Archive for category: sugar cane out-grower

SEMBABULE: Plans are underway to revive Taala Ya Mawogola Savings and Credit Cooperative Society Ltd, four years after the SACCO collapsed, theCooperator has learned.

Simon Peter Ddungu, the Sembabule District Commercial Officer told theCooperator that the district leadership had resolved to mobilize widely for the revival of the SACCO, owing to the significant role the SACCO was playing in shoring up the economic fortunes of the district’s residents.

Tracing back the SACCO’s roots.

For close to ten years, Taala Ya Mawongola SACCO was the oldest community-based Microfinance institution in Sembabule district, growing to rank among the leading SACCOs in Masaka sub region.

Headquartered in present-day Mateete Town council, the SACCO had been founded in 2005, one of the very first financial institutions in the district, to safeguard people’s savings and provide soft loans to shore up mushrooming SMEs in the region.

Godfrey Mutamba, one of the founder members of the defunct SACCO revealed that the SACCO was a joint idea of thirteen prominent farmers in Mateete Sub county, whose interest was to pull together resources through a savings scheme and eventually lend it to people that needed pushup capital at affordable interest rates.

“People gradually embraced the idea because it was being advanced by people of repute in the area. And the SACCO was opened to people from all walks of life who began saving with it, leading to its expansion,” he told theCooperator.

To qualify for a loan of say Shs.1million, SACCO members were required to pay a registration fee of 10,000 shillings and buy ten shares at Shs.12,000.

According to available records, by 2011, Taala Ya Mawogola SACCO had accumulated a loan book of more than shs.1.3 billion, comprising of members’ savings, share capital and Interest accumulated on loans.

The Microfinance had also opened two other branches in Sembabule Town Council and Bukomansimbi district, expanding its membership to over 5,000 direct clients.

By then, Mutamba told theCooperator, the SACCO had supported several successful local enterprise groups which they hoped would later merge into a union and later transform the SACCO into a cooperative bank.

Trouble knocks.

All the SACCO’s plans were however dashed when in 2011, the General manager disappeared with members’ savings, setting in motion a slow and gradual collapse of the SACCO.

Benon Ssebyanzi, one of the affected members recounted to theCooperator that in May 2011, rumors of financial mismanagement at the SACCO started emerging, prompting members to demands for a special audit and investigation of the General Manager, Ibrahim Were.

According to Ssebyanzi, during the members’ Annual General Meeting that year, Were asked for time to prepare a report before he could leave office, but would instead disappear with over Shs.600 million of members’ savings a few days later.

When an external audit was eventually done by the Uganda Microfinance Support Center (MSC), it was found that the SACCO had suffered an even bigger financial loss of Shs.83o million in syndicate fraud.

The report showed that the money had been swindled while in transit to the SACCO’s account in a commercial bank in Masaka. It (the report) faulted the SACCO’s board for accepting to be manipulated into signing blank cheques, which allowed the general manager an opportunity to fill in any figures he wished, before withdrawing the money that could not be accounted for.

Eventual collapse

Yudaya Namirembe, another member of the SACCO says the fraud become the precursor to the eventual collapse of the institution, whose public trust had been severely eroded.

“We tried to retrieve our deposits in vain, despite having our deposit books indicating account balances,” she says, adding that even creditors chose to default on their loans.

Frank Lubowa, the Chairperson of the new board which was constituted to try and keep the SACCO afloat in 2014 says their efforts did not yield any results.

“We had secured another loan of Sh.70million from the Micro-Finance Support Center to recapitalize the SACCO, but all the money was eventually spent clearing members whom the SACCO owed money,” he explained.

The SACCO finally closed shop in 2015.

Attempting a comeback.

The SACCO’s collapse left a significant void in the economic life of the district’s residents, affecting the overall productivity in the district.

Ddungu assured theCooperator that the district leadership is determined to bring the SACCO back to life. “We cannot afford to lose that SACCO completely,” he told us.

“We are exploiting all public spaces like churches, Mosques and social gatherings to mobilize these people to rebuild the SACCO after all their assets are still intact,” he added.

In March this year, the Micro-Finance Support Center attempted to attach the SACCO buildings to recover its loan debt, but according to Ddungu, the government intervened and secured the SACCO’s assets.

He is also optimistic that going forward, with the new Uganda Microfinance Regulatory Authority, irregularities such as the ones that led to Taala Ya Mawogola’s collapse will be detected in time to prevent the fate that befell their SACCO.

The post Sembabule’s Taala Ya Mawogola plots comeback, 4 years after collapse appeared first on The Cooperator News.

Government has committed to step up the reach and diversity of extension services available to smallholder farmers and cooperatives, in a bid to promote agricultural mechanization and increase the productivity of the Agricultural sector.

Presiding over the 9th Joint Agricultural Sector Annual Review (JASAR) held at Speke Resort Munyonyo on Thursday, Vincent Ssempijja, the Minister for Agriculture, Animal Industry and Fisheries(MAAIF) noted that extension services were critical to government’s plan to transform the 68% largely subsistence households in the country into commercial production, as part of the governments agro-industrialization strategy.

Currently, Ssempijja said, MAAIF, with support from development partners like the Food and Agricultural Organization (FAO), the United States Agency for International Development(USAID) and the Kingdom of Netherlands, are promoting four different models of service delivery to improve efficiency and effectiveness of the extension services.

“The models include the farmer field schools, village agent model, nucleus farmer model, and the four-acre model,” he said, affirming that “the models have been developed to support commercialization of smallholder farmers and are being integrated in the extension services system.”

Currently, the ratio of extension workers to farmers is 1:1800, way above the internationally recommended 1:500. But Ssempijja argued that there has been a significant improvement over the last two years, noting that in 2015/16, the ratio of extension worker: farmer stood at a staggering 1:5000.

