Minister summoned over sh13b Uchumi debt
Apr 12, 2017
The officials argued that failure to clear the debt has created impacts in the financial sector by increasing the non-performing loans
Minister of Trade, Industry and Cooperatives, Amelia Kyambadde. Photo/File
A year since Uchumi supermarkets closed operations in Uganda, its creditors have never been paid.
A statement from the Private Sector Foundation Uganda indicates that at the time of closure, the company owed its creditors over sh13b.
"To date, no brief has been issued by the minister on when the creditor will be paid. Its budget time, the ministry of Trade has not even budgeted for it," MPs noted.
The officials argued that failure to clear the debt has created impacts in the financial sector by increasing the non-performing loans and also affecting the stocks of other supermarkets.
"The issue has been brought up to the East African Community level no tangible result has been achieved. Unfortunately, the ministry is silent about this issue and yet it's of great impact to the economy particularly SMEs," the statement adds.
Uchumi supermarkets in October 2015 closed its loss-making Tanzanian and Ugandan businesses as part of a move by the company to turn it round.
This was after the two subsidiaries reportedly failed to make any profit over the last five years. Reports indicated that the operations were instead being supported from the headquarters every month.
When the company closed its Ugandan and Tanzanian outlets, it tried to file for bankruptcy in the Ugandan High Court in a bid to protect its remaining assets from creditors and suppliers.
During the meeting yesterday, the Committee chairperson Kenneth Luboggo said the committee would summon the minister of Trade to appear and explain the matter. "These were business people. The Minister of Trade should explain what is happening," he said.