Kenya seals off Lato milk depot

Monday January 20 2020

Seized: Boxes of seized Lato Milk that the

Seized: Boxes of seized Lato Milk that the Kenyan authorities claim were smuggled into the country without paying taxes. COURTESY PHOTO  

By Dorothy Nakaweesi

Kenya has sealed off a Lato Milk depot in Kisumu days after Uganda protested against the seizure of 3,000, 25 kilogramme bags of milk imported into the country.
The closure followed a protest from the government of Uganda that demanded the immediate release of seized milk exports and ceasing any hostilities against Ugandan exports into Kenya.

In a telephone interview at the weekend, Mr Bijoy Varghese, the Pearl Dairy general manager, which produces Lato Milk, told Daily Monitor the Kenya authorities had continued with the seizures without providing sufficient explanation.

“You see the Kenya authorities have continued to do what they were doing [seizures].
Unfortunately, we don’t know why this is happening,” he said, confirming that the depot in Kisumu had been sealed off and nobody had been allowed to access the premises.

By press time the depot had remained under lock and no details had been provided by the Kenyan government.

January 15 protest note
Daily Monitor was not yet aware if Kenya had replied to the January 15 protest note but sources that requested anonymity to speak freely, said there were ongoing discussions between President Museveni and his Kenyan counterpart Uhuru Kenyatta, to importantly, address the milk seizures as well as other trade issues in the region.
At the start of January, the Kenyan Directorate of Criminal Investigations and the Kenya Bureau of Standards seized three consignments of Lato-branded milk on claims that the products had been smuggled in the country.

However, in a statement about two weeks ago, Mr Amit Sagar, the Pearl Dairy chief executive officer, told Daily Monitor that they were willing to provide the Kenyan authorities with all the necessary documents to prove that the milk had not been smuggled into the country.

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“We are cooperating with all government agencies to provide the necessary documents to put to an end to false reports circulating,” he said, noting that the milk that had been confiscated was a genuine export fully manufactured in Uganda.

He also refuted claims that the company was importing milk products that are rebranded and later re-exported to the Kenya market.

“100 per cent of our milk is produced and processed in Uganda. We do not reconstitute any milk powder to make our UHT milk products,” he said recently.

In a protest note delivered by Trade Minister Amelia Kyambadde and Foreign Affairs State Minister Okello Oryem, government expressed concern over the illegal seizure of Ugandan-made milk and milk products under the Lato brand, saying the seizures, executed on three separate occasions, contravene the EAC Customs Union Protocol.

The note also demanded that Kenya immediately releases the seized consignment of Lato milk and “cease any operation specifically targeting Ugandan made milk exports to Kenya”.

At the weekend, Mr Gideon Badagawa, the Private Sector Foundation Uganda executive director, told Daily Monitor that beyond the seizures, the trade war had cost Uganda close to $270,000 (Shs1b) earned from daily milk exports to Kenya.

Pearl Dairy alone, according to Badagawa, exports more than 300,000 litres of milk every day.
Mr Badagawa also noted that it was urgent for the Uganda and Kenya governments to resolve the current impasse to mitigate the losses being suffered by Ugandan milk producers.

“If we wait two or three days [then the losses will be gross]. Already a number of farmers are not selling milk in Mbarara because Lato cannot buy from them. And that is how bad now it has become,” he said, noting the issue should not be escalated to the extent of laying off workers.

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