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Old January 6th, 2011, 06:47 PM   #521
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McLeod Russel Says Ugandan Tea Unit to Boost Profit as India Output Falls
By Pradipta Mukherjee - Jan 6, 2011 11:54 AM GMT

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McLeod Russel India Ltd., the world’s biggest tea grower, expects profit to climb 13 percent this year as higher prices and rising sales from its Ugandan estates make up for a decline in Indian production.

Group net income may increase to 2.6 billion rupees ($57.3 million) in the year to March 31 from 2.3 billion rupees a year earlier, Managing Director Aditya Khaitan said in an interview. Sales may climb 18 percent to 13 billion rupees, he said.

A pest attack on plantations in north India, which accounts for 70 percent of total output, have boosted tea prices, helping McLeod and rivals offset a drop in sales volume. McLeod fetched an average 150 rupees a kilograms at auctions in the year from April 1, about 10 percent more from a year ago, Khaitan said.

“We have been compensated with a better price,” he said. The company’s output may be lower by 3.5 million to 4 million kilograms, while the northern region will likely lose about 25 million kilograms of production, Khaitan said in Kolkata.

Mcleod’s shares advanced as much as 3 percent to 223.50 rupees in Mumbai, the most since Dec. 21, and settled at 218 rupees. The stock has risen 26 percent in each of the past five years, faster than the 18 percent annual jump in the BSE 200 Index, according to data on the Bloomberg.

Domestic prices may gain 5 percent to 10 percent next year as Indian production has declined below 980 kilograms for the first time in five years, Kamal Baheti, McLeod’s chief financial officer, said in an interview.

The company’s domestic production may decline to 74 million kilograms this year from 77.5 million last year, and output at James Finlay Uganda Ltd., which McLeod acquired last year, may be 17 million kilograms, Khaitan said. Total production may reach 96 million kilograms, he said.

Production in Uganda, Africa’s third-largest producer, may reach 55 million kilograms this year from a provisional estimate of 53 million kilograms for 2010, according to the country’s Tea Association. The country ships most of its tea through weekly auctions at the port city of Mombasa in neighboring Kenya.
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Old January 6th, 2011, 06:52 PM   #522
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India names new envoy to Uganda

2011-01-06 18:50:00
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New Delhi, Jan 6 (IANS) Amid burgeoning economic cooperation between India and Uganda, East Africa's growing economy, the Indian government has appointed S.N. Ray as New Delhi's envoy in Kampala.

Ray, who is presently joint secretary in the external affairs ministry, will succeed Niraj Srivastava as the the next High Commissioner of India to Uganda.

He is expected to take up his assignment shortly, the external affairs ministry said here Thursday.

Sibabrata Tripathi, presently High Commissioner of India to Kenya, has been concurrently accredited as the next ambassador of India to Somalia with residence in Nairobi, the ministry announced.

The economic ties between India and Uganda, home to a large Indian diaspora, are getting stronger. Last year, Uganda offered India huge tracts of farmland on lease in a bid to expand agricultural cooperation.

Uganda Business News: More Ugandans Open Up Investment Projects

Ultimate Media

The Uganda investment Authority says more Ugandans are increasingly opening up more investment projects than foreigners.

The Uganda investment Authority report 2010, indicates that out of the 323 projects registered last year, 143 belong to Ugandans.

The State minister in charge planning, Prof. Ephraim Kamuntu says the local investment projects brought in a total of 1.1 billion shillings.

He says the investment projects contributed 1.7 billion US dollars in the economy, as compared to the 1.6 billion US dollars in the year 2009.

The major sectors attracting investment include agriculture, manufacturing and finance.

Kamuntu attributes the growth in investment to macro-economic stability.

Uganda Approved $1.7 Billion of Investments in 2010

January 06, 2011, 6:35 AM EST

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By Fred Ojambo
(Updates with comment from minister in second and third paragraphs.)

Jan. 6 (Bloomberg) -- The Uganda Investment Authority approved investment projects worth $1.7 billion last year, up from $1.6 billion the year before, said Ephraim Kamuntu, minister of state for finance.

Local companies accounted for $1.1 billion of the projects, while the rest came from abroad, principally India, the U.K., Netherlands, China and Kenya, the minister told reporters today in the capital, Kampala.

“The positive trend is a sign that investors, both local and foreign, have confidence in the fact that the Ugandan economy is stable,” said Kamuntu. Investment may increase further in 2011 because of “rising demand for investment in petroleum, mining and agricultural industries.”

Uganda discovered commercially viable oil deposits in 2006 and will become Africa’s latest crude producer when Tullow Oil Plc begins production at the Kasamene field this year. The country has an estimated 2.5 billion barrels of oil, with 1 billion barrels already discovered, according to Tullow.

The country may license $3 billion worth of projects this year, $1 billion of them from abroad, Maggie Kigozi, the UIA executive director, told reporters at the press conference. That compares with the forecast for foreign investment of $1.2 billion she gave on Dec. 29.

A total of 323 projects, capable of generating 149,659 jobs, were licensed last year, Kamuntu said.
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Old January 6th, 2011, 07:08 PM   #523
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Uganda sees 2011 non-oil FDI rising nearly 80 pct
Thu Jan 6, 2011 4:04pm GMT Print | Single Page [-] Text [+]
KAMPALA (Reuters) - Uganda expects a near 80 percent jump this year in foreign direct investment excluding the oil sector, fuelled by global economic recovery and a peaceful election at home, government officials said on Thursday.

Investor interest in the east African economy has been lifted by the discovery of commercial hydrocarbon deposits in its west. The government says oil will potentially propel annual GDP growth rates to double digits once production starts.

The executive director of the state-run Uganda Investment Authority (UIA), Maggie Kigozi, told a news conference it expects to attract non-oil FDI worth about $3 billion this year, up from $1.67 billion in 2010.

"We think the economic conditions in our traditional sources of foreign investment, mainly Europe, will improve significantly which is underpinning our confidence," she said.

"Most remarkable, however, is that we have new sources of investment like India, China and the Middle East and these are replacing Europe. So even if Europe remains sick, it won't affect us much."

UIA said it licensed 63 investments in the last quarter of 2010 worth $646 million, which was a 7 percent increase from the same period a year ago.

A total of 149,000 jobs were created in 2010 from the 323 projects licensed, with agriculture accounting for the largest portion of the planned investments followed by manufacturing and financial services.

"The election activity that is going on has been peaceful so far and we are glad this is reassuring investors and we are certain it will be calm to the end and this will deepen their confidence in our economy," said Ephraim Kamuntu, junior finance minister.

The east African nation will hold presidential and parliamentary elections on February 18 and the incumbent, President Yoweri Museveni, is facing a stiff challenge from Kizza Besigye, the candidate of a four-party opposition coalition.

Some 53 percent of all planned projects licensed in 2010 are owned by Ugandans while India emerged as the leading source of foreign investment, bringing in $173 million, followed by the United Kingdom, Netherlands, China and Kenya.

Kigozi said foreign direct investment in the country's budding oil sector had been excluded from 2010's investment statistics because promoting the non-oil sector was crucial to the economy.
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Old January 6th, 2011, 11:16 PM   #524
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Government to brand cattle as north gets Shs123b
By Mercy Nalugo (email the author)
Posted Friday, January 7 2011 at 00:00
The government yesterday allotted Shs123 billion meant for the Peace, Recovery and Development Plan for Northern Uganda (PRDP).

Addressing journalists in Kampala yesterday, the Permanent Secretary in the Prime Minister’s Office, Mr Pius Bigirimaana, said Shs90 billion would be given to 40 districts in eastern and northern Uganda while Shs3.6b would benefit municipalities.

“Shs 6.2 billion will go to the Uganda Police Force, Shs1.3 bilion to the Uganda Prisons Services and Shs800m to the Amnesty Commission,” Mr Bigirimaana said.

He said Shs15 billion is meant for food production, ploughing, small dams’ construction and cattle branding while Shs2b is for the Karamoja development institutional support.

A total of Shs2.7 billion would be allocated to the northern Uganda monitoring and coordination programme while Shs1.6 billion will be used for purchasing ox-ploughs, oxen and heifers in the process of settling the people there.

The PRDP is funded by the donors and the government to help northern Uganda recover after two decades of war.

Karamoja gains
Mr Bigirimaana said the government would spend Shs2.6 billion on restocking Karamoja while 1.3 million cattle would be branded to guard against theft.

“Branding of the animals using bolus chips has commenced and so far over 4,000 cattle have been branded. Also 1,500 youth cadres have been recruited and trained to guard kraals, communities and urban centres.

“There is also increased police presence with 4,927 personnel and an additional 5,000 probation police constables and 500 cadets are currently undergoing training,” he said.

Investments to create 150,000 jobs
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By Barbara Among

A total of 149,659 jobs will be created from projects licenced by the Uganda Investment Authority last year.

A total of 323 projects were registered, with $1.7b injected. They are expected to create the huge number of jobs, according to the state minister for finance and planning, Ephraim Kamuntu.

Kamuntu was speaking at the launch of the Uganda investment report for 2010.

This implies that there was a 3% rise in planned investment and a 36% increment in planned jobs compared to 2009, where planned investment and employment were estimated at $1.6b and 70,289 respectively.

The minister attributed this to the efforts of the authority, which came into existence in 1991.

Manufacturing (119 projects) financial services (63 projects) and agriculture (50 project) took centre stage, accounting for 20%, 18% and 40% of the planned investments respectively.

For the fourth year running, Uganda tops the list of investors with 143 projects, with planned investments of $1.1b. This created 130,004 jobs.

Second to Uganda was India with 47 projects, worth $173m and China with 33 projects worth $65m.

The UK had 13 projects licenced last year worth $77m and created 970 jobs.

UIA executive director Maggie Kigozi said the authority awarded 650 companies concessions to explore in the different mining areas. Uganda has over 100 minerals, she said.
“Once these 650 companies are licensed and start operations, and given rising interest in the mining sector, the Government is projecting higher foreign direct investment in 2011,” said Kigozi.

Kigozi said planned investments for 2011 is $3b and foreign direct investments at $1b.

The authority hopes to meet the target by selling Uganda’s potential at several conferences.

Kigozi announced that Uganda would host the East African Petroleum Conference next month. This month, a delegation of authority officials is expected to travel to India for the Gujarat Summit to sell Uganda’s investment potentials.

In March, there will be a COMESA Investment Conference in Dubai and the authority is inviting the business community to participate.

Commenting on a recent a report by UNDP on productivity which portrayed Ugandans as less productive than Kenyans and Tanzanians, Kamuntu said that UIA, Bank of Uganda, and Uganda Bureau of Statistics revealed that 96.6% of the workers in 1,000 companies surveyed are Ugandans.

