The Uganda Flowers Export Association has warned that the flower sector may not normalise until 2021, if measures are not taken to mitigate the losses as a result of coronavirus.
Ms Esther Nekambi, the executive director of UFEA (Uganda Flowers Export Association), while speaking to the Daily Monitor yesterday said, “All exporting flower farms have laid off approximately 30 per cent of their workforce due to the inability to sustain salary payments during this pandemic. The floriculture sector has reached a near total collapse, seeing a drop of 90 per cent in the industry’s exports and 50 per cent drop-in price rate.”
According to Ms Nekambi, COVID-19 is heavily affecting the horticulture industry.
She says if there is no intervention, about 10,000 to 15,000 people will be jobless, taxes will be affected and foreign currency worth $84.98m incoming to the economy will be lost.
“There are disruptions in supply chain, as aircrafts to take the perishable produce have stopped coming to Uganda and cargo companies have suspended flights. Also, buyers have cancelled the contracts due to government’s closure of restaurants, coffee shops. Consumers are tending to purchase necessity goods and avoiding the purchase of luxury goods such as fresh cut flowers. The remaining markets are stuck with an oversupply hence prices have crashed thus making it economically unviable to ship,” she added.
In 2018, Uganda exported 7,500 metric tonnes worth $55m (Shs202.8b) flowers. The floriculture industry currently employs over 10,000 people directly, who are mostly rural workers, with up to 70 per cent of them women.
UFEA) therefore, requests government to clear outstanding Value Added Tax to support the industry, postpone taxes and look into a tax holiday, Ms Nekambi said.
“Growers are throwing away most of their produce. Inputs must continue including fertiliser and chemicals. But with no incoming revenue, how can the sector keep their plants alive?” she adds.