Uganda Business, Economy and Infrastructure News

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NWSC to produce power from sewage
Friday, 9th September, 2011
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By Josephine Maseruka

NATIONAL Water and Sewage Corporation (NWSC) will soon start producing electricity from sewage.

The project will start at the Nakivubo sewage plant, which handles 45,000 cubic metres of sewage per day.

Phiona Wall, the corporation’s spokesperson, yesterday said the technology to be used will be able to capture methane – a gas which causes the stench at sewage plants.

“We will capture methane gas and convert it to bio-gas to produce electricity, which will run the plant. The excess will be connected to the national grid,” she explained.

To control sewage bursts in the city, the corporation has started constructing sewage plants at Lubigi, Kinawataka and Nakivubo.

The 82m euros (about sh332b) project is funded by the European Union, the Germany Development Agency, the African Development Bank and the Uganda Government.

MPs on the natural resources committee recently expressed concern over the stench in the city due to sewage bursts.

The Lubigi sewage treatment plant in Kawempe division, which has been resisted by residents and local leaders, will handle 5,400 cubic metres of sewage per day. When completed, it will raise the sewage coverage in Kampala to 33%, up from 7%.

Although residents are blaming the increasing floods on the sewage plant, Wall refuted the claims, arguing: “We are not destroying the wetland. We need it as a filter.”

“The plants will not have structures as most people think. We shall put there ponds, which will not harm the environment. The Kinawataka plant will handle 8,000 cubic metres of sewage,” she said.

Wall said although the Bugolobi sewage treatment plant constructed in 1940 has a capacity of 33,000 cubic metres per day, it only handles 17,000 per day.

“The under utilisation is due to the limited piped connections and obsolete and very old pipes, making the sewage system insufficient,” she explained.

According to NWSC officials, their biggest problem is rubbish disposal, especially in markets, taxi parks and crowded areas such as slums.

Kiyembe in the city centre has been identified as a problematic area. Tailors dump textile cuttings in the sewage line, causing frequent sewage bursts around the Old Taxi Park.

Urbanisation has also affected the dilapidated sewage pipeline, which was initially to serve about 500,000 people.

Encroaching on the NWSC property is also blamed for the sewage bursts, especially in Katanga, a Kampala suburb near Wandegeya, where most students’ hostels have been built on sewer lines.

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Boda-bodas face ban in Kampala city
Monday, 12th September, 2011
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Boda-boda riders on one of Kampala streets. File photo.
By Online Reporter

Kampala City Council Authority (KCCA) is considering a proposal to ban boda- boda (motor bikes) cyclists in Kampala city.

The central business district would be a no-go area for boda-bodas if the proposal is approved. The move is aimed at decongesting the city; reduce accidents as well as restoring order in the city.

Sources reveal that boda- boda cyclistswill not be allowed to go beyond Wandegeya, Makerere Hill Road to LDC, Gaddafi Road, Namirembe Road to Kafumbe Mukasa Road, Clock Tower, Queens’ Way to Nsambya, Mukwano Road to Kitgum traffic lights on Jinja Road, and Yusuf Lule up to Mulago round-about and back to Wandegeya.

Merely two years ago city authorities wanted to ban the boda-bodas but the Police halted the decision arguing that it was made hurriedly and without consultations.



Govt told to invest in coffee
Monday, 12th September, 2011
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Kasamba (left) inspecting coffee stalls during the exhibition in Kyotera on Wednesday
BY ALI MAMBULE

The Government has been asked to invest more funds in coffee growing and production. Kakuuto county MP Mathias Kasamba noted that coffee is the main source of foreign exchange.

He said much as coffee generates $300m in foreign exchange, the Government is not investing enough in the Uganda Coffee Development Authority.

The authority is in charge of maintaining the quality and standard of coffee. Kasamba was addressing farmers and residents of Kyotera town during an exhibition at Stirling in Kyotera town council. The exhibition was organised by the West Buganda Coffee Farmers Cooperative Union.

Kasamba said the coffee authority needed at least sh50b annually to run its activities smoothly. “In this year’s budget, the Government earmarked only sh2b for the authority. Other funds generated by the authority like those from processors and licences add up to about sh7b. In total, less than sh10b is invested in the coffee sector,” he stated.

Kasamba explained that if the sector was to grow and hit the expected target of generating over $500m, there was need to make a strategic intervention. He said this could be done by investing between sh40b and sh50b in the sector annually for the next three years.

Kasamba explained that the funds would be used to establish more multiplication centres for coffee seedlings and enable farmers to get inputs.

He said the money would also be used to expand coffee farms to get better yields, thus increasing revenue.

Kasamba said since most coffee farmers are low income earners who produce the crop on a small scale, they cannot purchase inputs to maintain gardens throughout the year.

He explained that this forces the farmers to sell coffee flowers by getting big loans from the processors or middlemen who eventually take the harvested coffee.

Kasamba observed that this was one of the reasons why Ugandan-grown coffee has always been of low quality.

He urged the Government to help the farmers get inputs.

Kasamba said he plans to supply over three million coffee seedlings to the district in three years.



Broadcasters want competition for digital migration deal
Monday, 12th September, 2011
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By Henry Sekanjako
and Raymond Baguma

BROADCASTING industry players want the Government to review the digital migration project to bring on board more companies for the distribution of digital signals.

This follows a proposal by the Government to grant the national broadcaster, Uganda Broadcasting Corporation (UBC), exclusive rights over the distribution of signals when the country migrates from analogue to digital broadcasting next year.

They argue that competitive bidding, will ensure that the Government gets value for the tax payers’ money.

The industry players, who include the National Association of Broadcasters and Pay TV companies, made their plea while appearing before the parliamentary committee on information and communication technology recently.

The general manager of Multichoice Uganda, Charles Hamya, said: “There is need for more than one signal distributor so that in case of network failure, the other distributor can serve the consumers.”

Last week Parliament unanimously voted against a proposal to grant UBC exclusive rights over the distribution of signals when the country migrates from analogue to digital broadcasting next year.

Presenting the ICT report last week, MP Nathan Igeme Nabeta, the committee chairperson, said a single distributor in countries like Norway had failed to provide the required services.

Parliament heard that in the East African region, Kenya and Rwanda had already approved two digital signal providers, while Tanzania had approved three.


Ugandans eye businesses in Somalia
Monday, 12th September, 2011
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By John Semakula

THE business community in Uganda received the news of AMISOM’s recent victory against the al-Shabaab militants in Mogadishu with a smile of hope.

The community had long wanted to venture into Somalia but the insecurity in the country had hindered it.

When news emerged that the AU peacekeepers had secured 90% of Mogadishu from the militants, managers of various companies in Uganda started drawing business plans for Somalia.

Uganda’s private security firms and the Uganda Export Promotions Board (UEPB) are among local enterprises eyeing the country.

Daniel Karibwije, the UEPB spokesperson, said: “We shall definitely target Somalia in our export promotion business when the country stabilises.”

Moses Matsiko of Pinnacle Security Company said Somalia was the firm’s next destination.

“We shall eventually go to Somalia but after being assured of security,” he said.

Balagadde Kiggunddu of Dreshak Security Solutions said when the company is sure of the security for its recruits, it will venture into Somalia.

He noted that in Iraq and Afghanistan where the firm usually sends its recruits, there are bunkers and demarcated zones where the recruits can hide in case of an attack.

Thousands of Ugandans have gone to work as security guards in Iraq and Afghanistan, a move that has reduced unemployment and boosted the country’s foreign revenues.

AMISOM spokesperson Lt. Col. Paddy Ankunda said there were many opportunities in Somalia which Ugandans can exploit.

Since Uganda is an agricultural country, it could export food to the famine-stricken Somalia, he said.

Currently, the business between the two countries is one sided. Somalis flock to Uganda to carry out business but Ugandans cannot venture into Somalia because of the insecurity.



Load shedding likely to increase
Monday, 12th September, 2011
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By Samuel Sanya
and John Masaba

COMPLEXITIES surrounding the renewal of a water release permit by the water ministry are set to plunge the country into longer load shedding hours.

Valentine Katabira, the operations manager at the Uganda Electricity Transmission Company Limited (UETCL), said discussions were underway with the energy ministry to secure the extension of a permit to release 1,000 cubic meters of water translating into 171megawatts of electricity at the Eskom run Nalubaale hydro power station in Jinja.

Failure to secure the permit extension will see the power generator revert to releasing only 700 cubic metres of water translating into 138megawatts.

“In August, the allowed water releases for Eskom translated into a flat hourly average of 171 megawatts. Effective September 11, the allowed water releases may revert back to an hourly average of 138 megawatts upon expiry of the current release permit variation,” Katabira said in an August 23 letter.

He pointed out that if the permit is not renewed, electricity shortfalls of 40 megawatts will be realised during the day and more than 100mw at night.

The daily energy dispatch schedule shows that the 10 electricity plants in the country are supplying a total 297megawatts with demand projected to rise to 450 megawatts. The recently-commissioned power plants in Ishasha and Mpanga registered zero production on Wednesday.

“The Ishasha and Mpanga mini hydropower dams are projected to produce 6megawatts and 10megawatts of electricity respectively, depending on river flow levels,” Kitabira said.

Willy Kiryahika, the UETCL deputy managing director, in an interview said the energy ministry had come up with interventions to cushion the country from the increased load shedding.

“It is not going to be as bad as was reported in the press,” he said. Efforts to reach the commissioner and the permanent secretary in the energy ministry for a comment were futile as they were reportedly in meeting

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Govt expands Bushenyi prison
Wednesday, 14th September, 2011
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Construction workers preparing a wood panel at Nyamushekyera prison
BY CHRIS MUGASHA

The Government has embarked on the expansion of Nyamushekyera government prison in Bushenyi district. The move is aimed at reducing congestion in the prison.

The facility, that was constructed in the 1950s with a capacity to accommodate 120 inmates, is currently accommodating over 500 inmates.

It serves Sheema, Buhweju, Rubirizi, Mitooma and Bushenyi districts. The officer in charge, Peter Ariko, said two modern blocks for male inmates were under construction.

He said once the construction is complete, Nyamushekyera would be one of the biggest prisons in the region, with the capacity to accommodate over 800 inmates.

Ariko said under the same project, the sewage system would be overhauled while watch towers would be set up in every corner of the prison.

He said as the country’s population continues to grow, the crime rate is also increasing. Ariko said most of the prisoners are youth aged below 25.



Tourisma ministry to revamp the sector
Wednesday, 14th September, 2011
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Balunywa and Kamuntu after the conference
By Agnes Nantambi

The tourism, wildlife and antiquities ministry is re-positioning itself and promoting the country as a top tourist destination. “We want to improve roads going to game parks and other tourist attractions to make them easily accessible to visitors. Power and lodges in those places need also to be improved.

“These will help position the country as an attractive destination to foreigners, which will boost foreign exchange earnings,” Prof. Ephraim Kamuntu, the tourism minister, said.

He also noted that the ministry would promote domestic tourism to ensure Ugandans feel that the tourist attractions are part of our inheritance.

He said this would attract more foreign tourists and, hence, more foreign exchange receipts.

He was addressing the tourism sector second review conference at Hotel African in Kampala recently. The conference brought together stakeholders in the tourism sector, and aimed at drawing a strategy to enhance tourism contribution to GDP growth, employment and foreign exchange.

It also seeks to make Uganda a top tourism destination in the region.

Kamuntu revealed that the ministry would establish tourism clubs in schools to instill a sense of love towards wildlife tourism and heritage among the young generation.

He, however, noted that the country’s poor infrastructure was presently affecting the development of the sector.

Wasswa Balunywa, the principal of Makerere University Business School, said there was a need to repackage the sector if it is to compete favourably worldwide.

He cited poor work ethics and lack of confidence among Ugandans as major challenges failing the sector to compete favourably. Balunywa was presenting a paper titled Transforming Uganda’s tourism industry to compete on the world stage at the conference.

Meanwhile, Prof. Kamuntu has urged the Government to allocate funds to ministries depending on their contribution to country’s gross domestic product (GDP).

Kamuntu argued that this would ensure better returns to the development of each sector.

He wondered why the tourism sector, which contributes 9.2% to GDP gets only 0.14% of the national budget allocation.

“If the Government wants a better return, it should invest where that return comes from,” he said.



South African firm takes over Woolworths
Wednesday, 14th September, 2011
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By Samuel Sanya

Woolworths-South Africa has acquired a 51% majority stake in Woolworths-Uganda as part of wider measures to grow market share on continent.

Previously, Woolworths Tanzania owned the Ugandan operations. Ali Mufuruki, a Tanzanian businessman and former franchise partner said the firm would expand following the acquisition.

“The entry of the South African investors will increase business capital, enabling us to increase capacity and open more outlets,” he said.

Glenn Gilzean, the Woolworths-South Africa chief, was upbeat about investments in the two East African countries given the high growth prospects.

“Our confidence in these two East African countries and in our partner Ali Mufuruki has spurred an expansion of our retail presence. We expect further growth in the future and our ongoing retail expansion will create jobs and enhance local retail skills,” he explained.

The company boosts of a local presence in Botswana, Namibia, Lesotho, Swaziland, Mozambique, Mauritius, Uganda, Kenya, Nigeria, Ghana, Tanzania, Zambia and Angola.

It hit a $3.3b (sh9.2 trillion) profit last year.



Mabale Growers injects sh3b into expansion
Wednesday, 14th September, 2011
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Farmers checking green tea leaves after the stakeholders’ meeting last week
By Hope Mafaranga/b>

Mabale Growers Tea Factory has invested $1.2m (about sh3.3b) to expand, increase production and reduce operational costs. Kenneth Kyamulesire, the general manager, said the project would increase the factory’s production capacity from 70,000 kilogrammes of green leaf per day to 120,000 kilogrammes.

“The move will also improve the tea quality and price on the world market and bring down the overall cost of production,” Kyamulesire said.

He was on Friday speaking to tea farmers and stakeholders at the factory headquarters at Bugaki sub-county in Kyenjojo district.

The factory was established in 1969 by the Uganda Tea Growers Corporation. However, in 1994 it was transferred to small tea farmers of Kyenjojo and Kabarole districts.

Eulogia Rusoke, the board of governors chief, said the company had since 1994 grown from 220 members to 2,380 by 2010. He added that crop production grew from 3,800,000 kilogramnes of green leaf to 21,000,000 kilogrammes at the end of last year.

