Teso Sub-region’s Shift to Orange and Mango Farming
In 1995, Teso Sub-region transitioned from a cow-based economy to orange and mango cultivation with support from the National Agricultural Research Organisation (NARO), following persistent raids.
Government’s Privatization Plan for Soroti Fruit Factory Raises Concerns
The government’s plan to privatize the Soroti Fruit Factory has sparked a mixed response from stakeholders. Some welcome this move, while others fear the return of privatization policies that had negative effects in the past.
Challenges Faced by Soroti Fruit Factory
Soroti Fruit Factory has faced difficulties in purchasing fruit from local farmers, despite promises to the contrary. Since its inception in 2019, the factory has struggled to benefit farmers due to its limited fruit absorption capacity. In 2022, it managed to buy only 500,000kgs of oranges and 200,000kgs of mangoes, a small fraction of the estimated 8 million fruit trees in the region.
Government’s Plan to Privatize Soroti Fruit Factory
On September 20, State Minister for Teso Affairs, Kenneth Obote Ongalo, announced that the government is searching for a private entity to take over the $14 million factory, which has been incurring annual losses despite continued investments of approximately Shs5 billion.
Mixed Reactions to Privatization
Farmers, represented by Mr. Simon Opeded of Teso Tropical Fruit Growers Cooperative Union (TETFGCU), believe that the factory’s challenges began when it was commissioned, citing the machinery’s inadequate capacity. They emphasized that the figure of 8 million trees was determined by the Uganda Development Corporation (UDC), not the farmers, and that the government allocated 80 percent of the shares to UDC, leaving only 20 percent for TETFGCU.
A Divided Perspective on Privatization
Some, like Mr. Vans Omome of Iteso Cultural Union (ICU), are cautiously optimistic about privatization, hoping it might benefit farmers who have yet to see the factory’s promised benefits. Others expressed concerns about the factory’s inability to achieve a monopoly in selling concentrates to other beverage companies.
Ongoing Discussions on Privatization
High-level discussions between UDC, the Ministries of Finance and Trade, and TETFGCU are ongoing regarding the privatization plan. The fate of farmers’ shares remains uncertain as these discussions progress.
Financial Challenges and Future Prospects
Soroti Fruit Factory, currently financially strained, faces competition from cheap concentrates in the market. To secure its future, it aims to secure working capital for extensive research and explore high-demand markets locally and internationally.
Parliamentary Consideration
Teso Parliamentary Group (TPG) hopes to present the factory’s privatization plan to Parliament for further deliberation. UDC, the majority shareholder, is expected to provide more insights on the sale.