He said the survey found that although Uganda has the most educated people in the region, they lack the technical industrial experience.

Meanwhile, Kamuntu yesterday assured investors in the country that the February elections would not affect the economic and political stability in the country.

Karamoja cattle to be branded
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Cows drinking water from a newly-constructed trough in Nakapiripirit district
By Anne Mugisa

THE Government has started inserting electronic chips into Karamoja cattle to stem cattle rustling, the permanent secretary in the Prime Minister’s office, Pius Bigirimana, has said.

The cattle will be tracked down if they are stolen and anybody attempting to sell them will have to produce proof of ownership.

A total of 4,000 out of the estimated 1,200,000 head of cattle in Karamoja have been branded in the exercise that started recently, Bigirimana said.

He added that the programme, which was initially for 100 cattle, had expanded to 300 cattle being branded daily.

Bigirimana did not say how much the exercise would cost, but said it was funded by the Government.

“I cannot put a figure to it. It is an ongoing exercise. When we achieve our target, we will stop,” Bigirimana said.

He was addressing journalists at the Prime Minister’s office yesterday.

According to Bigirimana, the exercise is part of the Karamoja Livelihood Programme, which covers agricultural production, support for local governments and peace building in the region.

The programme covers the districts of Kaabong, Abim, Kotido, Moroto, Nakapiripirit, Amudat and Napak.

Bigirimana added that at least 1,500 youth had been trained to guard kraals, communities and urban centres.

He said 4,000 Police personnel had been deployed in the region and an additional 5,000 were being trained for deployment.

Bigirimana observed that agricultural production had increased. He said during the last financial year, through the tractor hire scheme, 2,312 acres of land were opened up to farming, while 6,000 acres had been tilled this year.

Bigirimana added that parish dams were being constructed in Moroto and Napak districts. The construction of low cost houses (modern manyatas) in Nakapiripirit and Napak had also begun.

Mining can end Karamoja woes
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By David Ssempijja

THE Government should improve the mining sector in Karamoja to accelerate the area’s development, civil society organisations have advised.

Isaac Kabongo, the executive director of the Ecological Christian Organisation, said the Karamoja region was endowed with high-value mineral deposits, but mining was done crudely, hence not benefitting the community economically.

“If we want to fast-track development in Karamoja, we need to support communities involved in artisanal and small-scale mining using crude and hazardous methods,” he said in an interview.

Kabongo said it was sad that Karamoja was among the most impoverished regions in Uganda, yet it has huge amounts of gold, gemstones, limestone and marble.

Foreign and local companies are prospecting for large mineral deposits throughout Karamoja.
Karamoja has a population of about 1.1 million people, with the majority of them involved in agro-pastoralism or purely pastoralism.

An estimated 40% of the Karimojong are engaged in rudimentary artisanal mining.

This calls for support to enanble them buy modern mining tools, protective gears as well as sensitising them about the best mining methods, which do not endager their lives.
Kabongo observed that the miners were susceptible to diseases because they mine with bare hands.

To maximise benefits from mining in the region, the Government should also facilitate investors to establish mineral processing plants to provide employment and market for the minerals.

However, as challenges continue to hit the Karamoja mining sector, the Karamoja Integrated Disarmament and Development Programme under the Prime Minister’s office, highlights mineral development among the key sectors of focus in the region’s five-year development plan effected last year.

Karamoja was not surveyed during the sh9.2b national airborne geophysical surveys done in 2008 by Fugro, a South African firm, with the firm citing insecurity.

The survey produced a mineral assessment map of the country, showing which areas were rich with what minerals and and their quantities.

The results are used by the Government to plan for the sector. However, the surveys covered 80% of the country, with the remaining 20% representing Karamoja.

Information on mineral in Karamoja is of the 1960s. It is only private firms that have bits of new data on mineral developments in the region, whose accuracy is doubtable.

cannot be ascertained,” according to the country advisor of the Green Support Fund, Charles Kabiswa.
In such a situation, there is a likelihood that private firms manipulate such data to their advantage.

cannot be ruled out, neither are local land holding communities or individuals immune from such manipulations to their disadvantage.

The non-state stakeholders in development therefore, envisage a strong need to address these inequalities in the current legal framework, making them more supportive, easier to access and beneficial for artisanal and small scale miners.

Sugar output up by 7,800 tonnes
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By Samuel Balagadde

SUGAR production by the three major firms has go up, according to the Uganda Sugarcane Technology Association.

Wilberforce Mubiru, a manager at the association, said 263,190 tonnes were recorded by November last year, up from 255,327 produced in the same period in 2009.
This was a 7,863 tonne rise in output.

For the first time in three years, the factory price of sugar remained at sh2,066 a kilo during the festive season.

Mubiru said sugar production meets the local demand, adding that the increment in retail prices was speculative as dealers always anticipate low output during festive periods.

“There was no reduction in sugar manufacturing because we wanted to satisfy our 98% market share,” he explained.

New technology to harvest Mukene unveiled
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Uganda gets very little mukene because of using poor tecnology
By John Kasozi

UGANDA fishermen will soon start harvesting offshore silverfish, commonly known as mukene, using a new technology (catamaran) to increase their catch.

Dr. John Balirwa, the director of the National Fisheries Resources Research Institute (NaFIRRI), said the fisheries department would introduce and train fishermen on how to use the technology to harvest offshore silverfish as part of the sector development.

“The trials of the technology are being conducted at Gerenge landing site near Entebbe. The success of these trials might transform silverfish harvesting,” he said.

The technology uses a lift net spread over a wide area, which is pulled by paired-boats (catamaran).

The project is funded by Food and Agriculture Organisation (FAO).

“Fishermen are using large out-board engines boats to go off-shore to catch mukene. Catamarans are recommended because they are more stable and have relatively higher catches than the other type of boats,” Balirwa added.

He added that Uganadan fishermen fish along Lake Victoria shores unline their Tanzanian counterparts, who fish offshore.

They need to adopt the technology,” he observed, adding that this threatens the sustainability of the industry.

Balirwa noted that the Uganda poultry industry was growing faster, leading to an increase in demand for mukene.

“Out of 100kg of poultry feeds, dry mukene constitutes 20kg, which is about 45kg when it is wet. For the poultry starter feeds, it is about 40kg of dry mukene.

He said the consumption of mukene was increasing because people have understood its nutritional value. Fish provides 50% of protein diet for the Ugandan population. Fish contains anti-cholesterol known to reduce heart diseases.

In St. Balikuddembe (Owino) Market one kilogramme of human and poultry mukene is at sh4,000 and sh2,400 respectively.

“Mukene is now exported to Malawi, Zambia and Zimbabwe.

“But the demand for it doesn’t correlate with the fishing techniques. So there is need to embrace the catamaran technology,” Balirwa advised.

However, an increase in fishing pressure, targeting mukene due to decline of Nile perch could have adverse effects on the stocks if not controlled.

There was a three-fold increase of silver fish bio-mass in Lake Victoria from 0.49 to 1.48 million metric tonnes bewteen August 2005 to February 2008, according to hydro-acoustic surveys.

The annual catch assessment survey estimates for mukene for 2008 indicate that Uganda caught 85,824 tonnes, Kenya 75,046 and Tanzania 252,483. Based on two surveys for February and December 2008, the total catch was 413, 353 tonnes. There was no catch assessment survey in 2009.

The annual estimates of 2010 mukene catch were; Kenya 51,000 tonnes, Tanzania 295,428 and Uganda 69, 756, totalling 416,172 tonnes. The hydro acoustic surveys were conducted in February-March and also in August-September for 2008, 2009 and in March for 2010.

The estimated mean bio-mass of mukene in Uganda waters in Lake Victoria in February 2008 was about 712,707 tonnes, but reduced to 313,677 in August.

February 2009 it was 456, 122 and August 506, 365 and March 2010 it was 411, 848 MT.

“The recommended harvesting time for silver fish is six to eight months, while tilapia is from 18 months to three years. For the Nile perch is five years. The Nile perch and Tilapia cannot live more than 12 and four years respectively,” said Balirwa.

Mukene stock although very productive and currently contributing over 60% of fish biomass in Lake Victoria, its fishery is very much affected by environmental conditions in the lake.

Increase in high algae productivity due to increase in nutrient loading have an advantage to Mukene as they are pelagic and feed lower in the food chain and thus not affected by low oxygen levels in the water and has a lot of food, the microscopic animals (zooplanktons) which feed direct on the algae (microscopic plants).

The other advantage which moderates the stock sizes from serious decline is the fishing method which cannot be operated during full moon and thus control the fishing days per month and limit the overall effort in a year.

Dr. Justus. Rutaisire, the head of aquaculture research at NaFIRRI noted that Uganda has not reached the level of farming Mukene. “There is a lot of it in the lake.”

According to Oliva Mkumbo NaFIRRI research scientist, Mukene are short lived fish, grow very fast but are also very delicate to handle. “Being pelagic and have schooling behavior, you require a large volume of water to be able to keep, breed and grow such fish.”

Its size and amount required to make a kilogramme, may not be that cost effective in fish farming in relation to your inputs and the cost of that fish per kg. Fish farming considers the robustness of a fish species, and its value in the market in relation to the cost of production.

The sustainability of any fishery calls for proper management of the resources. At present, the Mukene stocks seem to be healthy and the fishery capable of expansion into open waters but this should be monitored carefully because there are some areas of concern.

Mukene contributes almost 70% of the fish landed from Lake Victoria, but in terms of its value, it is less than 30% of the earnings from fishery. There is need to ensure proper handling, processing of the catch, packaging and value addition to make better use of that resource for poverty alleviation amongst fishing communities and increase the socio-economic benefits to the Lake Basin region.
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Old January 6th, 2011, 11:27 PM   #525
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Govt raises subsidies to power companies
Written by Simon Musasizi
Wednesday, 05 January 2011 18:45
Government will, this year, almost double the amount of subsidies to the private power companies to deal with the growing demand for electricity.

Umeme Ltd, Uganda Electricity Transmission Company Ltd (UETCL) and Eskom (U) Ltd will receive Shs 488bn from government to maintain the current electricity tariffs. This is far above the Shs 280bn they received last year, the highest amount of subsidy to a single sector on record.

The increment follows an application from the companies to have their tariffs for 2011 reviewed citing high operation costs resulting from the depreciation of the shilling against the dollar amidst the increasing costs of diesel at the international market; it is projected to stay above $85 per barrel this year. Umeme recently failed to convince a public gathering to allow it hike its tariffs.