Rusoke, however, noted that the tea industry in the country faced problems, especially poor quality, due to the lack of a regulatory body and research to improve the modes of production.

“Research in the sector stopped in 1974 and whatever is being done in Uganda today is guess work.

“This has greatly affected tea quality, productivity, profitability and, therefore, we cannot predict the future of the industry,” Rusoke explained. He also said the factory was facing other challenges, especially the high cost of fertilisers. Today, fertilisers cost sh100,000 per bag compared to sh36,000 in 2006, he noted.

Okaasai Opolot, the director for crop production at agriculture ministry, said the ministry had established a research centre at Kyembogo in Kabarole district to find modern ways of tea production.

Opolot revealed that the tea industry was one of the sectors in the cash crops segment being targeted for funding.

“Tea is an enterprise we need to finance because it is the second biggest cash crop foreign exchange earner after coffee,” he said.

Opolot urged tea farmers to unite and form a forum to push Parliament to enact laws to govern the industry.


Govt to set up 10 silos
Wednesday, 14th September, 2011
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By Samuel Sanya and Roselynn Karatsi

The trade ministry will construct 10 silos in 10 selected districts around the country to ease grain post-harvest handling woes. Sixty satellite warehouses will also be constructed to feed into the silos.

The ministry has just completed the refurbishment of six warehouses, under the warehouse receipt system, in Jinja, Soroti, Gulu, Kasese and Mbarara with a capacity of 65,000 metric tonnes, said trade minister Amelia Kyambadde. The move is aimed at improving post-harvest handling, especially in the grain sector, she added.

Kyambadde was addressing the 5th National trade sector review at the Commonwealth Resort Munyonyo on Friday. The annual meet between ministry officials and the private sector was organised under the theme “Growing exports for robust economic development and transformation” as a precursor to this year’s round of Economic Partnership Agreements (EPAs) between the country and the European Union (EU).

The trade minister said the interventions were also aimed at growing exports to the region and Europe in order to strengthen the shilling through higher dollar inflows.

Kyambadde revealed that the 10 silos would be constructed in Gulu, Arua, Mbale, Soroti, Mityana, Hoima, Kyenjojo, Iganga, Kabale and Bushenyi districts. Milling and other value-addition machinery are also part of the project.

Meanwhile, Samuel Ssenkungu, a director in the trade ministry, said they were looking to improve the governance of co-operative societies by carrying out audits, investigations and arbitration.

“We are implementing the major recommendations made last year on strengthening commodity trading, formulation of sectoral policies and using co-operatives as vehicles for value-addition and institution development,” he pointed out.

In a related development, the Uganda Development Corporation (UDC), a government industrial research body, has been moved to the trade ministry from the finance ministry to hasten the industrialisation process.



Agribusiness gets sh63b support
Wednesday, 14th September, 2011
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By Mary Karugaba

THE United States Agency for International Development (USAID) has donated $22.5m (about sh63b) to help strengthen the Agribusiness Initiative (aBi) Trust in Uganda.

The US joins the existing partners; Denmark, Belgium, Germany, Sweden and the European Union in a long-term commitment to build a vibrant agri-business sector in the country.

The fund will be managed by the Royal Danish Embassy. Speaking at the signing ceremony, US ambassador Jerry Lanier, noted that the donor-to-donor agreement shows the US mission and the Royal Danish Embassy’s commitment to ensure aid effeciency in Uganda.

“This agreement proves that we are ready to uphold the pledges made by our governments under the Paris Declaration and Accra Agenda for Action to increase donor co-ordination,” he said.

The agreement would foster the development of agricultural production through the provision of financial and technical support to farmers and agribusinesses working with maize, coffee and beans.

“Because the private sector is the key driver for economic growth and poverty reduction, USAID’s contribution to the aBi Trust aims at improving food security, employment and exports,” a statement released by the Danish Embassy last week said.

Nathalia Feinberg, the Danish ambassador, noted the aBi Trust gives the Ugandan agri-business sector a new agent.

“This will generate long-term results that are not possible to achieve during the life of the traditional development projects,” she said.

The aBi Trust is a catalyst that supports the Ugandan agricultural sector and a conduit through which a number of development partners and investors can build the capacity of the sector.

It also seeks to increase income for over 100,000 farming families by 25%. It targets women farmers and entrepreneurs and young people.

It also aims to expand financial services in Uganda. Thirty-eight new rural bank branches are expected to be established through this support.

Over 35,000 new loans will be extended to small-and-medium agribusinesses, according to the statement. The trust was founded by Uganda and Denmark and is overseen by a Board of Trustees.

The aBi Trust is a major shift in thinking about how agricultural development can best be supported in Uganda.

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Uchumi plans South Sudan market entry
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By Monitor Reporter (email the author)
Posted Friday, September 16 2011 at 00:00
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Uchumi Supermarkets is eyeing entry into the South Sudan and new expansions in Uganda as part of the supermarket retailer’s expansion drive to boost growth.

Chief executive Jonathan Ciano said on Tuesday, that Uchumi would open a branch in Juba, which is likely to remain the newly independent State’s commercial capital “for at least a decade” even as plans are under way to relocate the administrative town to Ramciel.

“The change in capital will not affect our plans. If anything it may take ten years for the other city to catch up with Juba. The retailer also plans to expand to other locations or add to existing branches in towns where it already has a presence.

In Kampala, the regional supermarket giant expects to open new locations in the areas of Gulu, Kabalagala, Natete and Quality Mall in Kampala. It is also looking at expending into Kisumu, Ongata, Rongai, Kiisa, and Taj Mall in Embakasi, Kenya.

It will also make new inroads in Dar el Salam with a new branch at the Quality Mall. Uchumi is currently looking for business premises and does not have a firm date when it expects to have opened for business in South Sudan.

The supermarket chain is facing increased competition in most of East Africa’s saturated market from retailers such as, Tuskys and Nakumatt; that have since embarked on aggressive expansion.

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Sekabembe has turned her mother’s recipes into cash
Thursday, 15th September, 2011
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Brenda Sekabembe strikes a pose at her bakery
By Michael Kanaabi

Brenda Sekabembe grew up watching her mother bake cakes at home and always thought it was just another thing young girls learn to do.

It was not until she finished her university studies in 2003 that she realised she had a whole satisfying business career in her hands.

Starting out
“I went to my cousin’s office at Green Land Towers in search of a job and he told me to bake him a cake. When I delivered it, he paid me sh10,000.

His colleagues too liked it, so I left with three other prepaid orders. That is how my baking business started out” she said.

Armed with the three orders Sekabembe got a sh25,000 grant from her father to buy the ingredients and started her baking journey.

After two months, she got a job with Sausage King as a marketeer and reinvested all her earnings from this job in acquiring better baking equipment.

While working with a USAID project Sekabembe got an opportunity to travel to Australia on holiday.

She took some time off to do further training in baking and later went to Dubai to study how the cake baking business was done there. She also bought more equipment to improve her baking.

While all this was going on, her business was growing rapidly from referrals. She was soon faced with a blessing in disguise when she lost the USAID job.

In 2007, Sekabembe decided to pursue a master’s degree in public health in South Africa until mid-2008.

This set her back sh52m shillings but it was fully paid for by her cake baking business. While in Pretoria, Sekabembe never lost touch with her business and made 12 trips back home to ensure her clients were being served well.

She landed a job as a consultant with the Bill and Melinda Gates Foundation that she did till 2010 and continued doing some work for them by correspondence even after she returned from South Africa in 2009.

With the money she got from this rather highly paying job, Sekabembe invested in mechanising her business fully with the best machinery from as far as China.

This increased production and giving her and her staff more time to focus on the most technical part of the process, which is icing the cakes.

Achievements
From producing 5 cakes a week, she now bakes over 70 depending on demand. Her client base has grown to over 2,500 from a handful when she started out.

From revenue of sh6m in her first year, Brenda now rakes in about sh100m a year and employs eight people having started out alone.

On a personal level Sekabambe has built a house out of her baking, fully paid for her masters’ degree from the earnings of the business and bought herself a number of cars as well.

She has also supported a number of church activities and people’s education including relatives and an employee through to university.

Challenges
Inconsistence in power supply and the rising cost of electricity are a major challenge to Sekabambe’s business.

The business requires a lot of personal supervision to enforce standards while keeping you undergoing constant training to keep up with the latest trends in cake making.

“The increasing fuel prices are also affecting us since we do deliveries to our clients at no extra cost. The instability in sugar prices plus the rise of the dollar which we use to buy some of our imported ingredients have all pushed our costs up” she says.

Sekabembe plans to open an outlet in the city centre and later set up in other parts of Kampala as well.

She also plans to increase production to match the growing demand for her products and venture out into other cake varieties outside the event and party cakes she focuses on.

Her ultimate goal though is to get out of the day to day running of her business one day.

Biography
She was born in March 1979 in Kampala, went to Buganda Road Primary School for Primary, Gayaza High School for both O and A level then Makerere University where she graduated with a degree in Food Science and Technology in 2003.

She then pursued a masters’ in public health at the University of Pretoria from 2007 to mid-2008. She is now does her business full time.



We are not the problem - Umeme
Thursday, 15th September, 2011
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Buljan responding to questions during the interview

FELIX Osike and Chris Kiwawulo interviewed Luka Buljan, the consultant for Actis Capital, a subsidiary of UK’s Commonwealth Development Corporation which owns Umeme, about their operations and the 20-year contract with the Government. Below are the excerpts:

Question: You won the concession to distribute power for 20 years. It is now seven years down the road, what have you done?

Umeme has made a few drifts. It inherited a system that was in very bad shape. The network was dilapidated.

Poles had fallen down, sub-stations were overloaded and some transformers were bursting. The billing system was in a mess.

So what has changed?
We spent the first two years trying to ensure that nothing falls over. We also embarked on training people. After that, Umeme created a basis on which it could invest in the network.

It has so far replaced 100,000 poles out of a total of 240,000 poles countrywide. It has also replaced 2,000 transformers out of 6,000.

The big problem with transformers is that they are vandalised. We have 150-200 transformers being vandalised every year.

People steal the oil. We have refurbished 1500km of the network and built another 1500km. We have refurbished 40 out of the 60 sub-stations, and we built four new sub-stations.

We have put up a new billing system and infrastructure. There were 230,000 customers on the network when we took over, but by the end of this year, they will be 450,000.

This is the first investment at the distribution end of the power sector in Africa by your company. What challenges have you met?

Some of the problems we encounter are that the network is in bad shape. It needed a lot of work and investment and we are working on that.

The other big problem that we face is the supply not being enough. Our customers are unhappy and we understand their unhappiness.

But we want them to understand that Umeme just delivers the power, it does not produce it.

There was also drought. Several months following the start of the Umeme concession in March 2005 water flow through the Kiira and Nalubaale dams, which produced all the power for the grid was affected by a prolonged drought.

Output from the dams was curtailed from an average of 230Mw to 120Mw, at times even lower.

Severe load shedding ensued, which was only reduced with significant deployment of emergency thermal generation. Thermal power is very expensive.

How much has been paid to thermal plants?

The Uganda electricity sector will have spent $1.1b on buying power from thermal plants from 2006 to 2011.

This cost did not exist in the sector prior to 2006 and is the main reason for the significant increases in tariffs in 2006/7.

There were also foreign exchange movements. When the emergency thermal generation was introduced to Uganda, the exchange rate was sh1,700-sh1,800 to the US dollar.

Since then, the exchange rate has deteriorated to over sh2,500 to the dollar.

Because the electricity tariff is denominated in shillings and yet most of the costs are incurred in dollars, to recover the incurred costs, the tariff needed to be adjusted upwards.

The Electricity Regulatory Authority and the Government chose not to raise the tariff. So the amount of government subsidy had to be substantially increased.

How much is the total subsidy to date?

Total subsidy injected into the sector by the Government (excluding contributions from the World Bank) from 2006 to 2011 is more than $470m.

The delays in construction of the Bujagali dam also resulted in longer utilisation of thermal generation plants.

The dam was supposed to be completed in mid 2011, but it is now not likely to be fully commissioned before mid 2012.

This one-year delay is expected to cost approximately $285m in thermal power generation costs, of which $175m will have been contributed by the Ugandan Government.

The other problem is losses and theft of power. Losses were between 38% and 40% but they are at 28% now.

But some experts say the losses have remained at about 31.5%. If you had reduced them to 28%, wouldn’t power would be more affordable and reliable?

There is a double benefit. One is that when losses go down, there is more power to deliver to the customers and it has a positive impact on the rates.

But unfortunately, right now oil used in production of thermal power is very expensive. The shilling has been under pressure (depreciating). So, all those are pushing the tariff up.

How much has Umeme invested in the network?

Umeme has invested about $130m (sh364b) in the last seven years and that has substantially upgraded the network, although not the whole network because we have not yet got everywhere.

That should reflect itself in a better quality of supply.

But there is still load shedding?
Load shedding is something that Umeme is not responsible for because it only distributes power. It does not produce it.

There is high demand for electricity than the available supply. That is the main reason behind load shedding.

However, this is somewhat a product of Uganda’s success. It is a product of demand having grown.

Demand has grown because the economy has grown. The urban centres have grown. As a result, there is a mismatch between supply and demand.

If you have invested $130m, how much have you recouped?

We have recouped about $7m (about sh20b).

The tariffs have increased by 98% since 2005, is there any hope for a reduction?

The very important change is when Bujagali comes in, because Bujagali will replace a large portion of the oil-based generation.

The electricity price in Uganda will depend much less on the cost of petroleum. At full capacity with enough water, Bujagali will generate 250Mw, but initially it is going to be 50Mw and then they will add more turbines and it will come to 150Mw.

So, it will replace most of the thermal power, which is good because then the electricity price will no longer depend on the price of oil.

But unfortunately, Bujagali is a big project, which adds new costs to the (power) sector. So, I do not think there will be much change in the tariffs.

The concession is about to be reviewed, how much do you plan to invest in the network in the next seven years?

We are planning to invest $340m (about sh952b) or more in the next seven years.

At the end of this contract, assuming you have invested another $5m in the last year of the contract, how are you going to recoup this money?

The way the contract works is that Umeme invests into the network, and in the tariff, it gets a return on that investment.