“Following the adoption of the Single Spine Extension System, Government embarked on a recruitment drive of Agricultural Extension Staff, which has seen 3,872 extension workers recruited over the last two years,” he said.

Ssempijja said that with support from International Fund for Agricultural Development (IFAD), MAAIF has been able to procure and facilitate the extension staff with 113 Double Cabin vehicles and 1,034 motorcycles, to increase their efficiency and mobility.

Despite the inroads made, the ministry was still 1,128 extension staff-short of the targeted 5000 for the 2018/19 financial year, and way below the required 12,000 extension workers by local governments nationally in the medium term.

Ssempijja blamed the shortfall on what he called an “insufficient resource envelope,” noting that MAAIF submitted a budget of Shs.50bn for extension staff wages and Shs.56bn for non-wage expenses to the Ministry of Finance, Planning and Economic Development in the last financial year, which was not honored.

“More resources are required to step up recruitment and procure more transport equipment for extension workers,” he said, before adding: “More money is needed to increase the operational funds from the current Shs.39.6 billion and to support continuous capacity building of the workers.”

Towards agriculture mechanization, the ministry revealed that it had procured 284 tractors and two sets of earthmoving equipment, which would be hired out to farmers and cooperatives at subsidized costs. Ssempijja said that MAAIF would procure and distribute 162 additional tractors 200 lower level mechanization equipment like ox-plows, and 130 solar water pumping systems. “These efforts will unlock systemic constraints that affect the livelihood of smallholder farmers,” he emphasized.

Re-echoing the minister’s remarks, MAAIF Permanent Secretary Pius Wakabi Kasajja however urged farmers to register and work in organized groups like cooperatives, arguing that it would be easier and cheaper that way for them to access the vast range of agricultural services on offer, from credit to agricultural Insurance and agro-inputs.

“This (farmer cooperatives) will also help us link them to agro-processing facilities being coordinated by the extension service network in the country,” Wakabi Argued.

The post Government to step-up extension support for farmers appeared first on The Cooperator News.

Piecemeal interventions and poor coordination among institutional actors in the Agriculture sector have been blamed for the lack of a robust agro-industrialization policy to achieve Uganda’s development targets.

Speaking at the 9th Joint Agricultural Sector Annual Review held at Speke Resort Munyonyo, Dr. Madina Guloba, a senior research fellow at the Makerere -based Economic Policy Research Centre noted that the dis-jointed interventions by the numerous state and non-state actors in the Agri–industrial sector were making it difficult to execute a systematic, nationally transformative policy agenda, in line with Uganda’s development needs.

“Poor coordination of (sector) actors complicates the consolidation of institutional efforts towards the development of a common agro-industrial goal, further undermining the ability of already meager resources to deliver needed interventions,” she said.

Presently, Uganda has several agencies involved at various stages of the agri-business value chain. These include; the National Agricultural Research Organization (NARO) and the Uganda Industrial Research Institute(UIRI) at research level, the National Agricultural Advisory Services (NAADs) and Operation Wealth Creation for inputs supply and implementation, the Uganda Development Cooperation and Export Promotions Board at investment and marketing level respectively, not to mention the parent ministries of Agriculture, Animal Industries and Fisheries, and that of Trade, Industry and Cooperatives, who’re charged with overall policy formulation and oversight.

There are also crop-specific agencies like the Uganda Coffee Development Authority and the Cotton Development Organization, whose mandates cut across the regulation of the coffee and cotton sectors respectively, and the promotion of coffee and cotton exports.

Highlighting the government’s economic growth strategy for the financial year 2019/2020, Finance Minister Matia Kasaija noted that the government would “aggressively” pursue agro-processing and the development of product value chains to create high-value jobs and expand the industrial base of the economy.

“Uganda’s industrialization in future has accordingly been designed on two strategic pillars; the setting up of fully serviced industrial parks across the country to house medium and large-scale industries, and two, the development of product value-chains which link nucleus entrepreneurs to out-grower farmers to promote agro-processing for value addition,” Kasaija said, at the budget reading in June.

But Madina says, there has yet to be a specific major policy shift especially in the direction of developing product value chains. According to the United Nations Industrial Development Organisation (UNIDO), Uganda enjoys a positive balance of $420million in agro-products’ trade, importing $1.07billion worth of good, while exporting $1.5billion in 2017. But Madina insists, Uganda can do much better if it prioritizes a few specific commodities and products.

She pointed out that while for example Milk, coffee, Tea and Fisheries have the potential to become high-impact export products, dairy, cotton, vegetable oil, and beef by-products should be the target of an import substitution policy, calling for increased public investment in high-value agro-manufacturing. “There’s, for example, no reason why 95% of our lint should still be exported, when we import millions of dollars- worth of cotton by-products,” she said.

She said that achieving such targets required a deliberate policy from government to protect domestic industries especially at infancy, and availing them affordable and patient credit, noting that Uganda remained a poor performer on this aspect (credit access). According to UNIDO, by 2016, only 6.3% of small-scale industries had loans or lines of credit in Uganda compared to 44.1 % in Kenya and 11.1% Tanzania.

“But it also requires building strong traceability systems and linkages between producers and manufacturers to guarantee product quality and standards, to secure and safeguard local and international markets,” she said.

The Joint Agricultural Sector Review is an annual event organized by the Ministry of Agriculture, Animal Industries and Fisheries in collaboration with development actors in the Agriculture sector, to review the sector’s performance against set targets and suggest corrective proposals going forward. The event has been organized since 2011, and this year’s Review took place from 28th-30th August 2019, at the Common Wealth Resort, Munyonyo.

The post Uganda lacks a coherent agro-industrialization policy – EPRC’s Guloba appeared first on The Cooperator News.