By Mulengera Reporters
The Leader of Opposition (LOP) in Parliament, Joel Ssenyonyi, has raised serious concerns about the lack of legally binding agreements between the Government of Uganda and Inspire Africa Coffee Factory, a private entity that has received taxpayer funding.
Inspire Africa Coffee Factory, located in Rwashamire Town Council, Ntungamo District, aims to add value to Uganda’s coffee exports. However, Ssenyonyi, in a report submitted to Parliament on Tuesday, February 11, 2025, revealed that while the Government has injected UGX 112 billion into the project through the Science, Technology, and Innovations Secretariat under the Office of the President, there is no memorandum of understanding (MoU) between the two parties.
“We found that there is no memorandum of understanding between the Government of Uganda and this private entity. The manner in which taxpayer money was extended to the entity is unclear. It is wrong for taxpayers’ money to be spent without any clearly defined binding relationship between the Government and Inspire Africa Coffee, and no documentation whatsoever,” Ssenyonyi stated.
During a recent visit to the facility, Ssenyonyi said his team was informed by the proprietor that there exists a co-investment arrangement with the Government. However, the details of this arrangement—whether it involves joint shareholding or a grant—remain unclear.
Ssenyonyi recommended that Parliament compel the Government to clarify its relationship with Inspire Africa Coffee before making any further financial appropriations to the entity.
The Auditor General’s reports have previously flagged similar arrangements, including unclear shareholding agreements in other projects like Roko Construction Company.
UGANDA’S COFFEE SECTOR
Uganda has made significant efforts to maintain its position as a leading coffee producer globally. The country exported 6.13 million bags of coffee in the 2023/2024 financial year, earning $1.144 billion. However, most of these exports were unprocessed, prompting calls for value addition to maximize earnings for farmers.
Currently, coffee prices have risen to UGX 18,000 per kilogram at the farm gate due to reduced production in Brazil, the world’s leading coffee producer, which faced severe weather challenges last year.
Ssenyonyi also criticized the Government for failing to fulfill its commitments under the third National Development Plan (NDP III), which outlined the establishment of two modern industrial coffee factories in Bugisu and Buganda regions.
“Government should budget for and embark on fulfilling its commitment under NDP III to build coffee factories in Bugisu and the Central region. The capacity of Inspire Africa Coffee Factory is small compared to the magnitude of coffee produced in various parts of the country. Besides, it is impractical for farmers to transport coffee from distant districts to Ntungamo for processing,” Ssenyonyi said.
PROJECT IMPLEMENTATION
Ssenyonyi also revealed that the proprietor of Inspire Africa Coffee Factory was unsure of the exact amount of funding received from the Government as the project nears completion. The factory is expected to start production next month.
“Government should explain to Parliament and the country how much money has been injected into the project, the terms of the agreement, and how taxpayers will benefit from this investment,” Ssenyonyi added.
RATIONALIZATION OF UCDA
Last year, Parliament rationalized the Uganda Coffee Development Authority (UCDA), transferring its functions to the Ministry of Agriculture. The move aimed to reduce duplication and save costs. However, the decision sparked controversy, with MPs from coffee-producing areas expressing concerns about the future of the sector.
UCDA had previously performed well and held licenses with international players to market Uganda’s coffee. MPs warned that its dissolution could affect Uganda’s global standing in the coffee industry.
As the Government faces increasing scrutiny over its investments in the coffee sector, Ssenyonyi’s revelations are likely to spark further debate about accountability and the need for transparency in public-private partnerships-Parliament Watch. (For comments on this story, get back to us on 0705579994 [WhatsApp line], 0779411734 & 041 4674611 or email us at mulengeranews@gmail.com).