But Umeme has been re-investing that money back into the network. When we get to the end of the concession, at that point Umeme and the Government could agree to extend the concession or the Government might say no we do not want to do that.

If that happens, then the Government will have to pay Umeme whatever it has not recouped.

When you look at most of the contract clauses, Umeme stands to benefit more than the Government, especially the termination clauses that require the Government to pay heavily in case any of the parties chooses to walk out of the deal. Why was it drafted that way?

This is a contract which was negotiated very carefully. The Government team was capable, smart and very transparent with very good advisers.

They had bankers and lawyers advising them and this is a contract which in the world is being seen as one of the very good examples of how a country can restructure its energy sector.

Why is the penalty in case the Government defaults on the contract stiffer (120%) than that of Umeme (80%)?

No no. The middle point is 100%. So, if it is Umeme’s fault, then Umeme gets 80%. If it is the Government’s fault, then Umeme gets 120%.

It means you get back exactly what you have put in. If it is Umeme’s fault, you get 20% less and if it is Government’s fault, you get 20% more.

But why would you get 20% more for what you have not invested?

It is because you have done nothing wrong (for your contract to be terminated). This is standard practice. This agreement is supposed to protect both sides. I think it is fair to both sides.

The penalty clause restricts us to stay with Umeme for 20 years even if it remains inefficient?

People are looking at Umeme’s performance unrealistically. I believe Umeme is performing to its targets. A lot of those problems that people associate with Umeme are because of the wider energy sector. The fact that there is load shedding, the tariff is high are not problems that Umeme can control.



Tourism soon to be revived in northern Uganda
Thursday, 15th September, 2011
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Acholi dancers doing the traditional dance. This is one of the potential tourist attractions in the northern region
By Gerald Tenywa

Following the end of the insurgency in northern Uganda, tourism activities are to be revived.

“The potential of tourism in this region is enormous,” says Edwin Muzahura, the spokesperson of the Uganda Tourism Board (UTB).

“We are preparing activities expected to rekindle the rich and diverse culture after 20 years of insurgency.”

UTB plans to harness cultural properties and historical sites including internally displaced peoples camps.

Other attractions being prepared for tourism operations are cultural and historical sites such as Fort Patiko, Wadelai, Aruu Falls in parts of northern Uganda.

Also trails have taking tourists to explore areas of historical significance such as Samuel Baker, Luo migrations into northern Uganda have been constructed.

Another trail will lead tourists to the birth place of 1972 Olympic Gold Medalist John Akibua (R.I.P) in Abako village, Lira district.

A brochure to be used as a promotional material for the sites and trails will be distributed locally and internationally. It will be distributed to embassies, Government departments, corporate entities and international entry points.

Muzahura was speaking ahead of the activities organised to commemorate the UN World Tourism Day on September 27.

Gulu will host the national celebrations under the theme, “Celebration of Tourism’s role in linking together the cultures of the world through travel.”

“The activities to celebrate World tourism day in Gulu is an opportunity to tell the world that the war is over and showcase what northern Uganda offers,” said Muzahura.

“It will also help to spread the benefits of tourism to northern Uganda.”

Queen Elizabeth National Park in western Uganda is the most visited national park yet Murchiosn Falls National Park is bigger and has a diversity of attractions, according to Muzahura.

UTB has teamed up with Mahali Africa Consult, a local firm based in Kampala and Purongo, Nwoya district to organise a weeklong activities starting September 23 in Gulu.

On September 23 and 24, the Gulu community will be mobilised to undertake a cleanup and marking of Zebra crossings.

The cultural and historical sites will be officially designated as tourism destinations.

A four day exhibition from September 24-27 will follow and national celebrities like Angela Katatumba, Jackie Chandiru and Kora Award nominee who is also a tourism ambassador Susan Kerunen are expected to perform.

The aim, according to UTB is to celebrate the revival of the lost art and cultural forms, traditional wear, dance, merchandise, folklore from west Nile, Luo, Karamojong to Nubian.

The celebrations will reach a climax with a band match past through Gulu and a corporate dinner at the new boma hotel where local artists will perform.

“Uganda is rich not only in biological diversity, but also in cultures,” said Amos Wekesa, the President of Uganda Tourism Association.

“Northern Uganda had been forgotten. With the return of peace to northern Uganda, it is now possible to go to any part of the country.”



Fake phone influx likely
Thursday, 15th September, 2011
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By Paul Busharizi

Tens of thousands of counterfeit phones could flood the Ugandan market in coming months putting retailers out of business and causing customer dissatisfaction, if moves by Kenyan communications authorities take off.

Last week Kenyan President Mwai Kibaki directed that all unregistered mobile numbers be switched off to prevent them being used to perpetrate crimes.

Kenya has been carrying out a registration exercise of sim cards over the last year.

It is estimated that up to three million users will be affected by this move. Kenya has 24 million mobile phone lines and the companies say that 80% of the users have registered.

But in addition Kenyan communications authorities are working with the telecom companies to disable counterfeit phones starting in October.

Traders in counterfeit, finding their market constricted in Kenya, will look to Uganda as the next logical port of call.

While the mobile service providers are not overly concerned by the new development mobile phone retailers are wary of the new development across our eastern border.

“As it is now counterfeit phones account for easily 50% of the market. It’s about price; people want cheap phones,” said Emmanuel Tayebwa manging director of mobile phone retailer Extel.

In reaction to Kenya’s move on the counterfeit phones he said, “This is a good development for the region and hope Uganda is going to take it up.

We have a huge challenge these phones in the market are really cheap. You remember the days when digital watches that were measured in kilogrammes? This is where phones are currently heading.”

And one should not be lured into a false sense of security that the counterfeits are of lower priced models only.

“You will be surprised there are already counterfeit blackberries, iphones and even ipads going for a fraction of the originals cost, less than 50% even.

So you think you are getting a bargain but before not too long the machine breaks down and even irreparable,” one retailer said.

The biggest impediment to widespread mobile usage remains the cost of a handset therefore lower cost phones would be a boon to the network companies, but they are wary of the fake phones.

“The average consumer on the street does not know the origin of the phones so from a perception point of view it could affect us in that they cannot differentiate our low cost phones – which meet our own exacting standards and the fakes floating around,” MTN’s Justin Ntabgoba-Kalema said.

She said the technology exists to barr Sims that are used in couterfeits but for it to be effective there has to be a regional initiative so that fake phones are not dumped in markets that cannot enforce the move.

Uganda too is in the midst of implementing sim card registration as is Tanzania and Rwanda.

Wherever the phone registration and such phone barring regulations have been instituted it has been for mainly security reasons and the expectation is that Uganda will go the way of Kenya too.



Ugandans to shun loans as rates hike
Thursday, 15th September, 2011
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By David Mugabe & Samuel Sanya

Commercial banks are predicting that fewer Ugandans are likely to borrow from them after they raised their lending rates.

This is because most Ugandans have fixed salaries that are rarely adjusted even with the rising cost of living. Higher lending rates will eat into their fixed incomes.

“Credit demand is expected to come down as the cost rises, and very few retail clients can increase their income/salaries,” says Charles Katongole, head of assets and liability management, Standard Chartered Bank.

For now, contrary to expectations, loans to households and individuals for private consumption climbed by 15% in July compared to 7.3% in June, according to information from the central bank.

Part of the explanation for this is that people have not changed their life styles.

But still instead of calming prices, Martin Muhwezi, a member of the investors club says the increases in the Central Bank Rate (CBR) will serve to increase prices beyond the current levels through expensive commercial bank credit in the short term.

“The cost of manufactured goods will just keep going up with increases in the cost of credit leading to higher inflation. Why? We have to borrow expensively, manufacture and transfer the cost to the consumer in the form of high commodity prices,” says Muhwezi.

Godfrey Ssali, a policy officer at the Uganda Manufacturers Association says that even when inflation is being caused by supply deficiencies, it is now harder to add a night shift to the usual day time work hours or to acquire extra land for production, purchase extra vehicles to increase the company fleet and purchase generators to boost production during electricity load shedding since credit is costly.

Most commercial banks have increased their prime lending rates at least once, with some have increased their rate twice in the last three months to match increases in the CBR.

The bench mark rate that is supposed to guide commercial bank lending rates has been on the rise, starting out from 13% in July, rising to 14% in August before hitting 16% in September.

The rise is expected to clamp down on inflation which has persisted, reaching 21.4% in August from 18.7% in July and stabilise the shilling by reducing consumer expenditures while promoting saving.

At the release of the latest CBR, Louis Kasekende the Bank of Uganda (BoU) deputy governor said the rediscount rate - the rate at which the Central Bank charges commercial banks for loans, has been set at 21% and 22% when borrowing against eligible collateral.

“The BoU is raising interest rates in order to curb the growth in bank credit, which has expanded rapidly over the last 12 months, to encourage higher levels of saving and to provide more support to the exchange rate,” he explained.

“If the inflation deteriorates in the next few months, the BoU will implement further increases in the CBR,” he added.

On September 9, Standard Chartered Bank raised its base lending rates from 20.5% to 23.5%.

The sharp rise from 20.5% to 23.5 compared to the previous 1% change according to Standard Chartered Bank is reflective of the changes in the current market environment, with the CBR up 200 bps and core inflation up to 20%

“Most significant was the upward increase in the Central Bank Reference Rate that was increased from 14% to 16% (in addition to the other changes regarding the policy rates) signaling a move to tighten liquidity over the month of September,” said Katongole.

But the corporate side and the retail side have since reacted differently to the changes with demand for credit especially from the corporate side remaining strong.

“These still have sufficient margin and can pass on the increased cost to their consumers,” said Katongole.
Going forward, bankers like Ajay Kumar, Crane Bank’s deputy managing director is optimistic about the current BoU interventions saying that the worst in the economy has passed.

“The rise in the CBR and rediscount rates affected our clientele but not very significantly. The entire CBR mechanism takes a while to take effect but I do not imagine the rate going beyond the current rate,” he said.

Standard Chartered views the medium term economic outlook as very attractive with oil production, emerging regional markets, the many large corporate are positioning themselves to take advantage of the situation.

Christine Alupo, the BoU assistant director communications told Business Vision that the Central Bank does not intend to out rightly dictate the rates that commercial banks charge by adjusting the CBR.

She, however, pointed out that banks are at liberty to adjust their interest rates according to their, individual, liquidity profile and credit market assessment.

Therefore the rate of choice can be higher or lower than the CBR for the month.

“The tighter monetary policy stance (increase of CBR to 16% from 14%) being pursued by the Bank of Uganda is expected to slow down credit growth.

“Inflation is expected to start falling by the end of 2011 and continue through 2012. Assuming no other external shocks, core inflation should fall to single digits and eventually to the target of 5% in mid-2013,” said Alupo. Core inflation was at 20% in August.

Also the Central Bank September monthly monetary policy report indicates that despite previous increases in the CBR, money in circulation has continued to rise, nearly reaching sh2, 000b in July from sh1, 800bn in June this year.

In line with expectations, private sector credit is showing signs of abetting, growing at a slower rate of 41.8% in July from 44.4% the previous month.

Lending to agriculture, manufacturing and trade grew by 29.8%, 33.1%, and 53.4% respectively from highs of 44.7%, 48.8% and 60.7% in June.

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Govt acquires ministry land to expand Entebbe
Monday, 19th September, 2011
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By Steven Candia

THE Government is to acquire part of the agriculture ministry’s land to expand the capacity of Entebbe International Airport.

Speaking at the launch of the new RwandAir Boeing 737– 800 on Saturday, state minister for transport Steven Chebrot said plans were underway to acquire the facility. RwandAir is the Rwanda national carrier, whose new aircraft made its maiden landing at Entebbe Airport on Saturday at 10:05am.

The acquisition of the facility, he said, was in line with the Government’s vision of increasing the capacity of the airport to handle many passengers.

“We are going to acquire the land to expand the airport so as to handle 10 million passengers per year,” Chebrot said during joint press conference at the airport. The press conference was also addressed by Rwanda’s ambassador to Uganda, Maj. Gen. Frank Mugambage and Alice Katiti, the RwandAir general commercial manager.

Asked when the acquisition would be effected, Chebrot said, soon.

The Ministry of Agriculture has a huge chunk of land in Entebbe, with the veterinary training institute close to the airport.

Chebrot said despite not having a national carrier, it is the Government’s plan to transform Entebbe International Airport into a major transport hub in the region.

Chebrot said the coming of the aircraft by Rwanda, moments after President Museveni’s visit there, signifies a warm relations between the two countries.

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Crown Beverages excite customers
Business
Written by Immaculate Wanyenze
Sunday, 18 September 2011 18:01

Aggie Konde

If you have seen Moses Golola, now a renowned boxer, out there boast that he can punch anyone who comes his way, then you get a picture of Mohammed Kiggundu, a boda boda rider at Kibuli stage.

See Kiggundu is all puffed up, always bragging to his friends that all the cars in the Mirindarific promotion are his. In last year’s Crown Beverage’s Motozela promotion, Kiggundu says, he drank close to three crates of Pepsi-Cola products but he didn’t win anything, not even a cap.

“I was so disappointed because I used my boss’ money to buy these sodas expecting to buy my own motorcycle, but up to now, I am still working for him,” Kiggundu says.

And this year, Kiggundu has already started sending his codes to 6777 from the 20 Mirindas he has so far consumed hoping to win a car.

Aggie Asiimwe Konde, head of marketing at Crown Beverages, promises not to let down such loyal customers. Different from the Chamuka Keys and Motozela promotions that were strictly for customers because of the few goodies; in this promo, everyone, including shop owners, will be a winner.

For the shop owners, kiosk owners and anyone planning to hold a party, it is simple. Konde says all one needs to do is buy a minimum of three crates of soda and they will be given a voucher whose number they will send to code 7111. For the consumers, the more sodas one takes and sends a code under the golden crown to 6777, the more chances they stand to win.

Goodies include a plasma TV, 36 Toyota Nadias, phones, motorcycles, bicycles, fridges, cookers and instant airtime worth Shs 800m across the different networks. Every week, 20 winners will be chosen because they either have the highest number of messages sent or are simply lucky. In order to show how credible the winners are for the weekly draws, the competition will be telecast live from Ndere Centre in Kisaasi.

Winners will be tasked to spin a wheel and where it stops is what they take. Konde believes that by continuously coming up with different promos, Crown Beverages give back to their customers who support a particular brand.

