Museveni asks investors to use local raw materials

By David Mugabe

President Yoweri Museveni on Tuesday opened a new multi-billion Coca-Cola plant unit, emphasising the need for investors in the processing industry to use locally made raw materials as a way of helping the country retain value lost in billions of shillings.

Opening the soft drinks giant expanded $26.7m new production plant at Namanve, Museveni said Uganda has good agriculture seeds that mature in 18 months and the only thing left is to plan for sustained production capacity.

“Rather than importing pulp from Kenya or bringing in concentrate from outside, this is the one issue I want to insist on because it benefits everybody,” said Museveni.

He said Coca-Cola and other agro-processing firms stand to benefit because “a person who has sold mangoes has got more money to buy more Coca-Cola.”

“This is not just for the benefit of Uganda, vertical integration is in everyone’s interest,” said Museveni.

He hailed Coca-Cola for investing in Uganda and helping the industrial sector, which he said had got into problems during Idi Amin’s regime. Uganda is now in the top 10 market for Coca-Cola in sub-Saharan Africa.

“These people came here because they had faith in the economy,” said Museveni.

Speaking of the promise of Africa, Museveni said the continent currently has one billion people, a figure expected to rise to three billion by 2077.

“Anybody with a vision cannot fail to invest here. This is good business, there is no regret,” Museveni said.

With several opportunities to sell its unique agriculture products, sometimes the country has lost deals for failure to consistently maintain a steady production and supply chain.

Museveni promised to look into the excise tax, which he referred to as “not good to tax production.”

“Excise duty is on the production side. Even with consumer tax, you should be careful (lest you discourage consumption),” said Museveni.

He told workers of Coca-Cola to guard the factory because it belongs to them and not just investors.

Kelvin Balogun, the Coca-Cola president for East, Central and West Africa, said the soft drinks giant has invested about $6b into the continent, with about $200m into Uganda.

Coca-Cola’s inroad into Uganda is the typical emerging trend of global brands such as Google and Microsoft turning their heads to Africa’s changing fortunes.

Coca-Cola will invest $12b in Africa by 2020, according to Balogun.

A burgeoning population and rising middle-class present an increasing spending consumer power and present huge opportunities for growth and expansion in a continent still bustling with natural resource.

There is now an unprecedented interest on the continent and Uganda is clawing its fair share with, for instance, Coca-Cola now employing over 1,000 people directly, another 1,500 indirectly with overall investment of $200m since 1995.

The new plant will bring Coca-Cola’s overall production to 30 million cases (crates) annually. According to Coca-Cola Uganda managing director Norton Kingwill, the new lines will make water, juice and soda.

Coca-Cola earns over $100m in turnover annually.

The overall size of the plant will be almost three quarters of the one in Tanzania.