“Government has continued to inject a significant amount of subsidies in the electricity sector in order to keep the tariffs where they are now, a situation that is unsustainable for a much longer period,” Simon D’Ujanga, the state minister for Energy said.

“It is desirable that the sector becomes self financing with limited reliance on the national treasury.”
However, this cannot be achieved when the power companies still operate inefficiently with the cost of generation still high. Uganda has one of the most expensive fees on electricity in East Africa, a factor that makes it difficult to attract investors.

Domestic consumers pay Shs 385.60 per kilowatt per hour of electricity, while commercial consumers pay Shs 292.60 per unit and medium industrial consumers Shs 333.20 per unit. Large industrial consumers pay Shs 184.80 per unit.

Eskom (U) Ltd hopes to generate power at Shs 36,744 per megawatt per hour –with bulk supply tariff of Shs 330.61 per kilowatt hour, Shs 292.57 per kilowatt hour, and Shs 244.23 per kilowatt hour at peak, shoulder, and off-peak respectively.

“We appeal to all utilities to embark on measures that can improve their operating efficiency in order to achieve a financially sustainable sector in the long run,” D’Ujanga says.

Over the years, Uganda has suffered from power shortages exacerbated in recent times by significant reductions of water levels on Lake Victoria. The water release for 2011 is projected to remain at 800 cumecs, translating into average generation of 138.6MW from Owen Falls Dam.

The introduction of thermal plants eased the load shedding schedule, although prices remained high. The thermal plants include a 50MW project at Lugogo licensed in 2005, another 50MW at Mutundwe, and 50MW at Namanve and 18MW in Tororo.

Yet the demand for electricity continues to grow. According to Benon Mutambi, the acting CEO at the Electricity Regulatory Authority (ERA), demand growth for 2011 is projected at 2.5 percent quarter on quarter.

However, government is confident that with the completion of Bujagali power dam, the power demand will be addressed and the costs of subsidizing the sector will start going down.

According to D’Ujanga, the first 50MW of Bujagali hydropower dam is set to be opened late this year reducing current costs by almost one third.

At the same time, a number of independent power producers licensed by ERA are about to be commissioned. The 18MW Mpanga plant and the 6.5MW Ishasha plant are scheduled for commissioning early this year while the 9MW Buseruka plant will be commissioned mid this year.

Government has also widened its options beyond hydropower. With the Renewable Energy Policy formulated in 2007, D’Ujanga says, government has revised the feed-in tariffs to attract more renewable energy, especially from sugar companies.

“Learning from our experience of 2005, we no longer want to rely on only hydro generation. We are trying to put in place measures that will facilitate diversification of energy resources,” he notes.

D’Ujanga further reveals that government has also realised that the private sector cannot provide all the electricity needs for the country on its own. In this regard, government has reconsidered to partner with the private sector to develop some of the generation facilities that are purely public projects.

“We have now strengthened the Uganda Electricity Generation Company Ltd to assist government achieve this objective,” he says.

UEGCL is developing generation facilities such as Muzizi. Umeme has also increased its investment in the sector –with its capital investments expected to amount to $84,555 million in 2011 compared to $65,383 million in 2010.

This has seen its collection rates improve greatly to more than 96 percent –with a notable improvement in the distribution losses in 2010 reducing from an average of 35 percent in 2009 to an average of 30 percent in 2010.

With that, government has set the effective distribution loss factor target for Umeme at 27.2 percent while effective collection efficiency factor has been set at 95.6 percent for 2011.

The reconnection fee for domestic consumers has been raised from Shs 3,600 to Shs 11,800 while that of three-phase consumers has been raised from Shs 11,800 to Shs 25,200.
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Old January 7th, 2011, 10:17 AM   #526
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150,000 jobs created in 2010 - investment body

Prof Kamuntu and Dr Kigozi, while releasing the 2010 report in Kampala yesterday. PHOTO BY YUSUF MUZIRANSA.

By Faridah Kulabako (email the author)
Posted Friday, January 7 2011 at 00:00
A few more Ugandans are expected to find jobs following a 36 per cent increase in projects licensed by the Uganda Investment Authority last year.

According to the annual investment report released yesterday, UIA licensed 323 projects between January and December, with a total planned investment of about $1.7 billion and 149,659 planned jobs.

In 2009, UIA licensed projects with planned investments estimated at $1.6 billion while employment was estimated at 70,289.

UIA also registered a 3 per cent increment in investments during the period. With over 400,000 graduates joining the labour market each year, only about 80,000 are absorbed in both government and the private sector.

Speaking at the release of the report, the minister in Charge of Planning Prof Ephraim Kamuntu attributed the growth in investments to the country’s good investment climate resulting from macro economic stability, economic growth and political stability.

He said investors should not worry about the election period as business will continue as usual even after the elections expected to be held on February 18.

Elections and investment
Investors usually hold back investments whenever there are presidential elections for fear of business disruptions especially in Africa where presidential elections have often turned out to be violent like the 2007 post election violence in Kenya, Zimbabwe and currently in Ivory Coast.

For the sixth time, Ugandans were the largest investors in 2010 with 143 projects estimated at $1.1 billion of planned investments.

India with 47 projects worth $173 million and China with 33 projects estimated at $65 million came second and third respectively in terms of projects licensed for new investment.

The United Kingdom investments were worth $76 million. The Netherlands, China and Kenya registered significant investments in the manufacturing, construction, transport and communications sectors.

Greater 2011 growth
Dr Maggie Kigozi, the UIA executive director; projects greater foreign investments of about $1 billion in Foreign Direct Investments and $3 billion in planned investments in 2011 given the trend the country is experiencing with the rising demand for investment in petroleum, mining and agricultural industries.

Western Uganda tourism boosted by Shs1b resort
By Walter Wafula (email the author)
Posted Thursday, December 23 2010 at 00:00
Tourism in western Uganda is expected to receive a boost from the development of a new Island resort on Lake Bunyonyi in Kabale district.

Mr Jim Bitwire, a director of Bunyonyi Wildlife Island said up to Shs1 billion will be invested in Kyahugye Island Resort to further tourism activities in the region.

“We are looking at Lake Bunyonyi as the hub of tourism in this country. So, we are trying to create something unique for the region,” Mr Bitwire said in an interview with Daily Monitor.

Lake Bunyonyi, the second deepest lake in the world lies on a strategic location of the tourist circuit encompassing the mountain gorilla region of Uganda, and Rwanda.

The Lake is also famous for bird watching. So far, Shs600 million has been invested in the Island resort that is expected to generate hundreds of jobs and incomes for the local people and businesses in the western region.

The first phase of the project with up to 49 rooms, and cottages will be launched on December 26 while completion of the project is planned for mid next year.

To make the Island appealing to tourists, the company plans to translocate a number of animals from Lake Mburo National Park, Queen Elizabeth and Bwindi Impenetrable National Park.

The translocation of animals and birds from other national parks is also expected to help schools in Kabale cut back their tourism budgets to other areas as the resort positions its self as a wildlife research and education centre.

“The Island will provide a place where students and people can carry out research with ease,” Mr Bitwire said.

The investment comes at a time when Uganda’s tourism industry is registering improved growth in the range of 6-8 per cent per annum.

Tourists number increased by four times in the last ten years, from less than 200,000 in 1998 to 843,864 in 2008.

The numbers, however retreated to 817,000 last year due to the global recession that hit the airline and tourism industries. However, foreign exchange from tourism rose to $600, according to statistics compiled by the Uganda Tourism Board (UTB).
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Old January 7th, 2011, 11:16 PM   #527
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Work starts on 10,000km of roads
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Tarmarcking of some roads is already in progress
By Conan Businge and Abou Kisige

Mbarara-Kikagati (75km)
Nyakahita-Fortportal (208km)
Gulu-Nimule (104km)
Mpigi-Sembabule (135km)
Vurra-Oraba (92km)
Malaba-Bugiri (82km)
Mbarara-Katuna (154km)
Mukono-Kayunga (94km)
Jinja-Kamuli (69km)
Moroto-Nakapiripirit (90km)
Ishaka-Kagamba (72km)
Kapchorwa-Suam (77km)
Rukungiri-Ishasha (104 km)
Kaiso-Tonya-Hoima (85km)
Soroti-Mbale-Tororo (140km)

WAILS pierce a banana plantation as three coffins, two for adults and one for a child lie on mats, surrounded by hundreds of mourners. Minutes later, they are lowered into graves in Bungo village, Mpigi.

The three died in an accident alongside four other people, when their vehicle rammed into a train at a railway crossing on Tirinyi Road, between Iganga and Mbale.

The deceased are victims of a growing tragedy. According to Police records, 40,556 people have died in motor accidents from 2000 to 2009.

However, the deaths arising from accidents are expected to go down when the country’s road sector is revamped.

According to the Uganda National Roads Authority (UNRA), 10,000km of roads are to be constructed this year at a cost of sh800b.

The road construction project follows the Government’s take over of district roads in 2009. The roads were handed over to UNRA as part of the road sector reform.

The construction, scheduled to take three years, will have 60 roads rehabilitated and upgraded, according to UNRA’s publicist, Dan Alinange.

Construction has already started on some roads like Kampala-Masaka, Kawempe-Kafu-Soroti-Lira, Kabale-Kisoro, Kampala-Gayaza-Ziroobwe, Matugga-Semuto-Kapeeka, Masaka-Mbarara, Kampala-Mityana, Fort Portal-Bundibugyo and Kampala-Jinja.

The European Union ambassador, Vincent De Visscher, says when more roads are constructed, road carnage will reduce. The EU is financing close to half of the road construction costs.

But Alinange added: “Some of the roads will be widened which will result in the displacement of people and property.” He said UNRA would compensate the owners.

However, during a recent road tour, residents told Saturday Vision that although work on some roads was about to start, they had not yet been compensated. Residents in Mityana district, where UNRA has started working on the Kampala-Mityana (57km) road, had mixed reactions.

“We want the road, but we do not know how our property will be valued and how much we shall be paid,” Robert Mubiru.

Mohamed Kateregga of Bbosa village in Mpigi said all his land would be taken up by Mpigi-Sembabule road (135km). “I have lived here for more than 20 years. Much as we are going to be paid, I find it hard to believe that I will be kicked off my land. It means a fresh start at 55 years.”

Another resident, Charles Lwanga, in Nabwewenga village, on the Kampala-Mbarara highway, says much as the construction of 124km road initially affected their businesses, the new road has advantages. “As the road was being worked on, traders lost money because residents refused to buy dust-coated goods. But now, we can easily transport our merchandise.”

“This is a golden opportunity for us to have our road worked on. It used to be terrible, but it has greatly improved much as construction is still on going,” says Moses Mulindwa, a resident of Buloba on the Mityana-Mubende road.