This year, Miranda is the leading brand that consumers have supported for the last five years, thus the Mirindarific promo. The promotion is the biggest ever, giving away prizes to over 1.3 million Ugandans.

It also comes at a time when Crown Beverages recently received the highest market award from the PepsiCo President.


Demand for new cars up despite poor economy
Business
Written by Milly Kibombo
Sunday, 18 September 2011 18:02

Part of Toyota Uganda showroom


Consumers shrugged off a declining economy, a government ban against its departments buying new cars and a depreciating shilling to keep the motor vehicle dealers happy.

Figures from the Uganda Motor Industry Association (UMIA), show that sales of new vehicles increased by 3% in the last eight months. An estimated 1,785 units were sold as of August, compared to 1,618 units sold in a similar period last year. The UMIA data also corresponds with that of Uganda Revenue Authority (URA).

The increase in sales was boosted by the high demand of pickups, trucks, tippers and station wagons, reflecting demand from non-governmental organizations and the booming construction sector. The data shows that 984 pickups were sold in this period, while 377 station wagons were bought compared to 227 saloon cars, mostly used by low income earners.

Only 17 tractors and 13 ploughs were bought, reflecting a poor investment in the agriculture sector. Toyota Uganda registered the highest sales with 718 vehicles, followed by Motorcare Uganda which sold 309 cars of the total sales. Skenya Motors sold only 34 vehicles, while Farm Engineering Industries and Kampala Motors Ltd sold none.

“We have been campaigning for individuals to buy new vehicles because it’s cheaper in the long run,” Tim Mwambire, sales director at The Cooper Motor Corporation, said.

He said preferential financing terms for new cars by banks was also playing a big part. Most lenders demand for a larger down payment for second-hand cars than new vehicles. According to Doreen Ampire of Asset & Vehicles department of Stanbic bank, the bank finances up to 80% of the cost of new cars while meeting only about 50% for old ones.

“Banks consider the risks involved. Old vehicles tend to break down more easily than new ones, making their leasehold a bit tricky,” Ampire said.

Banks such as dfcu have been financing up to 100% for new trucks and buses. Surprisingly, bus sales performed at a slow pace despite investors priming themselves into taking advantage of government’s plans to phase out the 14-seater vans used as public transport. Only 69 units of large and small buses with capacity of over 20 passengers were sold as of August.

Mwambire, however, said they are operating under tight economic conditions to remain relevant in the market.

“Most new vehicles are priced in dollars and this means that dealers have to review prices depending on the performance of the shilling,” he said

“New car dealership is not like buying clothes in shops. You make orders six months before delivery and by the time they arrive, the dollar has already changed.”

And despite the seemingly rosy situation, dealers like Cooper Motors are worried since most of their sales will be affected by a government ban on its deprtments buying new vehicles.

There’s also the issue of low supplies from Japan, a major source of second-hand cars. The country is recovering from a tsunami that struck in March causing huge destruction.

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Mulago Hospital for Shs203 billion refurbishment next year
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By FLAVIA LANYERO (email the author)
Posted Tuesday, September 20 2011 at 00:00
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Health banks on the completion of Kawempe and Makindye hospitals to relocate Mulago’s patients.

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Kampala

The refurbishment of Mulago National Referral Hospital that will see various equipment installed repaired or modern ones installed is set to begin late next year.

The hospital spokesperson, Mr Daniel Kimosho, yesterday said he could not commit himself to the date the construction will begin but said it will likely be next year. “It is generally the ambience of the hospital that we are looking at and re-equipping the hospital once renovation is complete to improve efficiency,” he said.

At least 6,000 people, who visit the hospital daily, are likely to be affected and relocated to Makindye and Kawempe hospitals, whose construction have not yet commenced.

Mr Kimosho, however, said with the $73m (Shs203b) already secured from the African Development Bank and the Nigerian Trust Fund, refurbishment should begin shortly. “It is our prayer that Makindye and Kawempe hospitals are completed by the time we embark on the Mulago project,” Mr Kimosho said.

The New Vision yesterday reported that the repairs are part of government reforms to improve health services in the country, in which all major hospital, including Masaka, Mubende, Kawolo, Mityana and Entebbe, will be renovated.

Meanwhile, Health Ministry Permanent Secretary Asuman Lukwago yesterday told this newspaper that the ministry is currently discussing pay rise modality for medics.

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Presidents to meet over regional trade
Monday, 19th September, 2011
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By Reuben Olita

Four heads of states from Burundi, Angola, Ethiopia and Kenya will attend the IGAD Investors conference in Nairobi slated for September 28-29.

Thirty-three regional ministers will also attend the conference seeking to raise $6b for eight projects in road, rail, ports, inland waterways and energy sectors.

Trade Mark East Africa Infrastructure advisor George Wolf said the conference will focus on four key corridors in the Eastern and Horn of Africa region.

The Northern Corridor that runs from Mombasa to Juba, through Uganda and the Central Corridor that starts from Dar es Salaam and ends in Kampala, are vital for Uganda.

The other corridors are Lamu, which will link the Kenyan Coastal Town with Addis Ababa in Ethiopia, through South Sudan. The Djibouti corridor will link Djibouti and Juba in South Sudan.

The objective of the conference is to provide support for implementing the communiqué made at the tripartite COMESA-EAC-SADC Heads of State meeting in Kampala in October 2008 to harmonise infrastructure plans across the three regions.

The conference will also secure donor, international financial institutions and private sector aid–for-trade to finance the removal of infrastructure constraints. These constraints hamper progress in realising more trade, higher economic growth and faster poverty reduction especially along the major corridors in the region.

The meeting will also endeavour to secure commitments from the members of the three regional organisations to address regulatory and administrative constraints blocking expansion of regional trade and economic growth.

During the First Summit in Kampala in October 2008, regional leaders underscored the need for developing infrastructure in order to speed up integration in the Eastern Africa region.

Kenya’s growth potential is being hampered by inadequate infrastructure, particularly transport infrastructure which has suffered from years of under
investment.

Uganda starts producing soy milk
Tuesday, 20th September, 2011
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Customers being served soy milk
BY DAVID SSEMPIJJA

Uganda’s food production industry has achieved a new milestone with the introduction of milk produced from soy seeds.

The milk is being produced by SESACO, a local firm that has been turning soy seeds into a multiplicity of consumable products.

According to the company managing director, Charles Nsubuga, the soy milk production technology was learnt through years of training at different soy development institutes and food producing companies in American.

“We have successfully been producing different products from soy seeds, but our latest breakthrough is the production of soy milk and meat, whose local market demand has been growing steadily,” Nsubuga said during the launch of company outlets at the new Mukwano and Equatorial shopping malls.

The two products deliver more nutritional value to the consumers than those contained in animal products, he added.

Coming in liquid and powdered forms, soy milk has attracted people allergic to animal milk.

It is enriched with nutritive chemicals necessary for prevention of cancer and heart and bone diseases.

Nsubuga said SESACO staff had been trained in value addition at the World Initiative for Soy in Human Health and at the University of Illinois inter-soy department.


National ICT backbone ready in October, says NITA chief
Tuesday, 20th September, 2011
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Saaka (centre) conducting MPs on the ICT parliamentary committee around the national ICT backbone centre at Statistics House in Kampala on Friday
By Raymond Baguma

THE National data transmission backbone infrastructure and e-government project will become operational in October, a top official has said.

Dr. James Saaka, the head of the National Information Technology Authority (NITA), told MPs on the parliamentary committee on ICT that the initiative would decrease government operational costs and increase Internet access in remote areas.

It will also check absenteeism in government departments and agencies, connect all districts to the Internet and provide low-cost bandwidth throughout the country.

“Our major duty is to run ICT services and to ensure that the backbone is operation next month,” Saaka told MPs during a field tour of the project sites in Kampala on Friday.

“The backbone will influence the decrease in Internet charges for government and increase efficiency in service delivery,” he added.

While testing the tele and video-conferencing equipment as an e-government component, Dr. Pat Samanya, the ICT ministry permanent secretary, told the legislators that the equipment would also reduce misuse of public resources.

“This project will help us know that one is at their desk or not,” Samanya noted as he explained to the MPs how the tele-conference facility works.

The first phase of the project, which included the laying of 168 kilometre of optic fibre cable, connecting Kampala, Mukono, Entebbe, Bombo and Jinja, was completed in June 2008. It covers 27 ministries.

Phase two of the project is in the completion stage with 1,369 kilometre of cable laid to connect Busia, Malaba, Tororo, Mbale, Kumi, Soroti, Lira, Gulu, Masindi, Nakasongola, Luweero, Kyenjojo, Kasese, Fort Portal, Bushenyi and Mbarara.

Despite the initial challenges, the MPs observed that the project was a good initiative by the Government in reducing burgeoning administrative costs.

“Once implemented, the facility should be installed in our committee rooms so that government officials do not have to come to Parliament. This will also save their travel time,” Paula Turyahikayo, the committee vice-chairperson, pointed out.

Turyahikayo advised government ministries to hook onto the national ICT backbone to cut on the cost of communication.

The project is being undertaken by Huawei Technologies, a Chinese firm.




Government to construct science park at Namanve
Tuesday, 20th September, 2011
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By Pascal Kwesiga

The Uganda National Council for Science and Technology is to build a science park to enhance scientific and technological innovations.

The council secretary, Dr. Peter Ndemere, recently said they had secured a 5-acre piece of land at Namanve in Mukono district where they will start building the facility next financial year.

He said the sh30b park will serve as a centre for developing scientific and technological innovations.

Ndemere explained that the facility will also have a training complex. Dr. Maxwell Otim-Onapa, the council deputy secretary, said they had drawn out a plan to guide the project, adding that it would be presented to Parliament for approval.

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New Vision is highest read paper - ABC
Wednesday, 21st September, 2011
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By Roselynn Karatsi

New Vision is the largest circulating newspaper in Uganda, the latest Audit Bureau of Circulation (ABC), figures have confirmed yet again.

ABC is a global organisation that tracks circulation figures of major registered newspapers. In the figures for April to June 2011, New Vision registered a daily circulation of 32,218 copies compared to 24,230 for the Daily Monitor newspaper.

Bukedde, a New Vision sister paper published in Luganda, cemented its position as the country’s second-highest newspaper with a circulation of 31,137.

“ABC figures give advertisers a chance to make realistic comparisons and informed decisions as to which newspaper they should advertise with,” Tony Glencross, the Vision Group chief commercial officer, said.

He added that advertisers are also able to know how well they maximise the investment, which can be achieved by looking at the investment in the newspaper.

“Based on a full colour page, an advertiser pays sh265,000 to New Vision to reach 1,000 readers every day compared to sh307,000 to the second leading English paper to reach the same number of readers. This is 16% more expensive to advertise with them and 84% more affordable to advertise in Bukedde.

“Theoretically, they need to look at the circulation figure, which is the ABC figure,” Glencross added.

He explained that by taking the cost of the investment and dividing it by the ABC circulation figure one is able to assess the level of maximisation. He emphasised that advertisers need to look out for companies that are members of the ABC organisation since some newspapers claim bigger figures to attract advertisers.

In Uganda, New Vision, Bukedde, Sunday Vision and Daily Monitor are members of the ABC.

“ABC figures are a decision-making tool for advertisers in terms of print media choice and selection,” Godfrey Mulengi, the group’s head of sales said.

These figures also help advertisers to manage their communication effectively as they are able to determine where they get the highest level of exposure he added.


Land commission on spot over Mbale land sale
Wednesday, 21st September, 2011
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The local government minister has ordered the Uganda Land Commission to cancel the allocation of the Mbale lorry park land to private individuals, saying it was illegal.

The move followed a petition by Mutwalibi Zandya, the Mbale mayor over the commission’s action. The Mbale council recently relocated market vendors to the park to pave way for the building of a multi-million shilling morden market.

“The commission disposed of the land as if the PPDA law never existed,” Adolf Mwesige wrote in a September 15 letter to the land commission.

The letter was copied to lands minister.

Mwesige said the allocation of the park to private individuals was contrary to Cabinet policy and in breach of the law.

Mbale Municipal Council has held the land in question under statutory lease since 1962.

Mutwalibi said the land was allocated to businessmen Latif Mafuko and Yusuf Magomu. Hussein Magome, Massa Musa and Alfred Magomu are also claiming ownership to the same land.

Mbale district chairman Bernard Mujasi, said the commission was stealing public property.



Students get skills
Wednesday, 21st September, 2011
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Students of St. Mary’s College Kisubi display some of the DVDs they produced under the Junior Achievement Entrepreneurship scheme at Kololo Secondary School on Friday.

The scheme is a business mentoring project for students.Over 300 students were trained in business skills, including how start businesses and manage them, under the Students’ Entrepreneurship programme .



Uganda earns sh11b from coffee exports
Wednesday, 21st September, 2011
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Uganda’s coffee export earnings in 11 months of the 2010/2011 (October to September) season rose 64.3% from the same period last year, boosted by good weather, the Uganda Coffee Development Authority said in a report on Monday.

Uganda, which primarily cultivates Robusta, is Africa’s leading exporter of the beans and their earnings are a key source of foreign exchange.

State-run UCDA said Uganda earned $400.3m (about sh11.1b) between October last year to August this year, up from $243m earned in the same period of the 2009/2010 coffee year.

The report said the surge in earnings was “ascribed to good weather and the rise in coffee prices on global market.”

About 309,300 60-kilogramme bags of coffee were shipped in August, bringing the total cumulative bean exports this season to 2.81 million bags, UCDA said.

“The improvement is more pronounced in Robusta, especially from the South and Southwest crop. This is attributed to the timely rainy season that salvaged the crop from the earlier severe drought,” said UCDA.

Southern and Southwestern Uganda regions account for 45% of the country’s total annual coffee production.

UCDA forecasts Uganda will export three million bags of coffee in the 2011/2012 coffee year which begins next month.

Over the course of next year, the report said, Uganda would complete distributing coffee wilt disease resistant varieties to farmers and experiment with new breeds that can withstand drought.

UCDA had earlier projected a 46% rise in export receipts.



Hoima power dam works end Nov.
Wednesday, 21st September, 2011
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By Robert Atuhairwe

THE construction of a nine-megawatt hydro-power dam on River Wambabya in Buseruka sub-county, Hoima district will be completed in November.

