ROGERS WADADA: Who owns the coffee for which the Government signed a controversial Agreement?

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Roger Wadada Musaalo, is a Lawyer, human rights activist, researcher, and politician (PHOTO/File).

A few months ago, I received a dossier warning me to put a lid on my pen and mute, for I was accused of writing articles deemed to be critical by a section of untouchables.

Indeed I took the threat serious and stopped writing. However, when the coffee saga rose up, I asked myself a number of questions with no answers.

I took a painful decision and rose from my early retirement for the sake of my people from the mountains of the sun- Bugisu and picked a pen to do what I do best for my leisure, writing about a range of issues affecting society.

When the signing of the controversial coffee agreements with Italians came to the public domain, the first to react was the Chairman Bugisu Cooperative Union followed by coffee farmers, coffee dealers and the katikiro of Buganda.

Their concerns centered around a controversial coffee agreement signed on 10th February, 2022 by the Minister of Finance and the Uganda Vinci Coffee Company Limited without consulting the stakeholders in the coffee business.

The rush to monopolize the Uganda coffee market seems to have been influenced by the 2021 report which indicated that Uganda is the 8th largest coffee producer in the world and is on course to overtake its competitors in the next 10 years if all factors remain constant.

While signing the coffee agreement, it appears the Government had forgotten that it does not own a single coffee plant from which coffee is picked before being sold.

It therefore goes without saying that the Government had no authority to sign an agreement committing to give exclusive right to a private company to enjoy the monopoly of buying coffee.

We know that in the last 10 years, the Government of Uganda through NAADS and Operation wealth creation gave out coffee seedlings to coffee farmers but it was not in exchange for taking over the coffee business and dictating to whom the coffee was to be sold at what price.

The purpose of giving out free coffee was partly a campaign strategy but also to create wealth for the farmers.

No wonder in the last financial year, Uganda saw a record growth in coffee exports earning rise to about US$629.8 million and with a projected target of exporting atleast 20 million bags for the financial 2021-2022. That was the dream of UCDA’s Managing Director Emmanuel Iyamulemyein in a statement issued late last year.

One of the laughable clauses in the agreement was that Vinci coffee company would retains the exclusive right to buy all Uganda’s coffee meaning that no one else would be allowed to export any coffee outside Uganda.

The only open option according to the agreement was to sale the coffee to Vinci against all odds. The framers of this agreement endorsed by the Attorney General seem to have forgotten that coffee is grown by private farmers with all rights to deal with their coffee as they wished including cutting down all the coffee plants in protest of the Government’s unfair decision, after we live in liberalized times.

The coffee hullabaloo began with the Government of Uganda withdrawing from the International Coffee Organization (ICO) and effectively terminated the International Coffee Agreement 2007.

The timing of the termination almost 15 years later is questionable and it appears the ICO agreement had been viewed as an obstacle to the sinister plans to bring a new player into the picture. Of all companies in the world, the Government chose to introduce a company owned by Pinetti whose questionable investment reputation remains controversial even outside Uganda.

It would be wrong to push the blame to the Minister of Finance Matia Kasaijja or his Permanent Secretary, their decisions must have been influenced by the executive and by collective responsibility, we know who is operating behind the curtains.

Now the Speaker of Parliament has directed the Parliamentary Committee on Trade, Tourism and Industry to take action by inviting the signatories to the controversial agreement to appear before the committee and answer some questions.

According to the Speaker, the purpose of the probe is to investigate the controversy for public confidence. Surely Parliament can do better than that, they have an oversight obligation under the law and cannot probe such a serious matter for the sake of public confidence.

There are more serious issues to address such as the criteria used to determine tax exemption and above all, the “ghost” mafias who own the Vinci Company behind the shadows of the Italians who have failed their first test of building the Lubowa Specialized hospital.

Earlier this year, the Uganda Coffee Development Authority (UCDA) informed the public that they had quit the International Coffee Organisation and outlined seven reasons for terminating the international agreement.

They cited unfair tariffs, restrictions on exporting processed coffee and an “unjust and outdated” coffee classification system. They also alleged that there were unbalanced tariffs as an ongoing concern in the global coffee market among others.

They relied on a 2020 report finding showing that processed coffee imported to Uganda was subject to a 60% tariff while other countries, including European Union, Norway and Japan pay low or zero rates.

However, the argument of UCDA fell short of disclosing that these countries’ tariffs were under the jurisdiction of the World Trade Organisation which creates tax exemptions and subsidies for its members.

I personally agree that the ICO agreements were unfair to Uganda in so far as there was discrimination but I am also aware that this agreement had been signed with a free will.

For instance, there were barriers to exporting “value-added” processed products meaning that we would export the beans cheaply and in return import expensive refined coffee from the capitalists who have continued taking advantage of Uganda for their own selfish ends.

I strongly believe exiting the International Coffee Organisation was not the best option without understanding the dynamics and raising a red flag to push for some amendments.

The Uganda Coffee Development Authority should have opted to negotiate for better terms instead of an outright termination. It is apparent that the UCDA had been coached to clear the ground so as to bring the broke Uganda Vinci Coffee Company Limited on board.

However, the deal has met wide resistance with some in Government denying taking any part in the agreement. The first was the Solicitor General, followed by the Minister of Agriculture, coffee farmers, Uganda Coffee Farmers Federation, regulators and cooperative unions.

It is embarrassing that the Attorney general endorsed the coffee agreement in total disregard to Section 52 of the National Coffee Act, 2021 which enjoins the Uganda Coffee Development Authority to establish a coffee auction system to be used as an alternative method to the day-to-day method of selling coffee. The spirit behind the provision was to potentially add value in the distribution system and create a closer link between growers and roasters.

The system under the law was designed to create avenues where Uganda’s coffee should be traded and no such decision can be taken without consulting all the stake holders.

Now that there is no evidence of the participation of the Uganda Coffee Development Authority and the stakeholders, the coffee agreement is a non starter and divisionary.

Whereas the Attorney General confirmed played a part in the agreement, it fell short of Section 29 of the interpretation Act which empowers the Solicitor General to review and clear contracts without contradicting Article 119 of the constitution of the republic of Uganda.

When all is said and done, there is no need for the fuss, that agreement is only political; it will not survive the test of time so I say.

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