Companies that have won the tenders to work on the roads include Emtee constructors, BMK (U) Ltd, Prime contractors and Multiplex.

Meanwhile, 35 new bridges will also be constructed, while 30 others will be rehabilitated. Detailed designs for the bridges were completed in November 2009 and civil works contracts were awarded in August 2010.

UNRA also says a new bridge will be built to replace the Nalubaale Bridge in Jinja. Another bridge will be constructed at Awoja and on other rivers in northern and north western Uganda.

Construction of the new bridge in Jinja is expected to commence in August at a cost of $100m (about sh200b), and will last four years. UNRA has secured all the land required to accommodate the bridge and feeder roads.

Meanwhile, a new bridge is already being constructed over River Aswa on the Gulu-Kitgum highway to replace the old one. Works on the bridge started last year in May and are expected to end by June this year.

Uganda has a total of 21,000km of national roads, 22,500km of district roads, 4,800km of urban roads and 35,000km of community access roads..
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Transport minister calls for long-term railway master plan
8th January 2011

Minister for Transport Omary Nundu
Minister for Transport Omary Nundu has directed railway experts in his ministry to collaborate with other institutions to prepare a Tanzania Railway Master Plan, insisting that its preparation must envisage long-term plans.
The directive was given by the minister when touring Morogoro region recently where he inspected the central railway line and observed the construction of river banks from Kilosa station in Morogoro to Gulwe station in Mpwapwa District, Dodoma Region.
The minister also visited a railway workshop in Morogoro and talked to railway staff here.
Nundu said a feasibility study for the Dar es Salaam-Isaka railway to Rwanda and Burundi has been completed.
“And because the preparation for the construction of the railway is going on the ministry will carry out a feasibility study to improve Isaka-Mwanza and Tabora-Kigoma railway and their branches,” said Nundu.
He said the study will consider all railway branches on the Tabora-Mpanda and Manyoni-Singida stretches because they are the most important in serving the people in the areas.
“This is an order and this must be done as soon as possible in the 2011/2012 financial year,” said Nundu.
He called on the experts to work collaboratively with other institutions to carry out a feasibility study for a railway project that starts from Tanga port at Mwambani to–Arusha-Musoma-Kampala up to South Sudan.
“It is important as we are now finalizing the construction of Mwambani port in Tanga,” he said.
On Mkondoa river floods which destroyed the central railway line stretch from Kilosa to Mpwapwa in December 2009, the minister said his ministry will work with other stakeholders to improve the railway infrastructure.
“We have observed the problem. We shall involve other stakeholders to rebuild eight dams around Mkondoa River in order to control the water current and later on we shall use the water for our national economic growth in areas of agriculture, livestock keeping and fishing,” said Nundu.
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Old January 8th, 2011, 03:22 PM   #529
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East Africa poised to tap a reborn south Sudan
January 7 2011

NAIROBI/KAMPALA, (Reuters) – East African nations could reap trade and investment opportunities worth billions of dollars to help develop south Sudan if it splits from the north, but they will have to compete with bigger rivals like China to do so.

Southerners are expected to vote overwhelmingly in favour of separation in a referendum next week, a vote that follows decades of civil war with the north and, the south says, economic and political marginalisation.

While companies in neighbouring Kenya and Uganda, from taxi firms to Kenya’s largest lender by assets, Kenya Commercial Bank (KCB), are already tapping the boundless opportunities in Juba, the south’s capital, others are primed to join in.

“We have an advantage but that does not mean we cannot be outcompeted,” said James Shikwati, executive director of the Inter Region Economic Network think-tank.

“Powers such as China, Japan, India are also ready. Whatever we manufacture, they can land here at almost zero cost.”

Kenya’s exports to south Sudan almost doubled between 2005 and 2009, rising to 12.8 billion shillings ($157.7 million) from 6.8 billion after south Sudan rebels signed a peace agreement with Khartoum’s administration that paved the way for Sunday’s vote.

South Sudan is neighbouring Uganda’s main export market, importing goods worth $184.6 million from east Africa’s second largest economy in 2009, according to the Uganda Exports Promotions Board.

“For the last couple of years south Sudan has been the largest driving force for our manufacturing sector because its demand for our products has been remarkable,” said Maggie Kigozi, executive director of the Uganda Investment Authority.

Uganda is establishing a 3.0 billion shillings ($1.29 million) industrial park in Gulu for manufacturers targetting the south Sudan market, she said. Once a marginalised town at the heart of northern Uganda’s own civil war, Gulu has boomed as a trading post linking Kampala and Juba.

Toyota Uganda plans an engineering and repair workshop in Gulu to tap the neighbouring market, where Toyota’s 4×4 Landcruiser rules the dirt tracks.

The risk for East African nations is what happens if the vote ignites a new conflict that might draw in regional economies, in which case neighbours could expect a sharp downturn in demand for their products as well as a torrent of refugees.

A return to war might cost neighbouring countries 34 percent of their total annual GDP over a 10-year period and set back Kenya and Ethiopia $1 billion annually, according to a report by Frontier Economics.

“If the referendum is conducted well and Khartoum receives the outcome peacefully and south Sudan is born as a new state, we’re almost certain our annual exports to this new country will double, our trade with south Sudan will grow tremendously,” said Florence Katta, head of the Uganda Exports Promotion Board.

“If the vote favours secession and Khartoum starts a war, our exports will plummet.”

Kenya’s KCB has plans to double its branches in South Sudan to 30 by 2015 and stands to lose its investment if war erupts.

“It’s virgin territory … It has got the potential to be the biggest economy in the region in the next 10-20 years,” KCB chief Martin Oduor-Otieno said in a Reuters interview.

“Everybody is holding their breath. The last thing anyone wants is another Somalia flaring in the region. If that happens it will be extremely difficult to stabilise the south,” said James Shikwati. “It’s about regional security and stability.”


Kenya is positioned to pitch itself as a logistics hub and transport conduit for an independent but landlocked south Sudan.

The region is rich in oil, the main bone of contention over the demarcation of borders, which it pipes north to Port Sudan.

Analysts believe the new state would seek to export its oil to the Indian Ocean coast via a yet-to-be-built corridor through Kenya to sidestep Khartoum.
Hungry for the south’s resources, countries such as China and Japan will happily finance such an alternative exit route, analysts say.

Kenya is seeking investors to fund its $22 billion share of a planned corridor connecting Ethiopia and Sudan to the Kenyan coast with railways, roads, telecommunications cables and a 1,400 km pipeline.

Toyota Tsusho, the investment wing of the carmaker, is one of the companies interested in the $1.5 billion pipeline, according to an International Crisis Group (ICG) report.


There is some resentment towards Kenyan and Ugandan business players investing in south Sudan, however, with some southerners perceiving them as hawkish and exploitative. They say neighbouring countries benefitted from the aid funding that flowed through their economies when they sheltered refugees, and should leave the country to its owners.
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Old January 9th, 2011, 12:01 AM   #530
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2010 was the year of Internet revolution
By Mustafa Ziraba (email the author)
Posted Sunday, January 9 2011 at 00:00
There was a time where you had to pay through the nose for Internet. First you paid UTL for the landline usage, then paid the Internet Service Provider (ISP) for the service. In 2010, Orange Uganda and MTN launched their 3G networks that made Internet blazing fast, a milestone many current users of Internet in this country might not appreciate. But for those folks who had double bills to UTL and the ISP, this whole Internet “revolution” is a godsend.

More and more people are using the Internet, from business to media downloads and social outlets such as Facebook and Twitter. Parallel to this Internet usage in Uganda is the sudden availability of USB Internet dongles. A dongle lets you take the Internet with you wherever you go. Simply plug it in any modern computer and you’re free to surf.

A dongle allows you to surf the net no matter where you are, as long as you’re within reach of a mobile signal, you’ll be able to get online. And Internet prices are getting cheaper all the time. You can now get online with a dongle for as little as Shs25,000 a month for 500MB of data. Unless you are a download buff or very media-centric, 500MB is quite sufficient.

However, you should make sure to check the coverage of your chosen Internet provider before signing up as dongle coverage can be patchy in some rural areas. This check is very important with providers such as Broadband who use a different technology, but with the telecoms, it is as relevant as you getting your mobile phone signal in the area of concern.

The rise of Internet usage in Uganda could virtually and wholly be attributed to the arrival of the Seacom cable. It started operations in July 2009, but the fruits were born in 2010; well, to the common man like you and I.

Previously, we were all relying entirely on expensive and slower satellite connections, which is why the speed jump is so significant. From a personal experience, it took me two to three hours to download my first MP3 song of about 2MB. This was in the mid 90s, where you had to pay for every minute you were connected, but now I could to the same in mere seconds and pay less than Shs50.

With use of their marketing machinery, Orange and MTN have managed to get Internet into the hands of people who didn’t even know they needed it. Nowadays, if you’re not on Facebook, you’re presumed dead by your peers, at least among teens and “tweens”. Many modern phones, which without an Internet connection are half the time irrelevant, are now very useful as you can easily connect to the Internet with them, read emails, do Facebook and Twitter updates, chat etc. The Seacom cable did reduce Internet costs up to 80 per cent.

It may take a while for the benefits to reach fellow comrades, particularly those who live in remote rural areas, but 2010 simply marked the beginning.
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Old January 9th, 2011, 11:07 PM   #531
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EU envoy hails govt on peace in northern Uganda
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By Francis Emorut

THE outgoing European Union (EU) Ambassador, Vincent De Visscher, has commended the Government for restoring peace to northern Uganda.

“We thank the Government for ensuring the return of peace in northern Uganda. Over 1,200 formerly displaced persons have returned home. We are happy about that achievement,” Visscher told guests, who included heads of diplomatic missions in Uganda.

He was speaking at his farewell party at Kampala Serena Hotel on Thursday.

For 20 years, the people in northern Uganda faced instability caused by the Lord’s Resistance Army rebels. Over 2,000 people were killed and 2,000 displaced.

De Visscher, who is also the head of the European Union delegation, hailed the Government for taking a leading role in regional integration.

The ambassador, who has been in the country for four years, has retired from diplomatic service.

The state minister for works, John Byabagambi, who represented the foreign affairs minister, Sam Kutesa, thanked the EU for supporting the Government in the road construction and water sectors.

He also commended De Visscher for risking his life to visit Karamoja during the disarmament exercise.

Byabagambi assured diplomats that the Government was committed to ensuring free and fair elections.

Presidential and parliamentary elections will be held on February 18. Eight candidates are contesting for the top job in the country.