The $30m (about sh83.6b) project is part of the Government’s rural electrification programme. By Saturday last week, engineers were fixing turbines and rotators in the power house as other works on the power channel and penstock line were going on.

Rogay Kumar, the Hydromax Power Company project manager, said the river had already been channelled to the spillway, which is the final stage in the construction of the dam.

Construction works on the dam started in 2005. “The project is in advanced stages and we expect to hand it over to the Government in November,” Kumar said.

He explained that each of the three turbines will produce 3MW of electricity.

He, however, said the work was being affected by the current heavy rains and the lack of a bending machine that is used for folding plates and hard pipes.

Kumar added that the firm was forced to send the pipes to Kenya for bending because the required machine is not in Uganda.

Fred Kabagambe-Kaliisa, the energy ministry permanent secretary, while on a site tour said the completion of the dam would be a huge boost to the sector, noting that it would lower power charges and enhance the region’s development.

He pointed out that the people of Bunyoro would get stable power supply when the dam is completed. Kaliisa noted that construction of a power line to evacuate power from the dam onto the national grid at Kinubi sub-station in Hoima had also started.

However, he decried the rate at which forests in the catchment area of the power plant were being degraded.

“There shouldn’t be people occupying that place because they cut trees in the guise of cultivation, posing a great risk to the project. The RDC should intervene and evict these people to save this multi-billion investment,” he argued.

He said part of the power would be used in the oil exploration industry in the whole of Lake Albert region.

Another obstacle he cited was the water levels going low during dry seasons on the River. The project employs about 120 people of which most are locals, where they work as concrete finishers, truck drivers, builders and carpenters among others.

[u.g boy]

Rwanda, Uganda, DRC sign tourism pact
Friday, 23rd September, 2011
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Chimpanzees are some of Uganda’s tourist attraction. Chimpanzee Zakayo (right) kissing Ruth as his second wife Amina looks on at UWEC.
By Herbert Ssempogo

A treaty to guide the trans-border management of flora, fauna and other tourist attractions between Uganda, Rwanda and Democratic Republic of Congo is in the offing.

The three countries are currently involved in consultations regarding the implementation of the Greater Virunga Trans boundary Collaboration (GVTC).

When it is finalized, the respective Governments would jointly solve trans-boundary problems such as poaching and illegal hunting. Others are rebel activities within the protected areas, human-wildlife conflicts and wildlife diseases among others.

It would also pave way for joint activities such as monitoring and research, development of new tourism products, community conservation interventions and awareness creation activities.

Volcanoes National Park in Rwanda, Virunga National Park in the DRC, Mgahinga Gorilla, Bwindi Impenetrable, Queen Elizabeth, Semliki and Rwenzoril Mountains National Parks in Uganda are the areas, which the treaty could cover.

The main parties under the Greater Virunga Trans-boundary Collaboration are Uganda Wildlife Authority (UWA), Rwanda Development Board (RDB) and Institute of Congo for the Conservation of Nature (ICCN).

According to a Uganda Wildlife Authority statement, absence of the collaborative treaty has affected fundraising efforts for the activities of the Trans boundary Secretariat. It is in Kigali, Rwanda.

“Most donors are not comfortable with funding a partnership that has not been officially recognized by the respective governments,” the statement read in part. However, Uganda will soon hold a stakeholders meeting to be followed by a Cabinet Paper.

Rwanda, which is reportedly ready, awaits Uganda and DRC to complete their consultative processes.

“DRC on its part reported that that they had finalized consultations on the draft Treaty, and were awaiting cabinet approval of the Treaty,” it said.

In 2008 the Netherlands Embassy in Kigali provided funding worth 4 million euros to the Collaboration for a 4-year project in spite of the absence of a formal treaty. It is meant to cater for the community conservation component of the trans-boundary Strategic Plan.

The funding, which was solicited for together with support from International Gorilla Conservation Project (IGCP), focuses on exploring ways in which lives of people near protected areas could be improved.

UWA, RDB and ICCN pledged to contribute some funds towards trans boundary work by facilitating meetings held in their respective countries and supporting the Secretariat.


Electricity supply goes up
Thursday, 22nd September, 2011
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By Samuel Sanya

WATER discharged at the Eskom-run Nalubaale Hydro-power Station has been increased to 1,000 cubic metres, leading to increased power generation by 54 Megawatts.

This is expected to reduce the current load-shedding, stakeholders announced yesterday, “We have been waiting for this for weeks now so that we can receive more electricity to distribute.

The extra 54MW from Eskom translates into minimised daytime and decreased night time loadshedding,” said Charles Chapman, the UMEME boss.

The increased generation comes after the Ministry of Water and Environment allowed the generators to increase water discharge at the Jinja dam from 700 cubic metres after load shedding doubled.

“Today we carried out two hours of daytime loadshedding,” Chapman said.



Roko wins dfcu Bank contract
Thursday, 22nd September, 2011
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An artistic impression of the new dfcu complex
ROKO Construction has won the contract to build a new dfcu Bank headquarters in Kampala.

According to Sam Kibuuka, the dfcu Bank board chairman, works on the $10m (sh28b) project will start next month and be completed by 2013.

He said the complex, which will be located on Plot 26, Kyaddondo Road in Nakasero, would house all the head office departments.

It will also have a banking hall, an executive customers’ wing, a training centre, a private nursing area for mothers, an equipped fitness centre, a cocktail terrace, parking area and a cafeteria.

Mark Koehler, the ROKO commercial director, said the firm will ensure value-for-money and completed the project on time.

Koehler and Kibuuka signed the contract deal at dfcu Bank headquarters in Kampala on Tuesday.

Symbion, an architecture firm, designed the complex.



Mzee Musaazi is not about to retire his sewing machine
Thursday, 22nd September, 2011
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By Joshua Kato and Umar Nsubuga

AS one approaches 80 years, body aches and cloudy sight are expected. But 84-year-old Mzee Israel Musaazi is a different picture.

He casually and effortlessly pedals his sewing machine. The clatter of the machine seems to call out to passers-by to bring him their clothes for repair.

Irrespective of his advanced age, Mzee Musaazi can still look through the eye of a needle and put a thread through.

Simple beginnings
For six days a week, Monday to Saturday, for the last 58 years, Mzee Musaazi has sat here and pedaled away.

In 1951, before Uganda got independence and before more than half of the Ugandans today were born, a young Musaazi was looking for work to earn a living.

“I did not have so many options. I scavenged for a job, but when I failed to get any, I got a sewing machine from my brother and started using it,” he remembers.

He worked very hard at the machine. There were not so many people in the Seeta area, but those who were there gave him good business.

“They had all kinds of clothes and I never chased away anybody,” he says. In 1954 he had bought his own sewing machine.

“Buying my own machine was one of my best achievements and it still is today,” he remembers. Musaazi still keeps this memorable machine, although he has since bought several other machines.

With his own machine, business boomed. He saved money because he knew that was the best avenue for becoming rich.

“In 1958, I bought five acres of land in Seeta at sh350,” he remembers. When you see this figure, you might assume that land was cheap at the time.

However, according to Musaazi, it was a lot of money. “I was doing well, but it took me a whole four years to get sh350 to buy this land,” he says.

Work ethic does it
Musazi, a resident of Kiwanga in Mukono has got an elaborate work routine. He wakes up at 6:00am, goes to the garden up to 9:00am He grows matooke mostly.

He utilises one hour to walk a 3km distance up to Seeta town where he works. His ‘office’ is on his tenants’ verandas.

“Walking helps me keep fit. That is why I do it every day,’ he says.
Mzee Musazi says his courage, strict work ethics and faith in his work are the major forces that have enabled him move this far.

There are many tailors around this area, but most people take their clothes to Mzee Musaazi.

He says he enjoys every bit of his work, be it patching up a hole in a pair of trousers or shirt. He wears a smile as he works because he knows his work is what brings in the money. His feet pedal away and his hands pull in a way that only a seasoned tailor can co-ordinate the actions.

“He is a good person. He always listens to us and advises us on various issues. He has watched the growth of Seeta town, from a small village to what it is today,” says Sarah Mukasa, a resident.

Success litters his path
Success and the years of his sweat are ably portrayed on his five acre piece of land. He also has three plots of land in Mukono on top of the shops in Seeta.

Another of the residents, Michael Ssenoga says the Mzee is an interesting fellow.

“It is his knowledge and grasp of issues that baffles us. He can discuss any topic without scratching his head for answers,” he says.

Mzee Musaazi has seen and passed through all Uganda’s post-independence regimes.

Sitting along one of the major highways in this country has meant that he has seen and felt every happening in Uganda’s militalised history.

“Amin’s years were the worst. We only scavenged through,” he recalls. Whenever there was trouble, he and his family went into hiding, just like the rest of the population.

His best times have been the last 25 years since Museveni came to power, especially because of the prevailing peaceful environment.

“I do not think these have been good times for only me alone, but for many people. This is why Seeta is now a town,” he says.

On the five acres of land, he planted coffee to earn a side income. He has also since constructed several houses for rent, including commercial structures. The houses pay him well.

“This was a village,” he says as he looks around.

“I was among the very first people to settle here. I have seen it change to a town,” he beams. “Very few people of this generation will have such an honour,” he says.

He also advises youth to work hard. “Do not despise any job that comes your way. Realise that even if it is deemed to be a ‘bad’ job by the society, you can make it good,” he says.

“These are my last words and thanks go to all people who appreciate my work because if I did not serve for all these years people would not know me, but many have given me gifts.

I have even visited several places because of my good work. Many rich people in Mukono have taken me and my wife to eat with in expensive places. I appreciate that, God bless my customers,” he says.

“I respect my job because I have educated my children and I am happy that one my daughters took the same job I do” he says.

At 84, Mzee Musaazi is not considering retirement.



Cyber cafes struggle to survive mobile internet
Thursday, 22nd September, 2011
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By Michael Kanaabi and Samuel Sanya

JAMES Senkumba has been making a living out of his Mengo-based Internet café for over eight years.

But his days in the café business seem to be coming to a fast close as both client and revenue diminish.

“Gone are the days when I charged clients up to sh6,000 an hour and still had a full house all day with my 10 computers fully occupied” he says.

Business has been dwindling since 2009 when mobile Internet modems became cheap.

“Many of the customers who needed my services have moved on to the modems which are more convenient,” Senkumba says.

Senkumba points out that the arrival of the mobile Internet modems pushed most Internet cafés to operate at minimum profits with the really expensive café’s charging sh30 per minute and the other cafés charging as low as sh15 to sh20 per minute.

Bring on the low cost smart phones such as the Google Android and HTC mobile phones now going for as low as sh150,000 on the black market and sh200,000 in the shops and business is bound to get harder for the cafés.

Joseph Mutuza a café owner in Nankulabye says many people now access the Internet on their phones with the charges going as low as sh4 per minute for basic usage as opposed to going to the more expensive Internet cafés.

At the moment, cafés are charging much less than sh15 a minute, a cost which is still way too high considering the options.
Frank Birondwa, a systems analyst says the average smart mobile phone comes with extra abilities such as preloaded games, translation services and a host of several applications on top of Internet surfing that make the phones more useful than the café’s where one is restricted to surfing the Internet.
With the cost of rent and other utility bills skyrocketing day and night, it doesn’t seem to make business sense to continue running an Internet café alone.

That is why James Senkumba and other café owners have either diversified or are looking elsewhere.

Senkumba says he has decided to focus on what used to be extra services at his café in order to cope with the dwindling revenues from the Internet section.

“My printing and photocopying machines together with the limited stationary and simple computer accessories and hardware like CDs have become the new focus of my business as they bring in much more revenue,” he says.

Senkumba adds that with time, he might sell off some of the computers and focus on things like book binding, lamination and large format printing.

These bring in bigger business considering the growing number of higher institutions around Mengo and Rubaga.

On the other side though, Joseph Mutuza whose internet café is in Nankulabye, a city suburb, has discovered a new money minting venture.

He now provides play station and computer games on his computers which are a favourite among pre-teens in the area.

“For sh500 per game, I find that I am making more money since a game lasts about 10 minutes on average with a long line of kids waiting to have their turn unlike the Internet that only attracts a handful of clients a day,” Mutuza says.

He adds that he has taken on computer repair and duplicating of CDS plus DVDS to salvage his business and so far he seems to be making head way in that direction.

Mutuza says the future of Internet cafés is bleak as there are over four Internet cafés around his premises that have since closed.

One of them was turned into a photo studio, another was replaced by a restaurant while the other two were converted into retail shops a couple of years back.


SMEs need insurance even more
Thursday, 22nd September, 2011
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Traders trying to salvage their goods in the recent Owino fire. Insurance mitigates the impact of such incidents
By John Odyek

A stitch in time saves nine. But many micro businesses owned by our mothers, fathers, brothers in Uganda have not taken on insurance , the stitch that can save them from total loss in their businesses.

Micro businesses are businesses employing less than five people, privately owned by sole or groups of individuals and generate low annual revenues.

David Amos a trader owning a stall in Owino Market says he does not know much about insurance. He thinks he has to pay a lot of money for insurance premiums and they does not know what insurance can do for him.

Miriam Magezi, the chief executive officer Uganda Insurers Association responds that micro insurance applies to protect businesses, such as those operated by individuals in the markets such as Owino, Nakasero and other similar establishments against specific risks such as fire, theft, crop failure, education and risk of loan repayment.

“There is the loan protection cover or credit insurance. For this product, extensions may include group personal accident, illness and funeral expenses. Other traditional covers can include burglary”.

She discloses that in the case of the Owino fire the benefits the traders would have received if they were insured would include replacement of the burnt merchandise and repayment of the unpaid loan balances.

Magezi reveals that the new insurance environment seeks to see that insurance packages are affordable even by low income earners.

“Insurance premiums range from as low as 0.1% to 4% depending on the size of the risk and other underwriting considerations.

There are number of benefits, including peace of mind, business continuity, income protection, protection against unplanned for expenses as well as family”.

Magezi notes that there is the general lack of awareness and low financial literacy levels. She says there is a general perception that insurance is expensive and for the rich.

She adds the majority of Ugandans still earn low incomes, which means that there is competition on an individual’s needs list.

“That same income has to meet costs of food, health, clothing, education, social contributions thus services such as insurance, though a necessity, are given last priority”.

