{"id":30087,"date":"2022-04-25T16:51:01","date_gmt":"2022-04-25T16:51:01","guid":{"rendered":"https:\/\/www.africa-press.net\/uganda\/all-news\/govt-smells-the-coffee-in-bad-deal-softens"},"modified":"2022-04-25T17:06:41","modified_gmt":"2022-04-25T17:06:41","slug":"govt-smells-the-coffee-in-bad-deal-softens","status":"publish","type":"post","link":"https:\/\/www.africa-press.net\/uganda\/all-news\/govt-smells-the-coffee-in-bad-deal-softens","title":{"rendered":"Govt smells the coffee in bad deal, softens"},"content":{"rendered":"

Africa-Press – Uganda. <\/strong><\/span>Faced with a simmering fury over a multi-billion coffee deal with Uganda Vinci Coffee Company Limited (UVCC), the government is now considering reviewing contentious clauses in the agreement, and has lined up a cocktail of incentives for new investors.<\/p>\n

The Secretary to Treasury, Mr Ramathan Ggoobi, and Investment minister Evelyn Anite have separately confirmed plans to review the controversial coffee deal and invited new investors who are willing to add value to Uganda\u2019s coffee to contact Uganda Investment Authority.<\/p>\n

\u201cWe have not in any way created monopoly in coffee business as some people claim, our door is open to any investor who would like to do value addition to coffee and will be supported with tax and non-tax incentives,\u201d Ms Anite said.<\/p>\n

READ:<\/b><\/p>\n

Faces behind Uganda Vinci Coffee unveiled<\/p>\n

Mr Ggoobi yesterday declined to discuss the disputed clauses in the MoU that Finance minister Matia Kasaija signed with UVCC on February 10.<\/p>\n

He instead warned those against key economic reforms that \u201cthe days of debates and normative economics are over\u201d.<\/p>\n

Mr Ggoobi added: \u201cSome interest groups wouldn\u2019t want the status quo to change since they benefit from it. So they would deliberately mislead the public to resist policy change\u201d.<\/p>\n

Ggoobi explains errors<\/b><\/p>\n

The Finance Permanent Secretary, however, admitted: \u201cSometimes policy makers make mistakes but the errors shouldn\u2019t be exaggerated to throw the baby out with the bathwater. They [errors] should be pointed out and corrected and let the greater good to flourish. That\u2019s how countries develop\u201d.<\/p>\n

Mr Kasaija is expected to issue a statement after a joint stakeholders\u2019 meeting, tomorrow, specifying the detailed amendments to clause 4.2.1 and 4.2.2 of the Memorandum of Understanding signed with UVCC.<\/p>\n

There are also calls from MPs to review clauses 4.1 and 4.1.1 that had provided for \u201ca tax-neutral\u201d basis and tax exemptions.<\/p>\n

In the aforementioned two clauses, the government had promised to take all reasonable measures to give priority of supply of coffee beans (including screen 18 and above) to the company and allowed the firm to determine the coffee prices.<\/p>\n

Some lawmakers as well as players in value chain have criticised the coffee deal for creating a monopoly in a free market economy.<\/p>\n

They have also accused the government of pampering UVCC to the detriment of local coffee producers and other potential investors.<\/p>\n

Speaking to Daily Monitor at the weekend, Ms Anite confirmed government plans to look into the MoU and invite local and foreign investors to tap into coffee industry and benefit from government incentives.<\/p>\n

\u201cAs government, we will look into the MoU we signed with UVCC, but people should know that our main objective is to attract investors who can help us process our coffee into roasting and instant coffee for the local market to the level of Nescaf\u00e9 and others,\u201d Ms Anite said.<\/p>\n

\u201cSelling our coffee in raw form is not helping us. More than 95 percent of our coffee is exported as green beans\u2026 We are throwing away money and that is why we have put in place incentives to change this. We are inviting investors to add value to our coffee. We want to see better coffee quality and better prices for our products,\u201d she added.<\/p>\n

Mr Ggoobi reiterated: \u201cWhoever comes up to add value to people\u2019s produce in agro-processing and value addition, particularly for export, qualifies for generous support, including investment incentives. There is misinformation that only investors are benefiting from these incentives. This is not true\u201d.<\/p>\n

\u201cThe short time I have been in office as [permanent secretary] I have signed tens of letters offering incentives to investors both local and foreign to add value to our agricultural produce,\u201d he added.<\/p>\n

Mr Ggoobi also said they would spend more time implementing what is written in policy documents and plans such as NDP III, NRM Manifesto, and annual budgets.<\/p>\n

Although contracts involving foreigners attract more attention and controversy, Mr Ggoobi said: \u201cThere are many Ugandans who have benefited from government incentives. We are only decent and professional not to publicise them…Ugandans must get organised and benefit from the government incentives.\u201d<\/p>\n

The UIA board chairman, Mr Morison Rwakakamba, said Uganda is a liberalised economy and that all domestic and foreign investors have access to codified incentives to invest in any sector including coffee.<\/p>\n

\u201cWe see an increase in investors seeking licensing from UIA to invest in value chain and this is the news,\u201d Mr Rwakakamba said.<\/p>\n

Nakaseke Central MP Allan Mayanja, however, told Daily Monitor that inviting new investors without amending the coffee agreement is self-defeating.<\/p>\n

Mr Mayanja cited clause 4.2.2 which he said unfairly creates a sole buyer of Ugandan coffee and allows the same company to set the prices in a liberalised economy.<\/p>\n

\u201cGovernment is trying to put the cart before the horse. The right thing to do is first amend the coffee agreement, remove all the toxic clauses and then invite new investors to do value addition. We need to create an enabling environment for investors in ventures that process our coffee into roasting and instant coffee for local and export market,\u201d he said.<\/p>\n