We have come a long way
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Hilton Hotel still under construction in Nakasero. Such developments have been common in the last 10 years
By Paul Busharizi

THEY say we tend to overestimate what we can achieve in a year and underestimate what we can achieve in 10 years.We are into the new decade and a cursory glance to where we were 10 years ago makes for interesting reading.

In the last 10 years, the size of the economy has doubled.

According to official statistics, the size of the economy, as measured by the gross domestic product (GDP), rose to sh20.6 trillion in 2009/10 from sh10.5 trillion in 2000/01.

The naysayers will have their doubts about these figures and in a way, their scepticism will be warranted because the same figures show that our individual share of this economy only grew by less than 50% during the same period.

This variance can be accounted for by the fact that over the last 10 years, our population has grown. Assuming a 3.1% annual growth over the year, Uganda’s population would be up more than a third today from a decade ago.

But also during the period, the structure of the economy continued to change. The agricultural sector share of the economy plummeted to less than 15% compared to just over 40% in 1999/2000. The share of services and industry grew to fill the hole.

This should come as no surprise as our agricultural sector continues to remain largely subsistent, and even where there are attempts at commercialisation, very little value is added beyond the basic post harvest processing.

Given the economic history of the world, it is a natural progression for economies to shift away from agriculture to industry, and eventually to services. A transformation of the economy is under way.

For instance, there were 30 million farmers in the US after the Second World War, a figure that has fallen to under a million currently as people have concentrated in the urban areas, where they are more productive. Agriculture has become more large-scale and mechanised.

The worry in our situation is that the bulk of our people live in the rural areas, and as the statistics suggest, are not benefiting as much from the economic growth gains of the last 10 years.

It is no surprise that services have risen to pole position in our economy. There has been an explosion of services in the telecommunication and financial industries.

Over the last decade, we have seen teledensity – the number of people with access to telephone services as percentage of the population – jumping to 30% , up from under 10% at the beginning of the decade.

The importance of communication can not be underestimated in driving economic growth.

Businessmen have now cut out the cost of unnecessary trips, and have been able to respond quicker to market demands. With the introduction of money transfer services, they have also cut down the cost and risk of transferring money.

The increase in bank branches to 381 currently, from 167 in 2001 is the most manifest sign of the increase in financial services over the last 10 years. But the real telling statistic is the increase in deposits and credit to the private sector.

Deposits are up to sh5.2 trillion in December last year from sh697.1b in January 2000, Lending has followed a similar trend, jumping nine-fold to sh5.1 trilling, from sh567b during the same period.

The numbers manufacturing, construction, the hospitality business, electricity and water supply will show an almost similar growth pattern.

In my mind, two things are clear. One, that tremendous growth, while tempered by our population growth, has happened in the last 10 years.

Also interesting to me is that we have achieved this growth despite our low indicators in road and rail coverage, availability of power, under developed financial and commodity markets and other deficiencies.

Looking forward to the coming decade, we are going to have to sustain this growth curve, while also improving the distribution of these benefits around the population.

For starters, the infrastructure deficits need to be narrowed, and the fight against corruption to be intensified – because the leakages in public finance is slowing the distribution of economic gains, concentrating them in the hands of a handful of well positioned and connected individuals.

In addition, we need to, not only nurture new entrepreneurs, but push our existing crop to a higher level, through education and support. You can have all the roads and markets in the world at your feet, but without risk-takers, the benefits will never be enjoyed.

There is a lot that we can criticise in this country – not least of all that the growth of the last decade is being enjoyed disproportionately by an urban elite – but the general trajectory seems to be in the right direction.
All we need to do is to maximise the benefits to the wider population.

Private sector loan growth rises
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A Christex Garments Industry employee operating a stitch-printing machines.
By Ibrahim Kasita

THE private sector is the engine of economic growth, goes the saying. And indeed sustained economic growth reduces poverty though job creation and paying taxes for national progress.

That explains a continued trend of commercial banks extending loans to the private sector, a move that has spurred consumption and investments.

The total stock of the loans disbursed to the private sector crossed the sh5 trillion mark in October, up from sh4.8 trillion recorded in September 2010.

This, according to Bank of Uganda financial indicators, was more than the loans disbursed in November 2009, which stood at sh3.8 trillion.

“The annual and monthly growth rate continued to rise,” the monthly economic and financial indicators for the month of November stated.

“This is likely to auger well for economic activity in the near term, given that credit plays an important role in private consumption and investments.”

The biggest drivers of this growth in credit are trade, commerce, construction, manufacturing, transport, communication and agriculture.

This is reflected by a number of micro, small and medium enterprises, which account for 99% of private businesses.

Statistics also indicated that personal loans share of credit continued to fall due to “decreases in car loans and loans for non-durable consumer goods and services”. Personal loans declined by 2% in October, compared to a decline of 18.8% in September 2010.

“The number of applicants for credit and the value of applications also indicates a high growth rate for demand for credit,” the report observed.

The number of personal loan applicants in October last year increased to 22,154, with a value of sh1.3 trillion. This was more than the April applications, which stood at10,825 and were valued at sh578.18b.

Weak deposits
However, the shillings denominated savings deposits did not grow in October, while that of hard currency denominated savings deposits slightly declined to 2.3% from 2.4% in September.

The shillings time and saving deposit remained at sh2.8 trillion in October as it was in the previous month in 2010.

The stability in time and saving deposit could be mainly due to the low interest rates compared to average lending rates.

The weighted average lending rate, excluding personal loans, rose close to 20% in October, compared to shillings denominated savings deposit, which averaged at 1.5%.

Poor saving culture is bad because it reduces the return on money (no interest) however small the interest paid is.

Increased saving helps small businesses (SMEs) borrow to expand their operations, develop new products and employ more Ugandans.

Every $1 invested in an SME generates an additional $10 in the local community and $1 of SME finance creates three times more jobs.

Firm lines Shs11b for food processing plant
By Stephen Wandera (email the author)
Posted Monday, January 10 2011 at 00:00
Britinia Allied Industries a consortium of food processing firms has lined up a Shs11 billion for the construction of a fruit juice processing plant in Namanve.

The project expected to create about 1,500 for Ugandans is in its advanced stages and it is expected to boost farmers’ incomes especially those involved in passion fruit, orange, mango and apple farming.

Mr Hasmukh Dawda, the chairman of House of Dawda the Britania industries parent company, told journalists last week that the plant would boost farmers’ production capacity, from which the firm will source its raw materials for juice production.

The plant with a capacity of 30 tonnes of pulp will produce mango, pineapple and passion juice.
Mr Dawda, said: "We have already trained farmers on how to grow quality fruits to keep production in line.

He disclosed that because the firm has experienced supply shortages for passion fruits, management took a decision to suspend the production of Splash passion juice.

Mr K. R Sridharan, the Britannia Allied Industries marketing manager said the firm is also keen on extending to DR Congo and South Sudan.

Cement price expected to drop with new plant

President Museveni unveils the plaque at a function to commission the new cement plant in Kasese last week. PHOTO BY ISAAC KASAMANI.

By Ismail Musa Ladu (email the author)
Posted Monday, January 10 2011 at 00:00
Cement prices are expected to drop following the commissioning of a new plant by Hima Cement. The plant in Kasese District is expected to boost the construction industry with an expected drop in the price of cement as a result of increased production.

Cement, a major construction material has witnessed a volatile price trend forcing a retail price of 26,500 in the later part of December 2010.

Mr Hussein Mansi, the Larfage chairman, said the Shs280 billion plant will not only increase supply for the local and regional markets, but will also see prices become more competitive, especially if the government continues to lend support to local investors against an influx of cheap imports.

Mr David Njoroge, the general manager of Hima Cement, said with the plant already in operation, the impact of increased production from a previous capacity of 350,000 tonnes a year to 850,000 tonnes is already showing some benefits to Ugandans.

He said: “With a daily average of 500,000 bags, the price of cement has already dropped from a high of about Shs30,000 to about Shs26,000.”

“This is a good start, and as other factors that increase the cost of production get sorted, it will not be long before prices further drop.”

However, despite the increase of cement production, observers say prices must further drop in order to genuinely develop the construction.

Observers say current prices make it hard for a common man to build a house for himself. However, industry players maintain that this is a good start, which will see the cost of cement drop further as prices tagged on the cost of doing business improve.
While opening the plant, President Museveni promised to engage regional leaders on the Common External Tariff, after Mr Mansi cited it as a move that will increase regional competitiveness.

The President, who was upbeat about the number of jobs to be created also, said that by next year the cost of power will have drastically dropped, as the government commits to seeing Bujagali operational by 2012.

“Beginning next year, the cost of power will be more competitive matching that of Asia where it is cheaper.”
He also promised to fix roads and later embark on the railway construction, as he said industrialisation is the way to go.

The new automated plant, according to Hima Cement is environmentally friendly. It internally treats its emission, meaning that there will be no harmful discharge of dust to the environment.

The plant is expected to generate about Shs1 billion as the government revenue.

Last edited by u.g boy; January 10th, 2011 at 10:16 AM.
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Old January 10th, 2011, 11:15 PM   #532
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Karimojong urged to embrace development
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By Olandason Wanyama

RESIDENTS of Nadunget and Rupa sub-counties in Moroto have been asked to embrace investment so as to develop themselves and also leave behind something for the generations to come.

The resident district commissioner, Nahaman Ojwe, made the call in an outreach meeting on Friday at two separate venues.

He was sensitising communities on the implementation of the new National Agricultural Advisory services (NAADS) programme at respective sub-county headquarters.

“The Government has done a lot by building schools and health centres at different levels,” he said.

He added that peace had returned, thanks to the disarmament exercise and the recruitment of the youth into local defence units.

Ojwe explained that the roads had become safer because there were no more ambushes.

“Electricity has also been brought, meaning that industries must follow to solve the unemployment challenges,” he noted.

On poverty among the Karimojong, Ojwe said the Government had earmarked it as the area’s biggest problem.

“We have now brought NAADS for all households to benefit,” he said, amidst cheers.

Ojwe said the re-introduction of the project would help fight poverty.

President Yoweri Museveni last year was in the region to assess the performance of the prosperity-for-all projects.

He, however, was unhappy with the implementers of the project in Karamoja.

Ojwe assured the residents of plans to set up multi-million-shilling investments in Karamoja for community benefit.

He said the National Resistence Movement government would ensure job creation remains a priority on its agenda.

Ojwe appealed to the people to abandon alcoholism, saying that it had enslaved them economically.

He urged residents to work hard to eliminate poverty and improve their well being.

NARO Technology centre opened
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By Esther Mukyala

AN Agricultural technology demonstration centre worth $ 6m has been opened at the National Agricultural Research Organization in Kampala to research into quality fish production.

