Kampala. African Potash, a company listed on the London Stock Market, has signed an agreement with Uganda that will see the UK firm establish its presence here to supply affordable fertilisers to farmers in the country, East Africa and beyond.
The Memorandum of Understanding (MoU) signed last week was witnessed by Common Market for Eastern and Southern Africa (Comesa) representatives and the Alliance for Commodity Trade in East and Southern Africa. The two blocs will ensure that quality of fertilisers is up to required standards as agreed in the deal.
The group, which included representatives from the office of Operation Wealth Creation, Agriculture, Finance, Energy and the African Potash chairman, Dr Chris Cleverly, also agreed to work together to increase availability of fertilisers in Uganda by 50 per cent (20,000 tonnes) as well as establishing a nationwide distribution network for fertilisers. And for that, an MoU was signed between the parties - government and African Potash.
During discussions before the signing, it was revealed that the use of fertilisers continues to be low in Uganda because of high prices and poor quality fertilisers on the market.
According to the Economic Policy Research Centre, at least eight in every ten 50-kilogramme inorganic fertiliser bags on the Ugandan market do not meet the required standards.
During the 2016/17 Budget reading in Kampala last week, Finance minister designate Matia Kasaija said for commercial agriculture to take off as well guaranteeing food security, farmers must begin to consider using fertilisers.
“Commercialisation in agriculture has remained low, with only about 119,000 or 2.3 per cent of the 5.2 million farming households engaging in commercial farming. Declining productivity in this sector is, therefore, a major challenge,” he said, adding this has been worsened because of the limited use of fertiliser coupled by low use of high yield seed and animal inputs.
Following discussions in February on the importance of food security in the region and increasing the wealth of small holder farmers in Uganda, there was a meeting with trading director of Comesa, Mr George Magai, to agree how best for African Potash to invest in the fertiliser development in Uganda with the aim of making the country a hub for fertiliser manufacturing and distribution throughout Comesa countries.