Uganda to sue Kenya over dairy market

Feb 12, 2021

Before the ban, Uganda was shipping close to 450,000 litres of milk to Kenya

Trade minister Amelia Kyambadde.

By Nicholas Wassajja and Moses Mulondo
Journalists @New Vision

The government has said it is not ruling out dragging Kenya to the East African Community Court of Justice over continued trade blockades of many of its farm products, including a ban on dairy products.

The state minister for East African Affairs, Julius Maganda, said although they are still weighing other diplomatic options to resolve the bickering over milk exports, if the deadlock continues, “We shall not waver going to court over the matter.”

“We have requested the Attorney General (AG) to put the matter to the community’s business council as we wait for what will come out of the summit scheduled for February 26 and 27 but if all options fail, we are considering going to court,” Maganda said.

Uganda and Kenya have for over three years, bickered over the export of dairy, poultry, and sugar products with Nairobi announcing in January last year that it will not allow cheap milk from Uganda on its market.

According to the Uganda Manufacturers Association (UMA), Uganda had, before the ban, be shipping close to 450,000 litres of milk to Kenya.

However, by December last year, Uganda was counting losses to a tune of sh1.7 trillion on account of the trade war with Kenya, risking the livelihoods of more than 100,000 farmers, especially in the dairy, poultry, and sugar sub-sectors.

Kenya’s decision is based on claims about the origin of Uganda’s products, despite holding valid certificates of origin and counterfeiting even in cases where products bear a standard mark issued by the Uganda National Bureau of Standards.

Earlier, trade minister Amelia Kyambadde, had told Parliament that all efforts at the ministerial and Head of State level have been made to resolve the impasse, but with very minimal success.

“Kenya has continued to breach commitments it has made,” Kyambadde said while Uganda is emphatic on complying with the East African Community common market protocol.

Speaker Rebecca Kadaga said: “I am surprised that our people continue to suffer, but we do not reciprocate.

“Kenyan authorities protect its farmers, but who protects ours, and yet we have been attracting investors on account of accessing the EAC market.”

Bugiri Municipality MP Asuman Basalirwa advised that if all options to resolve the impasse have failed, Uganda should consider going to court.

“The impasse should be treated as a dispute and should be handled with the aggression it deserves because this is business and we are bound to protect our people,” Basalirwa said.

In January last year, the Government issued a protest note regarding the unfair treatment Ugandan manufacturers have been subjected to but is yet to receive a response in that direction.

Although Kenya insists on Uganda exporting substandard products, Kyambadde said local manufacturers have been issued certificates of conformity by, among others, the Kenyan ministry of agriculture, Kenya Dairy Board, Kenya Bureau of Standards, and Kenya Revenue Authority.

“They said Pearl Dairies was importing milk products to produce Lato Milk, but we formed a joint verification team which found the allegations are not true but to date, we have never got the report,” Kyambadde said.

Uganda also issued a rare diplomatic protest note following incidents of Kenyan authorities raiding Pearl Diaries’ warehouses, but the move was in vain.

But despite the distortions against Uganda, the country’s exports to Kenya have been increasing since 2017, with now recording trade surplus with Kenya.

However, Manjiya County MP John Baptist Nambehse said: “Ugandan farmers and producers are suffering on account of the rivalry between Pearl Diaries and Brookside Diaries of Kenya in which President Uhuru Kenyatta’s family has a stake and which President Museveni is the biggest raw milk supplier.

“EAC has a treaty that is up down therefore, its people are at the mercy of the leaders and if they decide, they can end this impasse.”

Maganda, however, explained that although President Museveni has equal rights like all Ugandans to do business, “he is on record as the biggest supporter of investment and farming; therefore, it's foul to paint him as the impediment to the people that he fights for”.

In a recent interview with the New Vision, UMA executive director Daniel Birungi said farm gate prices for milk are hitting an all-time low while sugarcane rots away in the fields.

MPs say

Parliamentarians are unhappy that Kenya has over the last three years blocked Ugandan-made exports into their country, adding that it is unfair for Kenya to continue blocking Ugandan products yet Uganda acts as a supermarket for Kenyan-made products.

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