports of value-added goods.
Under the MOU, UCDA will work with PSFU to establish mutual cooperation in the coffee sub-sector regarding production, productivity, marketing, policy environment, research, and coffee business in the private sector of Uganda.
It comes just as the debate ebbs over the controversial move by the government to facilitate foreign-owned Vinci Coffee Company Uganda to process and market Uganda’s coffee products.
The specific areas of cooperation will include the creation and exchange of information; cooperation on promoting coffee production, processing, domestic consumption and marketing in the private sector in Uganda and its membership.
Other areas include promotion and improvement in the marketing of coffee, including developing digital marketing platforms with the view of optimising efficiency and job creation among the youth; promoting domesticated consumption of coffee in the private sector; promotion of coffee tourism; and promotion of internationally accepted standards and quality of coffee to enhance its competitiveness.
Since UCDA announced the withdrawal of the country from participation in the International Coffee Organization early this year, it has intensified the search for solutions to expand the market and increase coffee earnings for the country.
“PSFU is currently engaged with 12 coffee companies through various interventions such as the Lead Firm Structure, where we have co-invested up to 10 billion shillings to unlock over 25,000 work opportunities for young people, of whom 70% are young women.
This is being done by working in partnership with the following lead firms: (i) NUCAFE, Touton Uganda Ltd, Kampala domestic Store; (ii) Inspire Africa Establishments, Kawacom (U) Ltd, Grain Pulse, among others, “noted Steven Asiimwe, the executive Director of the Private Sector Foundation (PSF).
The other intervention that the government has commenced on is the creation of a company that will be charged with buying, processing, and marketing Uganda’s coffee abroad.
UCDA, together with Uganda Development Corporation, the investment arm of the government, is going ahead with the establishment of a soluble coffee plant with the steering committee headed by the Permanent Secretary, Ramathan Ggoobi.
The Ministry of Finance, Planning and Economic Development has approved the concept.
“We want Ugandans to have shares in the plant and interest others abroad to invest with the government,” Dr. Emmanuel Iyamuremye said recently, urging Ugandans not to confuse this move with the Vinci Coffee venture.
“The company can help us in marketing Uganda coffee abroad because they know the external markets better than we do, but Ugandans will also invest in the plant so that we stop exporting green beans and invest in producing and exporting value-added coffee,” he said. Under the new memorandum, UCDA will also work within PSFU to influence and lobby areas of mutual interest and pursue legal, regulatory, and policy changes in the coffee value chain.
The two entities also agreed to raise private sector awareness about the value of coffee to the economy and household livelihoods. It is hoped that the agreement will in turn strengthen the co-operative movement.
“We observe that many cooperatives are not surviving beyond the founders. We intend to work with the Uganda Co-operative Alliance to see how to overcome this challenge, “said Iyamulemye, the UCDA Executive Director. The PSFU called for innovations that promote coffee and integrate it into other sectors as Uganda’s flagship product, like other countries do with where they are comparatively advantaged.
“Why can’t we have coffee tours like the South Africans have wine tours?” PSFU Chief Operating Officer, Grace Nshemeire Gwaku, stated. Apart from private sector companies, implementation of the Memorandum will also involve working with cooperatives.
Ivan Asiimwe, CEO of Uganda Cooperative Alliance, said this will also help strengthen cooperatives whose mortality rate is currently high, according to him.
To have a vibrant coffee sector, we need to strengthen cooperatives. “This agreement between PSFU and UCDA will help us overcome the challenges we face,” he said.
UCDA Board Chair, Dr. Charles Francis Mugoya, told the gathering that the Memorandum is timely, adding that a vibrant coffee sub sector with a strong public-private partnership will propel the industry to desirable heights.
Coffee exports totaled 6.26 million bags worth $862 million in fiscal year 2021/2022, up from 6.1 million bags worth $559 million in fiscal year 2020/2021. “We coffee farmers have been working separately with PSFU and separately with UCDA.” “The two institutions coming together will make us more competitive,” said Mugoya.