Speaking at the opening ceremony, fisheries state minister Fred Mukisa said Uganda was likely to experience a shortage of 600,000 tonnes in fish food by 2015.

Mukisa called for a change from subsistence aquaculture to a market and technology driven industry.

The Chinese ambassador to Uganda, Sun Heping, said China was committed to supporting Uganda’s efforts for sustainable development, especially in agriculture.

Since 2007, China has trained over 400 Ugandan agricultural experts.

The centre has over 90 fish ponds and a feedmill.

Kyenjojo farmers get boost
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Mwesige (left) showing guests the solar-dried pineapple chips at the launch
By Hope Mafaranga

FARMERS in Kyarusozi sub-county in Kyenjojo district will start earning more money from their produce after they got solar driers to add value to their products.

The farmers, under the Kyembogo Farmers Association (KYEFA), will start drying pineapples, vegetables and bananas to improve the crops’ market value and shelf life.

Matthias Mwesige, the KYEYA project manager, said farmers were engaged in pineapple, mango, maize, banana and vegetable farming.

“This is a great opportunity for us because we have been selling our pineapples between sh500 to sh1,000, but after drying them we will be earning sh5,000 from the local supermarkets and sh10,000 from the exports,” Mary Tinka, one of the pioneer farmers, said at the launch of the solar driers on Friday.

The driers were donated by World Education Bantwana Initiative, a non-governmental organisation operating in Kyenjojo.

Mwesige said the association and Bantwana had already secured market for the produce and plans were underway to start exporting dried pineapples and bananas.

He said the NGO had also supplied seeds and pineapple suckers to the farmers, adding that the farmers had also been trained in modern farming.

Mwesige said the development would help rural farmers attain socio-economic growth; improve their income and food security.

The group started with 30 members in 1998, but it has grown to 2,000 members.

Predictions for 2011 reflect a rosier and vibrant economy in most sectors

The 250MW Bujagali Hydro Power project is scheduled to start generating 50MW of power in October promising cheaper and reliable power for Ugandans. File Photo

By Walter Wafula, Faridah Kulabako, Dorothy Nakaweesi, Ismail Musa Ladu and Martin Luther Oketch. (email the author)
Posted Tuesday, January 11 2011 at 00:00
The past few years have seen significant changes in the way companies do business. Challenges such as economic downturns, decreasing revenues, and regulatory uncertainty have sparked fear among many. Now that 2011 is here, Business Power brings you predictions on what the
New Year might have in stock for the business community.

Many company executives will agree that 2010 was a better year in business compared to the previous year due to a slight recovery in the world economy. They, therefore, expect to ride on the gains that were attained to record stronger sales and profits.

However, businesses and economies will continue to feel the pinch of the remains of the global recession that was largely seen off last year. For instance, the Uganda shilling weakened to the highest level against the dollar, the Euro and the British pound, due to challenges in the economic structure of Europe and the United States.

These challenges have affected the cost of doing business and consumption patterns to-date. Yet, the currency crisis is not about to ease to the 2008 levels (1$/Shs1,800) as Business Power reveals.

But the currency market is just one of the key aspects of the economy that will have a significant impact on business operations and consumption patterns by businesses and consumers in 2011.

This is an election year for both Uganda and her major export destination; South Sudan - which conducted its referendum elections on Sunday. Internally, the success or failure of many planned developments and occurrences will largely depend on the way Uganda will conduct and treat results from the upcoming presidential and parliamentary elections come February 18.
Exports in balance
Ms Florence Kata, the chief executive officer of the Uganda Exports Promotion Board (UEPB) told Business Power last week that the result of the South Sudan referendum elections has major implications for Uganda’s growing exports.

“If the referendum goes on well, trade will continue to flow normally but if turns out chaotic then it will throw a curse on our trade,” she said. South Sudan has been Uganda’s leading export market destination for the last two-years. In 2009, Uganda earned up to $184 million from exports to Sudan compared to $172 to Kenya. Uganda largely exports food stuff and merchandise to the Great Lakes region. A peaceful election is expected to result into increased exports following a bumper harvest by Uganda last year.
Infrastructure boom
The call for value addition could pass for a cliché in Uganda. For many businesses, that can only be successfully achieved with sufficient power and a good transport network to key markets like Sudan. This year, a total of 88 Mega Watts (MW) of power will be generated from various hydro power stations in 2011. The 250MW Bujagali Hydro Power project is scheduled to start generating 50MW of power in October this year. However, this will be preceded by the launch of smaller mini hydro power projects including; Mpanga Hydro Electricity Project (18MW) in Kamwenge District, Ishasha (6MW), Buseruka (9MW) and Nyagak (5MW). The power projects are expected to increase Uganda’s total installed electricity capacity from 595MW as of last year, to 875MW by 2012.
Mr Simon D’ujang, the state minister of energy, predicted that the launch of projects like Bujagli will bring down the cost of power by almost one third. A reduction would cut back the operational costs of many businesses and increase their profitability and investments.

Following persistent outcries by the business community about the high cost of transportation of goods, the government plans to upgrade from gravel to tarmac at least 309 kilometres of road and also complete the reconstruction of some 805 kilometres in the country.

Major works will include; the construction of the 4 lane Kampala-Entebbe Super Highway (53km) with a spur to Munyonyo, upgrading of the Kampala-Jinja highway, tarmacing of the Fort Portal – Bundibugyo – Lamia road (104), Tororo – Mbale – Soroti (152km), and the 128km Lira – Kamdini – Gulu road. The construction of major highways linking Uganda to Congo, South Sudan, and Kenya is expected to reduce the cost and time of doing business and boost regional trade.

Fuel costs head up
Uganda is a net importer of petroleum products and like last year, fuel prices are expected to rise based on the global price. A barrel of oil on the international market rose from $70 at the beginning of last year to about $94 by the end of last week.
Global financial services firm Morgan Stanley, expects the price of oil to rise to over $100 (Shs230, 000) per barrel in 2011.

An increase or reduction in the global price of oil normally has a medium term impact on fuel imports to Uganda in the same direction. A rise in the cost of oil per barrel will directly impact transportation costs and distort budgets. In Kampala, a litre of petrol is currently oscillating between Shs3,050 and 3,150 while diesel is between Shs2,400 and 2,550. These prices are seen edging higher due to the global trend. In Uganda, petrol prices could shoot up this week following a supply shortage.
Ugandans can only hope for better fuel prices when Tullow Oil kicks off the country’s commercial oil production next year.
The company is optimistic that the tax dispute between Heritage Oil and Gas, and the government will be resolved this year to enable it fast track its production activities off the Kasamene oil wells. Oil production is expected to translate into higher foreign exchange revenue for the country and reasonable fuel prices at the pump.

Oil and Gas industry development
The government will officially invite companies that have the capacity to fund and construct a $4.6 billion refinery in Uganda. The refinery will be developed on a public-private partnership basis in Hoima District starting in 2012. The government will pass a new legislation governing access to oil and gas rights, regulation of exploration and production, refining and gas processing, environmental management as well as the management of petroleum revenues.

To drive the oil and gas sector forward, the government is planning to set up the Petroleum Regulatory Authority to regulate the sector, as well as the National Oil and Gas Company to participate in the oil business.
National Budget on course
The development of these institutions like any other economic projects requires government finance. With about six months to the close of the financial year 2010/2011, there’s evidence that the government will meet its revenue collection targets for the first time in three years.

According to Uganda Revenue Authority’s latest collection performance reports, the tax body is already way above its target. This implies that the Shs5 trillion target is not beyond reach. The improved performance means that government could ably finance key infrastructure projects in the current and next financial years.

Telecom wars to persist on:
Tax revenue was one area that suffered from a reduction in telecommunication charges by mobile operators last year as millions of Ugandans benefited from price wars in the industry. MTN Uganda anticipates that price competition will persist in 2011 while other telecoms believe the key focus will be on improving the quality of services. MTN’s Chief Marketing Officer, Mr. Isaac Nsereko told Business Power that telecommunication prices will reduce further this year like it has happened in the last 12 years. Mr Edouard Blondeau, the Chief Officer Strategy at Orange Uganda said prices will only fall if inter-connection fees fall below the current Shs131.

Macroeconomic stability
A reduction in telecom prices would partly help the Bank of Uganda (BoU) to tame inflation as was the case in 2010. Last year, Uganda’s inflation dropped to less than 5 per cent from 12.5 per cent in 2009, due to increased domestic production coupled with prudent management of the economy. This year inflation is projected at 4.5 per cent by the International monetary Fund. But the weakening shilling and rising costs of fuel products are seen pushing the inflation level higher in the months ahead. This will adversely affect interest rates on loans, Treasury Bills and Bonds as the central bank moves to scale back the amount of money in circulation.

In 2011, forex dealers foresee the Uganda shilling weakening further against major global currencies. Dr. Adam Mugume, the director research at BOU expects the shilling to follow global trends and developments affecting major world currencies. As of last week, one dollar was worth Shs2, 315 almost in the same range as close of last year.

The above aspects will largely affect investment and developments by major players in the country and of course the final income of each Ugandan. With increased investment in key sectors like manufacturing and construction, the government expects the economy to grow at 6.4 per cent up from 5.9 per cent last year. In comparison, East Africa is seen growing at 5.4 per cent in 2011 with Tanzania at the forefront.
However, Uganda’s chances of attaining its economic growth targets are heavily reliant on its ability to conduct free and fair elections next month otherwise it could turn out to be a chaotic economy like Kenya was in 2008. Going by the Afrobarometer polls, President Museveni is expected to win the election that has attracted 8 contestants. As chief executive of the economy, his presidency is associated with relative stability and growth.
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Old January 11th, 2011, 07:49 PM   #533
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In 2011, shall we see the emergence of Islamic Banking?
By Nathan Were (email the author)
Posted Tuesday, January 11 2011 at 00:00
Recent reports have indicated that the central bank will soon move to regulate an Islamic commercial bank. What exactly is involved in Islamic banking?

Globally, the assets of Islamic banks have been expanding at double-digit rates for a decade and Islamic banking is increasingly becoming a visible alternative to conventional banks in Islamic countries and countries with many muslims.
Islamic banks serve muslim customers, but are not religious institutions. They are profit-maximising intermediaries between savers and investors and offer custodial and other traditional banking services. The constraints they face are, however, different and are based on Shariah law. There are four main features that differentiate Islamic banking from the conventional banks.

Prohibition against interest (Riba) is the major difference between Islamic and traditional banking. Islam prohibits Riba on the grounds that interest is a form of exploitation and is inconsistent with the notion of fairness. This implies that fixing in advance a positive return on a loan as a reward for the use of one’s money is not allowed.