She says in Uganda social culture practises promote dependency on relatives and friends, in case any mishaps are suffered. She says the Uganda Insurers Association (UIA) is carrying out a country wide insurance sensitisation campaign on what insurance is and the key theme is that “insurance is affordable and insurance has benefits”.

She says members of the UIA have been educating insurers on micro-insurance. Insurance companies have begun setting up branches up country and UIA is establishing collaboration with banks and micro finance institutions.

According to the last industry performance report 2010 released by Uganda Insurance Commission, there has been a 19% growth in insurance premium and some of the factors that contributed to growth were a marked increase in micro insurance business as well as loans protection business.

Magezi explains that for small traders to get insured and ensure their families are protected against potential loss of income they need to identify the risks they are exposed to and wish to have covered; contact an insurance company one would wish to insure with.

They have to present an insurance proposal and establish how much premium is to be paid.

George Okotha, tjhe deputy commissioner Uganda Insurance Commission (UIC) says UIC has contributed to the recent amendment of the Insurance Act, the law regulating insurance in Uganda to accommodate micro insurance.

Okotha says UIC is now working on the regulations to operationalise it.

“Once this is finished, we shall have companies dealing in only micro-insurance and this will go a long way to increase the awareness of the benefits of micro-insurance to the low-income people as they will have to market the product,” Okotha asserts.

He adds that in case of complaints on any insurance player people can contact UIC and they can mediate on the disputes through the complaints bureau.

[u.g boy]

Qatar Airways to enter Uganda
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Qatar Airlways is focusing on Uganda as a growing destination with a lot of potential. AGENCIES PHOTO

By Walter Wafula (email the author)

Posted Monday, September 26 2011 at 00:00
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Doha-based airline Qatar Airways plans to launch flights to and from Entebbe International Airport in November this year, as part of its global expansion efforts. Mr Pritt Chibole, the commercial manager Qatar Airways in Uganda told Daily Monitor on Friday, that the airline will start daily flights to Entebbe from Doha and other destinations.

The launch of Qatar’s flights at Entebbe, will give Ugandan travellers another alternative airline to the Middle East, Europe and Asian destinations.

Ugandans currently fly to business destinations on the continents using Emirates, Kenya Airways, Turkish Airlines, British Airways and KLM-France.

The airline has expanded to Uganda because of its central location in East Africa and vibrant economy. “We have confidence in the Ugandan market that’s why we have decided to come here to operate daily,” Mr Chibole said in an interview.

Qatar Airways currently flies to Kenya and Tanzania in East Africa. But it also flies to South Africa, Seychelles, Nigeria, Sudan, and Egypt among other African states. Globally, the airline flies to 100 destinations in the world.

The entry of the airline is expected to tighten competition in the airline industry especially among the big boys like Emirates and Kenya Airways, making it more affordable to either travel or ship goods by air.
If commissioned, the airline will become the second to start services in Uganda after Turkish Airlines from Turkey, in the last 18 months.

Turkish businessmen toured Uganda this year to strengthen business ties with their counterparts in Uganda, as a result of its expansion in Uganda last year.



On Monday, Qatar launched expanded services to its European routes of Bulgaria strengthening its presence on the continent.
The airline is targeting to serve 120 destinations around the world by 2013.


Vision Group profits up 309 percent
Monday, 26th September, 2011
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The Auditor General Muwanga(left), Kabushenga and Orono Otweyo, a director, chat after the meeting
By David Mugabe

VISION Group’s 2010 year end profits have shot up by almost four-fold on the strength of what the chief executive officer described as investments in multimedia “starting to pay off.”

Profit after tax grew by 309% to sh3b in 2011, up from sh734m in 2010, while overall revenue rose to sh61.8b from sh49.9b.

“This year, we have been in a position to give the shareholders a decent return because the investments over the last three years are showing signs of making a return,” said Robert Kabushenga, the Group chief executive officer.

The Group’s directors have proposed a dividend of sh30 per ordinary share.

Overall, earnings per share rose by 290% while commercial printing and advertising registered the highest growth rates at 35% and 27% respectively.

While presenting the financial report to the Vision Group board, the Auditor General John Muwanga described the Group as “well managed and well organised.”

The Group’s accounts were audited by Deloitte & Touché on behalf of the Auditor General.

Kabushenga said the stellar performance was testimony to the high calibre of staff in the Group that has also made it one of the best local companies.
“We have the best team in the media business. This is the reason why every year we keep posting the best performance in the industry,” said Kabushenga.

Most of the Group’s stable of titles and media platform registered growth.

Electronic media grew by 88% with the bigger chunk from TV revenue hitting 272%. Print advertising grew by 12%.

But the rising cost of inputs especially printing materials pushed direct costs by 23%. Loss on investments also rose to sh34m from sh23m.

Kabushenga was, however, cautious that the global economic slowdown and the general hard economic conditions will pose a challenge next year because it was affecting the purchasing power of everybody particularly advertisers.
“Nevertheless, I am confident that we shall remain profitable,” said Kabushenga.

The board has also announced the company’s annual general meeting for November 17 at the New Vision head office in Industrial Area Kampala.


Vision moves to fill Uganda's digital space
Monday, 26th September, 2011
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By Stephen Ssenkaaba and Conan Businge

New Vision and Bukedde will have new state-of the art websites beginning October 3 this year. The redesign of the two sites marks the completion of the first phase of a year-long plan to digitize Vision Group operations.

Louis Jadwong, Vision Group’s Head of Digital said the redesign is part of the company’s sustained strategy to provide innovative and better services to the public.

"We are finally implementing what has been on the drawing board for nearly five years. The automation of all our operations was long overdue, and I am positive we will get an increase in productivity and
finally be able to gauge and monitor performance better," he said.

The new websites will have a new navigation structure and their capabilities will be enhanced to better serve their respective audiences locally and in the Diaspora. The sites will also have versions for all mobile devices.

The website www.newvision.co.ug will also evolve into a key port for breaking news on Uganda.

One key addition of the redesigned digitial platform will be the E-paper, a replica of The New Vision newspaper that will be available on subscription, while clips from the popular Bukedde TV and Urban will be available online free of charge. The site will also have a rich archive for researchers, with digital copies of the newspaper from the year 2006.

Content on the new sites will remain largely free but the newspaper, the archives and the e-paper will be accessed through registration and subscription. The subscription rates and payment methods will be announced in the Business Vision pull-out on Thursday, September 29.

Paul Ikanza, the Head of IT at Vision Group, said the investment in new software will help set new trends online.

“I believe the new design will not only make for more convenient reading, it will also provide the news a lot more easily and instantly,” he remarked.

”From an infrastructure point of view, we have used the latest available technology to ensure redundancy and availability.

That is, we have implemented 100% virtualisation of all the systems.
What this means is that they are hardware independent and minimally susceptible to extended downtime. We are also able to provision services very promptly when there is need for expansion.”

He added: “We, for example haven't had a mobile site and have only just recently integrated facebook and twitter updates but still, these are not being optimally used.”

Uganda’s leading website www.newvision.co.ug has 21,000 fans, up from 1,000 in November last year while bukedde.co.ug has grown to 1,600 fans in the last few months.

Former head of website and now Vision Group’s Business Editor Sam Apedel looked forward to greater days for the New Vision and Bukedde online.

“In the pioneering days, the digital department simply concentrated on giving an online presence to our print products. As such, our flagship website www.newvision.co.ug was simply an online version of our newspaper.”

“As digital technology improved the website visitors became more sophisticated, a new product became a necessity.”

Vision Group partnered in April on this project with Indian IT Company, Four C Plus, whose team has now started installing the software. They will start with the online overhaul, followed by installation of the editorial and advertising systems. Finally, all systems will be integrated with the HR, Printing and circulation systems.

[u.g boy]

Vision to launch new websites
Monday, 26th September, 2011
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Louis Jadwong
By Conan Businge and Stephen Ssenkaaba

NEW Vision and Bukedde are to have modern websites beginning October 3. The redesign of the two websites is the first product of a year-long plan to digitalise Vision Group operations.

Louis Jadwong, Vision Group’s head of digital, said the redesign was part of the company’s strategy to provide better services to the public.

“We are finally implementing what has been on the drawing board for nearly five years. The automation of all our operations was long overdue. I am positive we will get increase productivity and finally monitor performance better,” he said.

Jadwong said both websites would have a new feel and their capabilities had been enhanced to serve audiences, locally and in the diaspora. The sites will also have mobile phone versions.

Jadwong added that Uganda’s leading website, www.newvision.co.ug, would evolve into the country’s key port for breaking news on Uganda.

“The website will move away from being just a digital copy of the newspaper, to catering for the audience mainly by the E-paper,” he explained.

The special addition to the new websites is the E-paper, a replica of the New Vision newspaper.

It will be available on subscription, while clips from the popular Bukedde TV and Urban TV will be available online free of charge.

“The site will also continue to have a rich archive for researchers with digital copies of the newspaper from 2006,” Jadwong explained.

The content on the new sites will remain largely free, with access to the newspaper online, archives and E-paper done through registration and subscription.

The subscription rates and payment methods will be announced in the Business Vision pull-out on Thursday.

Paul Ikanza, the head of the Vision Group’s IT section, said the new sites would provide much needed convenience for the company’s audience.

“The new design will not only make reading convenient, but also provide the news a lot more easily and instantly,” Ikanza explained.

He said the new system would provide more sustainable products.

“We have used the latest available technology and have implemented 100% virtualisation of all the systems. This means that the hardware is independent, and minimally susceptible to extended downtime,” Ikanza added.

Susan Nsibirwa, Vision Group’s head of marketing, said the new design was part of the company’s commitment to be a market leader.

“We set out to achieve excellent global standards in whatever we do at Vision Group. This website puts us at par with leading global players in the media industry,” Nsibirwa said.

Sam Apedel, the former head of Vision Group’s websites, said the new websites would provide richer content and further spur Vision Group to greater heights in the media industry.

“The new websites will provide content beyond the newspaper. It will provide more interactivity, reader choices, user-generated content, breaking news and continuous reporting,” he said.

This, Apedel added, would be provided in a multimedia with sound, sight and motion through video and audio streaming.

Bukedde’s editor Andrew Kaggwa said the new website would be extraordinary and unique.

Apart from having short videos and audio news clips, the website will carry clips of the ‘Agataliko Nfuufu’ news bulletins from Bukedde TV.

“We plan to use several pictures of our uploaded news on the website,” Kaggwa explained.

This is the first redesign of the website since it was launched in 1999.

It has grown into the country’s most visited site by Ugandans here and abroad after Facebook, Google and Yahoo. New Vision had 20,800 fans by last week.

According to August figures of Google analysts, the site had 1.5 million visits (48,000 daily), 5.6m page views and 397,000 unique visitors last month.

Leading Vision Group writers Paul Busharizi (economics, business), Charles Wendo (health), David Mukholi (politics), Kalungi Kabuye (entertainment) and Joseph Batte (music) will give regular insights online.

Vision Group is working with a leading Indian IT solutions company, Four C Plus (Internet) Company Limited.

The online launch will be followed by the digitalisation of editorial operations in all newsrooms including newspaper, radio, television and regional offices.

This will be followed by advertising and the circulation systems.


Works minister seeks sh50b for bridges
Monday, 26th September, 2011
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Byandala (left) Butaleja district boss Joseph Muyonjo (centre) and deputy CAO James Wanje
BY PAUL WATALA

Works and transport minister Abraham Byandala is considering tabling a supplementary budget request before Parliament seeking sh50b for emergency repair of roads and bridges that were recently damaged by rains countrywide.

“We need more funds for emergency repair of foot bridges and feeder roads. The challenge is that the ministry has no money to work on all these bridges and roads at once and only a supplementary budget can save us,” Byandala said.

Byandala said he would table the request before the Cabinet for discussion.

He was touring Bulambuli district last week. He also visited the scene where over 26 people were buried by landslides and appealed to the residents to accept relocation.

“The Government has no intention of grabbing your land,” he said.

Byandala added that children were seated at homes because they could not access their schools while farmers had abandoned their gardens because of broken foot bridges.

“The Government is going to buy culverts and work will begin soon,” he said.

He said Bulambuli alone needed about sh2b for immediate repairs, adding that some equipment had been secured and the district would be among the first to receive the emergency assistance.

“We have secured more than 100 earthmovers from China. The district chairperson should, therefore, contact the Minister of Local Government for consideration,” Byandala said.


Kibaale gets school for needy
Sunday, 25th September, 2011
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Bataringaya (L) interacts with other guests after commissioning a block at the school recently
By ISMAEL KASOOHA

A multi-million shilling secondary school to help needy children access education has been constructed in Kibaale district by the Tijhaar Education Foundation, based in Netherlands.

Speaking at a ceremony to commission a classroom block at the school in Nkondo village on Monday, the state minister for primary education, Kamanda Bataringaya, said the Government had prioritised human resource training as a pillar to development.

“The vision of the NRM government is to develop human resource as a catalyst to development,” Bataringaya said.
He asked the management to ensure that the school is registered with the Ministry of Education and Sports.

The chairperson of the Tijhaar Education Foundation, Wim Tijhaar, asked parents to appreciate education as a lifelong investment.

Tijhaar gave sh70m to the school to facilitate development initiatives.
The idea to set-up a school in the area was initiated by Uganda Rural Development and Training Progrmme.


Nyakibale Hospital gets nurses school
Monday, 26th September, 2011
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Rolland Kaginda, Alban Kiconco and Dr. Ronald Kasyaba at Nyakibale on Friday
By Caleb Bahikaho

The Danish and Ugandan governments have constructed a sh3b nursing school at Nyakibale Hospital in Rukungiri district.

The hospital superintendent, Dr. Ronald Kasyaba, said the construction had been completed and the structure was awaiting hand-over in November this year.

He said the project was aimed at equipping the hospital with an enrolled comprehensive nursing school.

Nyakibale is a private hospital founded by the Catholic Church.

Dr. Kasyaba, while taking the Rukungiri municipality MP, Roland Muguma Kaginda, around the structure on Friday, said they had constructed six executive classrooms, a dormitory and kitchen. He said the school would accommodate over 500 students, up from the current 165 students.

He said the school offers general nursing, enrolled comprehensive nursing and enrolled midwifery.

Kaginda thanked the Danish government for extending support to the hospital and promised to link Nyakibale Hospital to international NGOs for more support on equipment.