On April 12, Speaker of Parliament Anita Among directed the Committee on Trade Tourism and Industry to probe the controversial coffee deal signed between Mr Kasaija, who represented government and Italian investor Enrica Pinneti on behalf of UVCC.<\/p>\n

The Kimanya-Kabonera MP, Dr Abed Bwanika, raised a matter of national importance and questioned the deal.<\/p>\n

He said it alienates Ugandans from the coffee business as it gives monopoly of purchase and export of coffee to only one company in violation of Section 52 of the Coffee Act.<\/p>\n

The Trade committee is still investigating the matter and has summoned Ms Penetti and other government officials to explain the controversies in the deal.<\/p>\n

Some incentives<\/b>
\nAgriculture sector<\/b><\/p>\n

\u00b7 10-year exemption on Income from commercial farming.<\/p>\n

\u00b7 10-year exemption on income from agro-processing.<\/p>\n

\u00b7 Exemption on export processing zone on imported raw materials and intermediate goods, machinery and equipment, spare parts for exclusive use in the Free Zone.<\/p>\n

\u00b7 Exemption from import duties on plant and machinery.<\/p>\n

\u00b7 For commercial farmers, upon registration for VAT, are entitled to full VAT claims.<\/p>\n

\u00b7Unprocessed agricultural products are exempt from VAT, which relieves processors from cash flow constraints.<\/p>\n

Manufacturing sector<\/b><\/p>\n

\u00b7 10-year exemption on export of finished consumer and capital goods for investors exporting 80% outside domestic market.<\/p>\n

\u00b7 VAT deferment on plant and machinery<\/p>\n

\u00b7 0% import duty on plant and machinery<\/p>\n

For More News And Analysis About Uganda<\/a> Follow Africa-Press<\/a><\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"

Africa-Press – Uganda. Faced with a simmering fury over a multi-billion coffee deal with Uganda Vinci Coffee Company Limited (UVCC), the government is now considering reviewing contentious clauses in the agreement, and has lined up a cocktail of incentives for new investors. The Secretary to Treasury, Mr Ramathan Ggoobi, and Investment minister Evelyn Anite have […]<\/p>\n","protected":false},"author":84,"featured_media":30086,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2,7,8,12],"tags":[233,240,234],"class_list":["post-30087","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-all-news","category-head-lines","category-homepage-english","category-policy","tag-africa-press","tag-africa-press-uganda","tag-uganda"],"yoast_head":"\nGovt smells the coffee in bad deal, softens - Uganda<\/title>\n<meta name=\"description\" content=\"Faced with a simmering fury over a multi-billion coffee deal with Uganda Vinci Coffee Company Limited (UVCC), the govern ...\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.africa-press.net\/uganda\/all-news\/govt-smells-the-coffee-in-bad-deal-softens\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Govt smells the coffee in bad deal, softens\" \/>\n<meta property=\"og:description\" content=\"Faced with a simmering fury over a multi-billion coffee deal with Uganda Vinci Coffee Company Limited (UVCC), the govern ...\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.africa-press.net\/uganda\/all-news\/govt-smells-the-coffee-in-bad-deal-softens\" \/>\n<meta property=\"og:site_name\" content=\"Uganda\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/AfricaPressTunisiaa\" \/>\n<meta property=\"article:published_time\" content=\"2022-04-25T16:51:01+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2022-04-25T17:06:41+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/static.africa-press.net\/uganda\/sites\/34\/2022\/04\/postQueueImg_4-6266d509b7e79.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"1200\" \/>\n\t<meta property=\"og:image:height\" content=\"800\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"cfeditoren\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"cfeditoren\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"5 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\/\/www.africa-press.net\/uganda\/all-news\/govt-smells-the-coffee-in-bad-deal-softens#article\",\"isPartOf\":{\"@id\":\"https:\/\/www.africa-press.net\/uganda\/all-news\/govt-smells-the-coffee-in-bad-deal-softens\"},\"author\":{\"name\":\"cfeditoren\",\"@id\":\"https:\/\/www.africa-press.net\/uganda\/#\/schema\/person\/068c7ab4e9634ae78ec5d54ec46598bb\"},\"headline\":\"Govt smells the coffee in bad deal, softens\",\"datePublished\":\"2022-04-25T16:51:01+00:00\",\"dateModified\":\"2022-04-25T17:06:41+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\/\/www.africa-press.net\/uganda\/all-news\/govt-smells-the-coffee-in-bad-deal-softens\"},\"wordCount\":1071,\"commentCount\":0,\"image\":{\"@id\":\"https:\/\/www.africa-press.net\/uganda\/all-news\/govt-smells-the-coffee-in-bad-deal-softens#primaryimage\"},\"thumbnailUrl\":\"https:\/\/static.africa-press.net\/uganda\/sites\/34\/2022\/04\/postQueueImg_4-6266d509b7e79.jpg\",\"keywords\":[\"Africa Press\",\"Africa Press-Uganda\",\"uganda\"],\"articleSection\":[\"all news\",\"head lines\",\"homepage-english\",\"policy\"],\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"CommentAction\",\"name\":\"Comment\",\"target\":[\"https:\/\/www.africa-press.net\/uganda\/all-news\/govt-smells-the-coffee-in-bad-deal-softens#respond\"]}]},{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.africa-press.net\/uganda\/all-news\/govt-smells-the-coffee-in-bad-deal-softens\",\"url\":\"https:\/\/www.africa-press.net\/uganda\/all-news\/govt-smells-the-coffee-in-bad-deal-softens\",\"name\":\"Govt smells the coffee in bad deal, softens - 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