Prohibition against games of chance (Maysir) and chance (gharar): Islamic banking bars speculation - increasing wealth by chance rather than productive effort. Maysir refers to avoidable uncertainty; for example, gambling at a casino. An example of gharar is undertaking a business venture without sufficient information.

Prohibition against forbidden (Haram) activities: Islamic banks may finance only permissible (Halal) activities. Banks are not supposed to lend to companies or individuals involved in activities deemed to harm society (for example, gambling) or prohibited under Islamic law (for example, financing construction of a plant to make alcoholic beverages).

Payment of some of the bank’s profits to benefit society (Zakat): Muslims believe in justice and equality in opportunity (not outcome). One way they do this is to redistribute income to provide a minimum standard of living for the poor. Zakat is one of the five tenets of Islam. Where Zakat is not collected by the state; Islamic banks donate directly to Islamic religious institutions.

In countries with significant muslim communities like Uganda, many large segments of muslims do not have access to adequate banking services-often because devout muslims are unwilling to put their savings into a traditional financial system that runs counter to their religious principles. Islamic banks seek to provide financial services in a way that is compatible with Islamic teaching, and if Islamic banks can tap that potential clientele, that could hasten economic development in these countries.

There is evidence of close correlation between financial sector development and growth. Countries whose financial systems offer a variety of services tend to grow faster. Banks, whether Islamic or traditional, play a fundamental economic role as financial intermediaries and as facilitators of payments.
The rise of Islamic banking has contributed to economic development in two main ways. One key benefit is increased financial intermediation. In Islamic countries and regions, large segments of the population do not use banks. The Islamic world, as a whole, has a lower level of financial development than other regions—in part because conventional banks do not satisfy the needs of devout Muslims.

Moreover, because Islamic banking requires borrowers and lenders to share the risk of failure, it provides a shock-absorbing mechanism that is essential in developing economies. A mechanism that allows the sharing of business risk in return for a stake in the profits encourages investment in such an uncertain environment and satisfies Islam’s core tenet of social justice. If Islamic banking can emerge, Muslim businesses stand to benefit.
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Old January 11th, 2011, 11:07 PM   #534
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EAC lines $3.2m for infrastructure development
By Justus Lyatuu (email the author)
Posted Wednesday, January 12 2011 at 00:00

The East African Community has earmarked $3.2 million for the preparation of an EAC transport and facilitation strategy.

The programme funded by the East African Development Bank (EADB) aims to attain international standards for the EAC road infrastructure and ensure similarity of operational outputs, which would make them user friendly to stakeholders.

Speaking at a ministerial meeting in Kampala recently, Ms Hafsa Mossi, the chairperson of the EAC council of ministers said EADB agreed in 2007, to fund studies on the preparation of an EAC transport strategy and a regional road sector development programnme.

According to a press statement posted on the EAC Secretariat website Ms Mossi said the funds assigned for the execution of the programmes will involve all modes of transport including roads, railways, aviation, maritime, inland waterways and oil pipelines.

The two sets of strategies will also contain recommendations on the institutional and regulatory reforms needed for the project’s implementation.

Britania lines Shs11b for food processing plant
By Stephen Wandera (email the author)
Posted Wednesday, January 12 2011 at 00:00

Britinia Allied Industries a consortium of food processing firms has lined up a Shs11 billion for the construction of a food processing plant in Namanve.

The project expected to create about 1,500 for Ugandans is in its advanced stages and it is expected to boost farmers’ incomes especially those involved in passion fruit, pineapple, orange and apple farming.

Mr Hasmukh Dawda, the chairman of House of Dawda, Britania’s parent company, told journalists last week that the plant would boost farmers’ capacity, from which the firm seek to source its fruit juice raw materials.

The plant with a capacity of 30 tonnes of pulp will produce mango, pineapple and passion juice. Mr Dawda, said: "We have trained some farmers on how to grow high quality fruits so as to promote quality. He disclosed that because the firm has experienced supply shortages for passion fruits, the firm’s management recently decided to suspend the production of Splash passion juice.

Mr K. R Sridharan, the Britannia Allied Industries marketing manager said the firm is also keen on extending to DR Congo and South Sudan.
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Old January 11th, 2011, 11:12 PM   #535
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500,000 cars hit Ugandan roads in 20 years
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By Joel Ogwang

THE number of vehicles plying Ugandan roads has increased by over 500,000 (100%) in the last 20 years. According to the Uganda Revenue Authority (URA) estimates, there are 635,656 vehicles in Uganda today, an increase from 50,102 in 1991.

Light goods vehicles have increased by 5.7% in the last 10 years. Four-wheel drive cars went up by 7.4%, Omnibuses 12.6%, buses 5.4%, trucks 9.2% and motorcycles 15.8%.

Experts predict that this trend will continue owing to the unreliable public transport system, cheap car loans and the mushrooming depots dealing in new and used cars.

Sam Katumbwe, a transport expert in Kampala, however, said the increment in the number of cars did not necessarily mean Ugandans were growing richer.

“One person may own over 10 cars,” he said.

The Ministry of Works acting director of transport, Godfrey Wandera, said commercial passenger and goods transport by road is exclusively done by the private sector.

“Passenger transport is mainly dependent on the Omnibuses (Kamunyes) and taxi-motorcycles (boda bodas),” he said.

There are 112 registered car bonds, according to URA.

However, this year, the tax body shut registration of new car bonds.
“For now, we are not licensing any car bond because the ones available can satisfactorily meet the demand,” says Peter Kaujju, a media management officer at URA.

About 50% of vehicles in the country operate in the Kampala Metropolitan Area composed of Kampala city, Entebbe, Wakiso, Kira and Mukono town councils.

At 3.9%, the city’s current population growth rate is above the national 3.2% threshold, justifying the population’s rise from 400,000 in the 1950s to the estimated 2.5 million currently.

However, many city employees reside outside Kampala.

To exploit the fertile public transport industry, companies like Pioneer Easy Bus introduced 60-seater passenger buses, plying the Kampala-Entebbe, Kampala-Gayaza and Kampala-Mukono routes.

Road transport is the commonest and cheapest means of transport in Uganda.

Because of this, many roads have degenerated due to the pressure from the increased number of vehicles.

Works minister John Nasasira recently said: “Kampala roads are negating all the progress we, as a country, are making economically.”

The Government has tarmacked 1,000kms of roads in the last 20-years but this cannot match the over 100% increase in vehicle population.

The increase in the number of vehicles has caused traffic jams, which worsen during peak hours.

“Very soon, people walking on Kampala roads will be faster than cars,” says Eng. Francis Baziraake, the Uganda Road Fund (URF) board chairman.

Due to jams, Uganda loses about sh500m daily in burnt fuel, according to the state of environment report by NEMA, the national environment watchdog.

The situation is worsened by motorcycles, which many people resort to in an attempt to beat the jams.

“Motorbikes are hazardous and add to the traffic congestion, air pollution and disorganisation in urban centres,” the NEMA report said.

Cost of doing business will fall – Museveni
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Museveni (in hat) with other officials touring the new Hima Cement factory recently
By Vision Reporter

PRESIDENT Yoweri Museveni has assured manufacturers that the Government is striving to reduce the cost of doing business to enhance the country’s investor confidence.

He was optimistic that investors will enjoy less power costs with the completion of the 250-mega watt Bujagali power dam, which is one of the power projects underway countrywide.

Museveni was responding to pleas by Hima Cement chairman Hussein Mansi, who asked the Government to intervene and solve the problem of high energy tariffs.

This was during the commissioning of the firm’s $120m (sh280b) cement factory in Kasese district last week.

The new investment has increased the company’s production capacity to 850,000 tonnes, up from 350,000 tonnes.

Mansi was also concerned about the delay in improving the Kamwenge-Dura-Rwimi road, which he said was hampering the company’s operations.

He said the high energy and transportation costs make Uganda’s cement less competitive on the international market.

“It costs five times more to transport a tonne of cement in East Africa compared to China. Electricity in Uganda costs three times the cost in China,” he said.

Mansi said the unlevelled playing ground has compelled regional cement producers to request the East African Community to put a tariff of 35% or $50 per tonne on cement imports.

According to Mansi, the new cement factory, which started operations in July last year, created over 500 jobs for local residents.

“The factory employs over 600 permanent staff and has created more than 3,000 indirect jobs,” he said.

Standing on a 20-acre piece of land, the investment will fetch the country over $140 revenue annually.

Hima will also spend $1m every year in funding community development projects through the social responsibility programme.

The President said the revenue from Hima Cement alone was almost half of the total revenue from the entire coffee industry in the country.

Defense minister Dr. Crispus Kiyonga noted that Hima’s investment was a significant answer to the Government’s industrialisation call.

Kiyonga also commended the company for buying coffee husks from the local communities, which are used to burn the cement.

“We must encourage our people to grow more coffee to earn extra money from selling coffee husks to the factory,” Kiyonga advised.
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Old January 11th, 2011, 11:18 PM   #536
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Government offers Shs900b to change city transport network
By John Njoroge (email the author)
Posted Wednesday, January 12 2011 at 00:00

A flyover will be constructed to connect the Jinja Road junction to Entebbe Road over the Clock Tower as part of the government’s master plan to resolve Kampala’s troubling transport network system.

According to a new Shs900 billion transport master-plan, to be implemented by the Uganda National Roads Authority (UNRA), this project should be complete by 2023. According to the UNRA spokesperson, Mr Dan Alinange, the first phase of the project, designing the routes, is expected to begin in April and last a year.

This 20-kilometre phase, he said yesterday, will be named the Bus Rapid Transport system and will cost $100 million. The project is co-financed by the World Bank.

Other flyovers will be constructed connecting Jinja Road to Yusuf Lule Road, Yusuf Lule Road to Mukwano Road and Mukwano Road to Jinja Road. The designs for these flyovers have been completed and are awaiting financing.

The master plan involves total construction and rehabilitation of the transport network systems of Kampala city. The plan embraces both the road and railway network.

Future plan
“The Greater Kampala Master Plan is based on an evaluation of the desired future of Kampala City,” said Mr Alinange. “The plan is to reconstruct all Kampala roads by 2013. We are working with our partners to source for funding,” Mr Alinange told Daily Monitor.

Several other projects will be undertaken in the decade after 2013, including the road from Munyonyo to Entebbe—the Entebbe Expressway. The $300 million project is awaiting Cabinet and parliamentary approval. A loan agreement has been signed with the Chinese Government pending approval.

UNRA says if any buildings are affected in this phase, their owners will be compensated. Two other scenarios will be incorporated in the Kampala redesign.