Ndejje gets sh12b lab
Monday, 26th September, 2011
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The chairman of the university council, the Right Rev. Bishop Evans Kisekka (right), Bishop Wilson Mutebi and the Mityana diocese bishop, Dr. Steven Kazimba, after touring the Ndejje complex on Wednesday
BY EDDIE SSEJJOBA

Ndejje University has set up an engineering and computer technology laboratory worth sh12b. Located at the main campus in Luwero district, the six-storey complex comprises sh3b high technology teaching equipment.

It was set up to boost the teaching of chemical, electrical and computer engineering and other science-based courses.

The laboratory was commissioned on Wednesday by the vice-chancellor, who is also the retired bishop of Mukono Diocese, Dr. Michael Ssenyimba.

He said the university used loans from Equity Bank and dfcu Bank to set up the complex and purchase the equipment.

Ssenyimba explained that the university was determined to invest in subjects vital to the country, but rarely offered in tertiary institutions.

He lamented that the university had offered partial scholarships to 15 students to study chemical engineering, but only six took up the course.

Ssenyimba assured parents that the university would continue to teach arts, but put emphasis on sciences because it was in line with the government policy of encouraging the teaching of sciences.

The assistant executive secretary of the National Council for Higher Education, Jenny Birungi, lauded the university for venturing into sciences.

Museveni appoints new KCCA directors
Monday, 26th September, 2011
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George Agaba
BY JULIET WAISWA AND FLORENCE NAKAAYI

President Yoweri Museveni has appointed eight new directors to head different departments of the Kampala Capital City Authority (KCCA).

The directors will help KCCA executive director Jennifer Musisi to run the authority. Their appointments took effect last Tuesday.

The officials were Jennifer Busulwa Kaggwa to head the administration and human resources department, Mike Okua as director of legal affairs and Moses Nambale Bwire as internal audit director.

Others were Daniel Kyambadde as director of treasury services, Phoebe Lutaaya Kamya as director of revenue collection and George Agaba Ninsiima as director of physical planning.

Eng. Andrew Kitaka Mubiru was appointed director for engineering and technical services and Harriet Mudondo as director for gender, community services and production.

Busulwa worked with Centenary Bank as a human resource management consultant, while Okua has been a practicing city lawyer.

Kamya was formerly working with the Uganda Revenue Authority as assistant commissioner for arrears and objection management, and also served as assistant commissioner of customs.

Apart from Agaba who served in the defunct Kampala City Council as deputy director of physical planning, the rest of the directors are new in the institution.

Before the new appointment, Mudondo served as project coordinator and executive director of Development Initiative International, a local non-governmental organisation which promotes HIV/AIDS mitigation among Kampala market vendors.

However, appointments for the directorate of public health and environment and that of education and social services are still pending.

According to the KCCA Act 2010, the President has the mandate to appoint the city executive director together with a team of other directors. The law took effect in March.


KCCA issues guidelines for city kiosks
Monday, 26th September, 2011
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The Minister of the Presidency, Kabakumba Masiko (left), with The Aids Support Organisation (TASO) boss, Robert Ochai (second-leftw), after commissioning the new TASO offices in Kamwokya, a city suburb, on Friday
BY VISION REPORTERS

Kampala Capital City Authority (KCCA) has issued guidelines to regulate the operation of kiosks within the city and its suburbs. News vendors, telecom products, watch repairers, stamp makers and shoe shiners will be the only ones allowed to operate kiosks in the city centre.

The disclosure was made in a statement issued by KCCA executive director Jennifer Musisi on Thursday. Following the eviction of street vendors, newspaper bosses asked Musisi to provide their vendors space where they can operate.

The operators would, however, have to seek permission and pay fees in order to locate kiosks in areas gazetted by KCCA’s physical planning directorate.

“Permits shall be issued on temporary terms and renewal will be made annually,” Musisi stated.

KCCA will determine the suitable streets, open space and reserves on which an appropriate number of kiosks would be placed.

She said areas including Parliamentary Avenue, Apollo Kaggwa Road, Nile Avenue, Ternan Avenue and Kampala Road (Entebbe Road junction to Shell Capital) will be permanently restricted to kiosks.

The guidelines also recommend the size and material in which the kiosks would be made of. All kiosks in the central division are expected to be made out of fibre glass or quality material such as aluminum.

Those in the city suburbs may be made of fibre glass, metal or wood.

[u.g boy]

Oct 3: Big opportunities for Vision online advertisers
Thursday, 29th September, 2011
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Vision Group's Sales guru Mulengi
By Stephen Ssenkaaba
and Conan Busingye

The redesigned New Vision and Bukedde websites will revolutionise the online media advertising terrain, a top official said yesterday.

“It is going to change the whole game of online in this country,” Godfrey Mulengi, the Vision Group head of sales, said.

The two sites, one is Uganda’s leading source of news, and the other, the world’s leading Luganda website, have been rebuilt and will be relaunched on Monday.

Mulengi said true to the Vision Group advertising strategy, the new website will be an addition to the already existing basket of audiences which comprises unique and a varied mix of people.

“It is going to provide advertisers fresh, flashy and highly imaginative opportunities to communicate.”
The new sites will thrive on a powerful online presence which will seek to turn pages into advertising opportunities and will be supported by a dynamic and cost-effective pricing structure which brings the benefits and value of both online and offline media.

All this is intended to make life a lot more convenient for the advertiser.
“The advertiser will for instance gain double advantage and exposure because an advert will appear on the hardcopy, newspaper and e-paper to those who will have subscribed to it,” Mulengi said.

This will in the end assure great return on investment for the company, enhancing innovations and creativity levels and, an opportunity to target the new media opportunities as is happening all over the world.

The redesigned websites, Mulengi said, will offer the greatest and most effective opportunity for whoever intends to communicate, influence and engage audiences.

“Specifically, we are going to have more and new banner positions, including redesigning the former skyscrapper position into leader boards as well as more exciting features like screening banner and wall paper banner,” he pointed out.

He explained that the sites will also offer other online products for advertisers like scroll footers, page billboards, product and photo galleries, online only supplements, online classifieds as well as archiving content and services.

James Semwanga, the Group web administrator, said the new websites will have a global audience that anyone with an online presence wouldn’t want to miss.

“We reach out to an average of 40,000 people daily. These are visitors who use our online platform for its variety and rich content.

“Any business or organisation that wants to do online business beyond Ugandan borders should look out for our websites,” Semwanga observed.

Access to the paper online, archives and e-paper will be done through subscription using ATM cards (credit/debit cards), or through New Vision’s mobile money accounts whose details will be available on the new site www.newvision.co.ug from Monday.

First to be implemented will be credit card payments for the e-Paper, after which micro-payments per article will be implemented.
For payments via mobile, first to be implemented will be Mobile Money (MTN), as utl and Airtel are configured.

This if the first redesign of www.newvision.co.ug since it was launched in 1999 – then Uganda’s first newspaper site.
It has grown into the country’s most visited site by Ugandans here and abroad after Facebook, Google and Yahoo. New Vision site www.newvision.co.ug has a Ugandan record 21,000 Facebook fans – up from 1,000 last November.

Leading Vision Group writers Paul Busharizi (economics and business), Charles Wendo (health), David Mukholi (politics), Kalungi Kabuye (entertainment), Andrew Ndaula (farming) and Joseph Batte (music) will regularly give insights online.

Eden Kironde and Charles Mutebi will step in for sports insights.
Vision Group is working with a leading Indian IT solutions company, Four C Plus (Internet) Company Limited.

The online launch will be followed by the digitilisation of the editorial operations in all newsrooms – newspaper, radio, TV and regional offices, then advertising operations and integration with the circulation systems.

RELATED STORY
Vision Group moves to fill Digital space

FACTS
-An average of 40,000 people visit New Vision website daily.

-The portal has variety and rich content.

-More and new banners will be displayed.

-Offers a great return to investment.

-New in the online advertising in the country.
-
Advertisers will gain double advantage and exposure on hardcopy, newspaper and e-paper


Moroto bridge to re-open
Wednesday, 28th September, 2011
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Lorengedwat Bridge near completion. The bridge was washed away by rains
BY PAUL WATALA

Lorengedwat Bridge which connects Moroto and Nakapiripit districts will be re-opened to traffic in two weeks. The bridge was recently washed away by flood waters, cutting off six districts in the region from the rest of the country. The incident paralysed transport and business in the area.

The districts include Nakapiripit, Moroto, Namalu, Kotido, Kabongo and Napak. “Transport has been affected in the region because of this bridge. People were forced to use longer routes and pay more money to access other districts,” the Uganda National Road Authority maintenance engineer for Karamoja region, Hassan Ssentamu, said.

Reconstruction works on the bridge started two weeks ago. Ssentamu told the Minister for Works and Transport, Abraham Byandaala, who was on a five- day tour in the Karamoja region that over 10 bridges were cut-off but Lorengedwat bridge needed urgent replacement.

“We were forced to put a temporaly bridge so that traffic can access other districts for business,” Ssentamu added. He said several vehicles were swept away by fast running water, while others got stuck in the middle of the river as they tried to drive through.


Growing competition forces supermarkets into suburbs
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By Nicholas Kalungi (email the author)
Posted Wednesday, September 28 2011 at 13:14
IN SUMMARY

With over 10 supermarkets operating in Kampala, there is need to seek for alternatives.

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KAMPALA

As Kampala becomes more crowded, supermarkets have moved into the capital city’s suburbs seeking to ease shopping and accessibility. Leading supermarkets have embarked on an expansionist growth strategy by opening up outlets in different city suburbs and upcountry locations.

The move gives customers in different areas, a better possibility of enjoying cheaper prices for a variety of goods offered by supermarkets such as Nakumatt, Uchumi, Shoprite, Quality and Tuskys among others.

Mr Jeff Uchanga, the Uchumi country manager, told Daily Monitor yesterday, that the opening up of branches outside the Kampala Central Business District seeks to de-congest the city.

Many Ugandans have to move to Kampala to shop from areas including Uchumi at Garden City, Nakumatt at Oasis Mall, Game in Lugogo, Shoprite at Clock Tower and such other areas

Mr Uchanga said: “We are opening up branches in various locations as part of our wider plan to reach customers.”However, analysts say, the move has been precipitated by growing competition in the supermarket sector and the need to grow Kampala beyond its previous boundaries.

They argue that Uganda’s business space has grown reasonably beyond Kampala, thus there is need to establish satellite cities in Kampala’s suburbs. Mr Charles Ocici, the Enterprise Uganda Executive director, told Daily Monitor yesterday: “These supermarkets are dealing in ordinary solution commodities, which mean that they need to set up location in places that are accessed by the common man.”



Recently, Ms Kabakumba Masiko was quoted saying that the government had a wider plan to shift city markets to areas where they are most needed. Mr Bernard Mutua, the Nakumatt Uganda country manager, recently told Daily Monitor that through opening up branches in various locations of the country, they would reach their customers in areas away from the city centre.

He said: “We are looking at providing our customers with more alternatives and accessibility,” adding that “those who find it hard to reach the Nakumatt Oasis Mall, can still get our services from nearby towns.”

10 years ago, Shoprite opened shop in Uganda and was later joined by Uchumi and the Game Store. However, many businessmen have established large local supermarkets providing tough competition to mostly well established Kenyan and South African supermarkets.

[u.g boy]

Amama Mbabazi woos Arab investors
Friday, 30th September, 2011
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Mbabazi after being received by Mary Karooro Okurut (Right) the Information minister at Entebbe International Airport
By PASCAL KWESIGA

THE government has invited investors from the United Arab Emirates (UAE) to exploit the existing investment opportunities in areas of agro-processing, power generation and infrastructure.

The Prime Minister, Amama Mbabazi, said yesterday he held discussions with various investors during his three-day trip to the south-eastern country in the Arab peninsula.

Mbabazi disclosed that the Arab investors had expressed interest in investing in Uganda.

He told journalists upon his arrival at Entebbe International Airport that the two countries promised to set up two committees to agree on the terms and conditions.

The Prime Minister, who held discussions with the ruler of Dubai His Highness Sheikh Mohammed bin Rashid Al Maktoum, said various investors were interested in the existing investment opportunities in Uganda.

Mbabazi explained that several members of the business community in the country (United Arab Emirates) lacked information about Uganda.

He emphasised the need to market the country to attract foreign investors.

He said UAE is in the final stages of opening up an embassy in Kampala few months after Uganda set up its embassy in the country. Mbabazi said the development would spearhead investment and a good working relationship between the two countries.

He said there was a big market for meat in UAE that Uganda can exploit.

Mbabazi added that there were enormous lessons for Uganda to learn from the country that had developed through increased investment in human resource.
The Prime Minister observed that investment in power generation would enable Uganda achieve its target of producing about 4,000 megawatts of power by 2015.

He promised to look into President Museveni’s directive to ban politicians from trading in sugar now that he had returned.

Museveni issued the directive while on his private visit to India and instructed his vice and the Prime Minister to enforce the ban.


Inflation to drop 5% in 2013 - Central Bank
Friday, 30th September, 2011
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HEADLINE inflation increased to 21.4% in August from 18.7% in July, the highest level in 18 years. Paul Busharizi and Samuel Sanya spoke to Dr. Louis Kasekende, the deputy governor about the current economic health of country.

QUESTION: What are the main causes of the current high inflation rates?
The biggest cause is the higher food prices that have been brought about by supply shocks to harvests in Uganda and elsewhere in East Africa, and by higher global food prices.

Uganda’s annual food price inflation was 42.9% in August, whereas the Food and Agriculture Organisation’s world food price index rose by 26% in August.

There is also the danger of imported inflation and the depreciation of the exchange rate.
The shilling has depreciated by nearly 24%.
This has pushed up prices of imported goods.
The consumer price index food component has gone up by 40%.

What is the Bank of Uganda doing to reduce inflation?
We have tightened liquidity to reduce aggregate demand because it outweighs supply.
We use monetary policy for macro-economic management and to control inflation.

It is an effective tool to control inflation in the medium-term because it is related to aggregate demand.

However, it is not possible to control inflation in the short-term, when it has been caused by a supply side shocks.
A monetary policy cannot affect the supply of food to markets.

However, supply side shocks are cyclical, temporary phenomena and it is reasonable to expect harvests to improve and food prices to fall.
But we cannot assume that inflation will automatically cease to be a problem once the supply of food improves and food prices fall.

