National Coffee Bill 2018:Is it good law or bad law?

Thursday July 11 2019

 

By Karoli Ssemogerere

Agriculture Vincent B. Sempijja has presented the National Coffee Bill before Parliament to repeal and replace the Uganda Coffee Development Authority Cap 325.

The Bill covers the general outline of a production and trading, administrative and financial measures. It is a timid Bill. These measures fall far short of what is required to sustain the coffee industry.

Between 1968 and its demise, the Coffee Marketing Board was one of Uganda’s most powerful institutions processing and trading in Fair Average Quality Coffee. Coffee Marketing Board had a domestic process producing two distinct coffees, Inferior and Superior for the local market (Inferior was a robusta blend and Superior was an Arabica blend.

What killed Coffee Marketing Board (CMB) was the siphoning of its profits by its militarisation under President Apollo Milton Obote to pay off war debts. President Obote installed Maj Gen David Oyite Ojok, his chief of staff, as chairman of CMB.

A well thought out coffee rescue plan comprising of rehabilitation of coffee bushes in central Uganda partly failed due to the war conditions, but also due to failure to reinvest profits from coffee sales in the coffee industry.

Cooperatives, another mobilisation resource covering the whole country struggled during the Obote regime, but were alive and limping on until another catastrophe hit the coffee industry. The collapse of both UCB and Cooperative Bank in rapid succession that dried up crop finance that used to shield farmers from price volatility. Each year, the Minister of Finance would commit “crop finance” to these institutions for unions to purchase dry cherries kibooko from farmers. Of course, politics intervened, and crop finance became entandikwa and political goodies and the rest is history.

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In 1990, Uganda registered a massive coffee windfall from frosty conditions in Brazil, the world’s largest coffee producer. Uganda earned $1 billion in coffee that year up from the average of $400 million average, President Museveni and NRM found in 1986. Actually, coffee receipts in real terms have been falling due to inflation and they are yet to hit $600 million today.

Government came up with a clever idea to “borrow” this windfall and set up a stabilisation fund to save it. The windfall was quickly forgotten and with coffee prices shortly after hitting the doldrums, the promising decade of the 1990s collapsed when both UCB and Cooperative Bank closed.

In the early 2000s, the attitude of Washington towards the coffee sector was near hostility. Preoccupied with other failed programmess like privatisation, the State was up for sale. A lot of coffee infrastructure simply rotted in warehouses. Some machines are still in stores. Ministers requisitioned public goods in the form of wet processing mills for personal use. Farmers tired of being abused uprooted coffee.

The mid-decade came with the relentless coffee wilt disease that wiped out many trees. Production plummeted until government took a bold step to plant coffee again. Discussing Naads is another topic for a full day, but reducing the age of the coffee bushes has added another 50 years of productivity to the coffee sector.

However, the Bill’s silence on the key areas, price stability through a stabilisation fund, revival of cooperatives as a marketing tool for coffee risks turning UCDA into a bigger white elephant. The current Bill relies on stakeholder/agency implementation rather than administrative principles. UCDA countrywide is running out of kiosks with little connection with the grassroots.

Naads has jettisoned most of its development budget without the technical resources to fight new threats such as climate change and the coffee berry borer.

Lastly, the farmers play only a minute role in the entire UCDA. Just two coffee farmers out of a board of more than 15 members! This is ridiculous. UCDA from its early days, has been hampered by this problem. It is supposed to serve farmers, but has never appointed a farmer to head it.
Mr Ssemogerere is an Attorney-at-Law and an Advocate.
kssemoge@gmail.com