Also expected is identification of convenient commercial and industrial locations to create out-of-town growth poles thereby reducing journey times to work and encouraging the development of circumferential roads. Also to be created is a metropolitan transport authority.

In a total area of 970 square kilometres, Kampala’s population is expected to reach 4.5 million by 2023. Notably, the main population growth of the city has been in the outer ring of Kampala District and in a belt along Jinja Road towards Mukono. According to 2008 calculations, the estimated number of minibuses operating in Kampala had reached about 8,000. These were supplemented by over 16,000 boda bodas.

An estimated 100 vehicles were using major Kampala roads every hour. According to officials, some of these roads were constructed in the late 1960s and were meant to last only 10 years.
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Old January 12th, 2011, 08:45 PM   #537
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WFP's grain purchases rise 30% in 2010
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KAMPALA, (Reuters) - The World Food Programme (WFP) said today its food purchases from Uganda rose 29.6 percent in 2010 from the previous year boosted by an increase in donations to the U.N. agency.

Uganda harvested a bumper maize crop during late 2009 and the first quarter of 2010, flooding markets and triggering a plunge in prices.

The body said it purchased an estimated 153,000 metric tonnes of food last year, mostly maize and beans, compared with 118,000 metric tonnes bought in 2009.

"Thanks to increased cash donations in recent years, WFP has become Uganda's largest buyer of quality grain for operations in the country as well as for operations elsewhere in Africa," the statement said.

WFP's country director, Stanlake Samkange, said Uganda was the organisation's biggest grain supplier in Africa, excluding South Africa.

The agency did not give the value of its purchases in 2010 but had forecast spending between $60-$70 million.

Over the last several years, WFP has been steadily boosting its local food purchases, a strategy it says has enabled it purchase larger volumes and feed more people from money saved on costs incurred in overseas food shipments.

Sourcing grain locally, the WFP says, also helps tap into the potential of local agriculture and boosts the economies in which the organization operates.

"Local purchasing under WFP's Purchase for Progress (P4P) initiative encourages smallholder farmer groups to widen their opportunities to access agricultural markets," the statement said.
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Old January 12th, 2011, 11:14 PM   #538
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When a rebrand becomes necessary

Zain recently rebranded to Airtel. Though rebranding is costly, some times it is inevitable especially when it involves an acquisition or a takeover.

By Faridah Kulabako (email the author)
Posted Thursday, January 13 2011 at 00:00
“What’s in a name? That which we call a rose, by any other name would smell as sweet.” There goes Shakespeare’s phrase in Romeo and Juliet.
Shakespeare’s phrase may be true but how many consumers would take time to smell a flower or brand that has a repelling name?

Such a scenario is true for corporate branding and rebranding.

Several companies in Uganda have undergone rebranding efforts in recent years, varying from complete, top-to-bottom repositioning to more minor changes that nevertheless have far-reaching effects.

For instance, in December last year, PricewaterhosueCoopers changed its look to a simplified logo consisting of initials “PwC” whereas Zain Uganda underwent a complete face lift to Airtel in the same month.

Other companies that have been revamped in recent years include insurance service provider AIG which rebranded to Chartis, Stanbic Bank which ditched its tagline from “Inspired Motivated. Involved” to “Moving forward” while Standard Chartered Bank changed its slogan from “The right partner” to “Here for Good”.
National Housing and Construction Company limited (NH&CCL) rebranded to National Housing (NH), The Monitor changed to Daily Monitor while The New Vision redesigned and changed its name to New Vision to mention but a few.
Ms Agnes Kamya, a marketing and advertising manager at Revolution Ads and Design Limited told Smart Money recently that revamping a company brand may be necessary if there is change in management or when a brand has outgrown its identity.

“Brands may start small but after some time they grow and may require rebranding to match growth with the brand,” Ms Kamya says.

She further notes that firms may also consider a rebrand in a bid to ensure that companies and brands remain relevant to their target audience.

“When your target audience evolves and starts to sniff out competitors, it may be because they feel what was their first preference is no longer relevant.
A rebrand to give your company a new face in such a case is required,” she explains.

The decision to rebrand is, however, much more than just a change of logo and can necessitate making changes to the very heart of a company.
Mr Emmanuel Masaba, a branding expert told Smart Money recently that like any image overhaul, a rebrand can enable a company to update its message, signal a change in direction or appeal to new audiences.

Depending on a company strategy, he says, a rebrand can be a way of repositioning a brand in the market to appeal to a wider audience or to redefine a company for reasons such as bankruptcy.

Taking a brand to a new position, he adds, requires a company to think about the new audience they are hoping to acquire before implementing the new brand.

Rebranding also shows a company’s audience, both current and future, that it’s adaptive to change. This is true especially for companies whose brand is dependent upon technology.

Since a corporate identity is the most visible and outward sign of a company, changing or overhauling an identity says a lot about the company’s present and future direction.

Thus, a brand is not just a logo, advertising campaign or slogan. It is rather a product of the millions of experiences a company creates with employees, communities and customers and the emotional feeling these groups develop as a result of their experiences.

Mr Francis Kamulegeya, the country senior partner at PwC Uganda says the refreshed visual look aims to differentiate PwC and reinforce the firm’s efforts to deliver distinctive services through building relationships and creating value.
According to Stanbic Bank’s managing director Philip Odera, the bank’s rebranded slogan aimed at “making the right connections” inspired by the need to focus the mindset of the bank’s staff towards improving customer service and delivery.

Recently Mr Odera was quoted by the Daily Monitor, as saying: “Moving Forward is meant to reaffirm our commitment to deliver the best services to our customers.”

The rebranding of NH&CCL to NH came with an ambitious plan where the NH plans to build over 2,000 housing units by 2012.

Although rebranding gives companies new identities to expand their appeal in local, regional and international markets, Mr Masaba says casting off old brands also presents huge risks including losing some customers in the short run.
He notes that rebranding may also affect a firm’s financial goals whereby consumers may take long to familiarise themselves with the new brand and in the process the firm may lose revenue.

Although required sometimes, Ms Kamya, however, argues that rebranding is costly, may confuse consumers and that accepting the new brand, especially for people who are not well informed requires a lot of advertising and sensitisation.
However, companies should not rebrand for the sake of rebranding without any new innovation, attitude, behavior or product position as it might leave consumers with a flat experience.
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Old January 13th, 2011, 12:04 AM   #539
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Oil and development: The changing face of Hoima
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Construction of commercial buidings in the city centre is booming and people are settling in to benefit trom the oil
By Thomas Pere

A VACANT tract of land lies between the welcoming town council sign and the town centre.One can think Hoima town is still a distance away. The discovery of petroleum in the district, a few years ago, brought Hoima to fame.

The town is now a centre of diverse activities, such as construction, especially in residential areas. Newly painted buildings, unfinished roof tops and growing gardens are common.

“Unlike most towns and cities where the settlement pattern starts with low-class housing and transforms into suburbs, Hoima town is different,” Allan Mubiru, a visitor to the district says.

The town centre is dominant with non-storied commercial buildings, although some storied buildings have cropped up.

“These buildings are not more than five years old. They have replaced the houses that got burnt.,” William Isingoma, a resident says.

He adds that since the discovery of petroleum in the district, there is a change. The prices of land have shot up due to high demand. People have moved from all over the country and settled in the district in order to benefit from the from oil,” Isingoma says.

He says there are four main residential areas in Hoima which include Kijungu, Bwikia and Bujumbura, domainated by the middle class. Surprisingly, there are hardly any slums except Kiriatete village where many low-income dwellers reside, Isigoma says.

However, with the onset of the oil industry, it is feared large scale slums might rise.

At the periphery of the central business district, there are visible signs the town is expanding. The residential areas are still growing.Many of the structures are typical of the district standards. Few isolated residential properties can march the standards of Kampala.

Boneventure Kiiza, the acting municipal engineer of Hoima district, says getting a vacant plot in the town is difficult. Instead, it is plots with buildings in them that are available. However, vacant plots are still available in the residential areas, although expensive, costing over sh5m for a 50ft x 100ft plot and sh60m for a 60ftx100ft plot in the town centre, he says.

Since the town council which used to be 20-50sq kilometres became a municipality, its size has expanded. The population has risen from 36,000 to about 101,000. The road network also expanded from 114km to over 220 km, although many of the roads are in a pathetic condition.

The road to Kampala is the only tarmacked one, but also in a worrying state. Since the discovery of oil, many organisations have come up. They are doing consultancy on land and creating awareness.

The residents hope their land will appreciate and have started investing in it, Kizza says. Building materials like sand and bricks are available in haredware shops.

A three tonne truck of sand costs between sh70,000 and sh90,000 and that of aggregate between sh100,000 and sh120,000. A brick costs between sh80 and sh100.

The rates for commercial shops range between sh70,000 and sh150,000, depending on the location, while for lockups, the range is between sh70,000 and sh100,000 per month.

For residential property, the price for two roomed houses range between sh70, 000 and 150,000. Self-contained double rooms range between sh200,000 and sh250,000.

Among the residential areas, Kijungu is the most affluent. and was well planned roads networks.

Kiiza says the biggest challenge is unplanned development and poor infrastructure.
There is limited supply of electricity, but we hope there will be more power with the completion of Seruka dam, says Kiiza.

Ten years to come, there will be significant change in Hoima. This will start with the forthcoming urban infrastructure development project by the Government commencing in 2012.
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Old January 13th, 2011, 06:41 PM   #540
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China to construct $350m Entebbe Road
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Traffic jam on Entebbe Road
CHINA is set to start construction work on a $350 million toll road from Entebbe Airport to the capital Kampala in July in a bid to reduce congestion on the existing road, officials said today.

According to Daniel Alinange, the spokesman for the Uganda National Roads Authority, the government has already signed the $350 million loan with the Exim Bank of China for the financing of the project.

"Preparations are now in final stages and construction will start in July," he said, adding the Chinese will build and manage the toll road.

The existing 50-kilometer road connecting the Ugandan capital to Entebbe continues to be overwhelmed by increasing traffic and is regularly jammed.

According to the Uganda Investment Authority, China is now the country's main source of foreign direct investments and more Chinese companies are eying opportunities in the country's construction, agriculture, and oil and gas sectors.

China's state-owned CNOOC Ltd. has already agreed a joint venture with U.K.'s Tullow Oil PLC and France oil major Total SA to develop the country's downstream oil industry in at least three oil blocks in the Lake Albertine Rift basin.
The deal awaits government approval.

According to Brain Glover, the general manager of Tullow Uganda Ltd., the three companies will invest at least $10 billion in the project, making it East Africa's largest ever single project so far, involving the construction of a refinery and a 1,300 kilometer-long oil export pipeline to the East African coast.
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