This is because there is a serious danger that the current high food prices, the higher prices of fuel and other imported goods, triggers a rise in inflation of prices throughout the economy.

This leads to a self-reinforcing cycle of wage and price increases with high inflation becoming entrenched.
There are some worrying signs that this has begun to occur.

Therefore, curbing the demand for goods and services will take the heat off inflationary pressures.
We are using the Central Bank Rate (CBR), which provides a signal for short-term interest rates.

We raised the CBR to 16% in September, from 13% in July to encourage commercial banks to raise interest rates on loans, which has already begun.
This will reduce the growth of their lending to the private sector, which has been buoyant.
Curtailing credit growth is unavoidable if we are to bring inflation down.

It is necessary to reduce the pace of private sector spending to dampen demand pressures on prices.

Higher interest rates will also encourage households to curb consumption and save.

They (interest rates) will also encourage larger firms to seek finance from external sources.

It is inevitable that annual inflation rates will rise further in September and October, because of the recent increases in the prices of charcoal, food stuffs and mobile phone call charges. But it should peak before the end of 2011 and begin to fall back.

It is difficult to forecast how quickly inflation will fall. We do not know what further shocks might affect prices in the future.

But we can pull annual inflation down to between 10 and 14% by this time next year and reach our 5% target by the first half of 2013.
We will be robust in raising interest rates and keeping them high until we are confident that inflation is falling back to the 5% target.
Firms should consider this when deciding to raise their prices.

If they think high inflation is here to stay and raise prices excessively, they will risk pricing themselves out because their customers will not have the money to pay.
Our assessment is that economic growth will fall to 5% from the original projection of 6.5%.
That is the price we pay for re-establishing stability in the market.

What is the Bank of Uganda doing about the exchange rate?
Our total exports are $2.5b and total imports are $4.5b. We have a trade deficit of $2b, which we have to close.
Components that can close this gap like the remittances have been weak because of the global crisis.
This is no longer a reliable source.

Even the grants have been weak. We have to reduce the demand for imports or increase capacity for exports.

Our policy is to allow exchange rate to be determined by market forces.
The economy is open to trade and capital flows.
This is subject to frequent external shocks.
It is difficult and counter-productive to control exchange rate.

But the Bank of Uganda intervenes in the market by buying and selling foreign currency if the movement in the exchange rate is too rapid because this is potentially disruptive for firms which use foreign exchange.

Our monetary policy also has indirect effects on the exchange rate because interest rates have influence on capital inflows and outflows.
Higher interest rates will normally serve to strengthen the exchange rate and vice-versa.

Have we ever been here before and dug ourselves out?
Uganda has experienced supply side shocks before. The recent was in 2008, when annual headline inflation rose to 15.9% due to food price inflation, which climbed to 33.6%.
As is the case today, 2008 was also a year of high global food price inflation.
The Bank of Uganda responded by tightening monetary policy.

This, with the return of better harvests in 2009 and 2010, brought headline inflation back to single digits by January 2010, while annual core inflation was brought down to the 5% target by May 2010.

The lesson draw from this experience is that, if policy-makers react with sufficient resolve, it is possible to bring inflation down after supply side shocks, but it does not happen quickly.

What do we need to take from this “crisis” to make the economy resilient?
Policy-makers need to address underlying structural weaknesses, which beset our economy.

Uganda is a very fertile country, but is food insecure. We should regularly generate food surpluses to export to the region and hold sufficient stocks to prevent shortfalls on domestic markets during poor harvests.
To achieve this, it is imperative to modernise and commercialise agriculture, storage facilities, transportation and marketing of farm produce.

Secondly, the economy needs to be competitive on regional and world markets, generate more formal sector jobs to reduce unemployment and increase real wages.

The country’s competitiveness is affected by poor infrastructure, weaknesses in higher education and training, poor governance in the public sector and the heavy burden of diseases. These are deficiencies which have to be tackled urgently.


National Insurance owners to raise sh7b
Friday, 30th September, 2011
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By David Mugabe

NATIONAL Insurance Corporation (NIC) management put up a spirited fight reassuring shareholders about the state of the firm in a stormy annual general meeting (AGM) on Wednesday.

In one of the most heated AGMs in Uganda, shareholders ultimately voted for NIC to undertake a rights issue to raise sh7b to fulfill the new statutory requirements by the industry regulator that operators shore up their capital.
A rights issue is an issue of additional shares to existing shareholders by a company to raise capital.

The Uganda Insurance Commission, the industry regulator, is proposing that paid up capital be raised from sh1b to sh5b for life and sh10b from sh5b for life and non-life firms. The rights issue will fund the recapitalisation.

During the four-hour meeting, there were moments of altercations between NIC chairman Remi Oluwude, whose Nigerian-based Industrial and General Insurance holds a major stake and Sudhir Rupareila, who controls a 20% stake in NIC, on how the voting should proceed.

Shareholders were given three options; the company to do a rights issue immediately or a rights issue and a public offer together, and a rights issue then after a public offer, if the rights are not completely taken up.

The majority shareholders voted for a rights issue and an option of a public offer that will provide shareholders another chance to take up shares.

NIC has suffered a battered image arising from its conflicts with Makerere University over the pensions funds claims. Oluwude admitted that the institution was undergoing “trying times.”

“We are trying to reposition the company for future growth but NIC has the capacity to pay what is legally acceptable,” said Oluwude.

Board member Dr Martin Aliker said the Makerere issue had caused a lot of damage to NIC.

“It is a good thing that it has now gone to court. If the court says we pay, we will,” said Aliker.

Olowude assured shareholders of no selfish interests, saying he was not interested in more than 60% stake that his firm holds in NIC.

“It is better to give ordinary Ugandans more chances to buy shares. If people don’t take up their rights, then we do a public issue later,” said Oluwude.


Kinyara Sugar closes for maintenance
Friday, 30th September, 2011
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By Gladys Baligonzaki

KINYARA Sugar will close from today for one-and-half months for regular annual maintenance. The factory is expected to reopen on November 15, Pallipuram Ramadasan, the general manager, said.

“The public should not worry about fresh sugar shortages in the market. We have 4,000 tonnes of sugar in stock. We will continue distributing for the period we will be under maintenance,” Ramadasan said.

The factory, that crushes 4,000 tonnes of cane daily, produces 350 to 400 tonnes of sugar annually, a steady growth from the 175 to 200 tonnes three years ago. Kinyara has improved the road network in Masindi District by grading the entire Kabango Township.

The township is a fast-growing rural centre in Budongo sub-county due to increased incomes out-growers who supply cane to Kinyara.

The firm has also graded all the roads in its areas of operation, including the Kibwona-Kabalye and Terere-Kimanya roads. The Bwijanga-Rusangura and Isimba-Kitamba roads will also be developed to ease sugarcane transportation to the factory.

“Plans are underway to start collecting garbage in Kabango. We have set up garbage collecting sites. We will be sending trucks to collect garbage piled in particular places. We have also set up new garbage collection centres in Masindi Municipality,” Ramadasan said. Kinyara pays sh450m to sh500m per month in wages to sugarcane cutters. Up to sh600m is paid to the cane transporters monthly.

Ramadasan said the firm would sensitize schools in and around the factory about the effects of sugarcane fires.

The campaign will cover advantages of green cane harvesting and sugarcane agriculture.

Maharajan Subbaiah, the agricultural manager, said the students have been given stickers on the advantages of sugarcane, which they are expected to take down to their parents.

[u.g boy]

KCCA begins illegal structure demolition in the city.
Saturday, 1st October, 2011
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A KCCA bulldozer bringing down one of the buildings.

KAMPALA Capital City Authority (KCCA) in the wee hours of the Saturday started demolition of illegal staircases in city that do not have plans to operate in Kampala and are blocking pedestrians.

The exercise that started this morning by KCCA officials was made known to the owners of the buildings through a month’s notice, one that they never complied to.

On Saturday morning owners of the businesses located on the staircases shed tears while others lamented that they were not warned.

About eight buildings which included among others Nabukeera Plaza, Quicell, Premier Arcade, Leisure Tech Hotel and other commercial structures on Nakivubo road and had their staircases razed down.

Other buildings that may face demolition of their staircases are Jesco, Skyline shoppers on Nabugabo road among others.

These buildings have illegal staircases that were blocking pedestrians.

The demolished structures and premises are those that were constructed without KCCA plan and those that have failed to pay business permit.

George Agaba director of physical planning KCCA said the exercise will register demolition of kiosks, Toilets Shops and other illegal structures in and around the city.

Some of the owners of the buildings say that they have approved plans that were used to construct.

Agaba insists that the owners of the buildings were given prior time to register their businesses or present evidence of payment business fees and their construction plans as approved by KCCA.

However, some of the owners of the buildings say that it was a short notice.

This exercise is to continue into parts of the central business district and its suburbs with the demolition of structures that weren’t approved by KCCA and this comes at a time to make the city have the standards that match the international standards.

Last week the KCCA executive director Jennifer Musisi issued enforcement notices to property owners.

[u.g boy]

New Vision’s Best and Worst is back
Saturday, 1st October, 2011
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By GILBERT KIDIMU

THE year is coming to a close and several things have occurred to make you smile or frown. The New Vision now gives you a chance to voice out your concerns on the Best and Worst personalities or Government programmes of 2011. Entries will be entered into a draw, where 10 lucky readers stand to win sh50,000 each.

Starting today, New Vision will for the next week publish the entry coupons for the public to nominate their best and worst personalities of 2011. Thereafter, the coupons shall be published in Saturday Vision and Sunday Vision only.

“We would like people to voice their thoughts about what is going on by filling in the coupons,” said David Mukholi, the Managing Editor – Editorial.

All one has to do is fill in the coupon, attach a copy of your identity card and send the coupon to the New Vision, Best and Worst survey. Readers in Mbale, Soroti, Mbarara, Jinja, Gulu and Lira can send their responses to New Vision agents or offices in the towns.

Send only the original New Vision coupons. Photocopies or e-mail entries shall not be considered.

[u.g boy]

Real estate has bright prospects, says player
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By Wandera Stephen (email the author)

Posted Monday, October 3 2011 at 18:25
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A key player in Uganda’s real estate business has said the sector has a lot of growth potential given the increasing need of business space.

Speaking at the signing of the Shs112 billion deal between Roko and the Mukwano Group, for the construction of the Acacia Mall, Mr Alykhan Karmali, the Mukwano Group managing director said real estate has become the ‘next big thing’, thus investors can no longer ignore the sector due to its fast rate of growth and the need for business space. He said: “Mukwano is seeking to turn Kampala around through the construction of premium investment in the form of shopping malls and office complexes.

The group has become a major player in real estate with investments in and around Kampala. Uganda’s real estate business has grown over the years driven by need for more office space and residential properties.

Firms like NSSF, Akright and Jomayi among others have boosted the growth in the sector through constructing office spaces and residential properties. Acacia Mall, with an investment of Shs112 billion, is expected to be one of East Africa’s largest shopping centres.

Bujagali, Nyagak power plants ready
MONDAY, 03 OCTOBER 2011 06:23 JOSEPH OLANYO
KAMPALA, UGANDA - The long awaited Bujagali and Nyagak hydropower projects expected to mitigate the acute electricity supply deficit, will be online in November and December 2011respectively.

Bujagali Hydropower project's 250MW, which suffered a major setback after its development efforts were frustrated by internal and external factors, will generate the first unit of 50MW. Nyagak will produce 3.6MW.

This will bring an additional 53.6MW to the National Grid. The additional 53.6MW power supply from Bujagali in Jinja and Nyagak in Zombo district will bring to 433.6MW total supply on the national grid.Uganda's current generation capacity is 380MW, which is only 10% of the target of 3800MW set in the National Development Plan (NDP).

Speaking during a joint visit of energy sector projects in West Nile region funded by Germany and the European Union (U), the Minister for Energy and Mineral Development, Irene Muloni, said Bujagali, the major setback to Uganda's power sector, would have come on line by end of 2004.

"The project is in its advanced stages and we are expecting the first unit of 50MW to come online in November 2011 and the whole plant's 250MW commissioned by April 2012," Muloni said.


EU Envoy to Uganda, Roberto Ridolfi, German Envoy Klaus Dieter Duxmann and Uganda's Energy Minister Irene Muloni listening to electricity views from West Nile region officials last week. (Photo By Joseph Olanyo)


The Minister said feasibility studies for the development of Karuma Hydropower Project (600MW) and Ayago (600MW) have also been finalised.
She said the Ministry is now in the process of procuring the Project Manager and the Engineering, Procurement and Construction (EPC) contractor.

"It is envisaged that these will be on board by the end of January 2012 and the construction of the project will take about four to five years therefore by 2016 we shall have Karuma's first unit come on line" Muloni said.

The minister's remarks come amidst raging and deteriorating power supply that has led to intensive load shedding. Power cuts in the country have now reached an alarming level of 24hr daily. The additional supply is expected to ease the rampant load shedding and reduction in use of expensive thermal power generation.

Addressing the delegation, which included Parliamentarians in Arua, the German Ambassador to Uganda, Klaus Dieter Duxmann, said Germany committed 120 million Euros (UgShs47 billion) to Uganda in 2010 for a three year period, an increase of almost 60% compared to the previous three years.
Klaus said a substantial amount of the assistance was given to the energy sector, which the German and Ugandan Government declared as a total area of cooperation.

"We believe that energy is vital to economic growth, and clean energy is a key driver to a sustainable future," Klaus said.The Uganda-Germany development cooperation has been a long standing partnership of over 30 years EU Ambassador, Roberto Ridolfi, says limited access to energy is a major constraint to Uganda's development and yet the country has a significant potential of renewable energy power estimated at 5,300MW.

Rudolf says the government wants to exploit this potential and increase the use of modern renewable energy from the current 4% and 61% of the total energy consumption by 2017.

"The main financing instrument of the energy partnership is the EU energy facility, which is supporting energy investments through grants across Africa," Ridolfi said.
During the visit of the region accompanied by mostly Members of Parliament from the West Nile region, the Minister and Ambassadors launched Menyar Pico hydropower scheme in Moyo. Pico is a rural community power scheme that supplies power for lighting to 78 households.
The delegation also visited Oloko Secondary School, one of the 47 institutions in the region that have been electrified using Solar PV, with the support of Germany and the EU through German Development Cooperation (GIZ).