Museveni woos Italians to coffee value addition

President Museveni has rallied Italian investors to his cause of value-addition to coffee by urging them to open factories in the country.

The President made the plea during a meeting at State House, Entebbe on Wednesday with the visiting delegation of the Italian overseas development agency, the Italian Agency for Development Cooperation (IADC) led by its boss, Stefano Gatti.

“We now produce nine million bags of coffee and with irrigation, production will be more. We are moving although slower because of resources but once you come in, we shall move faster,” the President was quoted as saying in a statement issued by State House.

Coffee, according to the UN’s Food and Agricultural Organisation (FAO), is one of the most widely consumed beverages in the world, one of the most traded commodities globally, and one of Uganda’s top forex earners.

In the year ended, Uganda earned $952.2m (about Shs3.5 trillion) from the export of the cash crop, according to the Uganda Coffee Development Authority (UCDA), up from $883m (about Shs3.4 trillion) in 2022.

Italy was ranked as a premium market for Uganda’s coffee beans, according to UCDA, with a market share of 28.9 percent, followed by Germany, Spain, India and Algeria.

The country’s top coffee grades are organic Robusta and Screen 18 fair, which according to UCDA, trade at $2 and two cents or Shs7,000 per kilogramme and $2 and three cents or Shs8,300 per kilogramme, respectively.

President Museveni has variously vented his frustration of failing to actualise value-addition to the coffee on a large scale before it is exported in line with the agro-industrialisation agenda under the National Development Plan.

In 2022, the President and his technocrats at the Ministry of Finance, Planning and Economic Development, threw this entire coffee value chain in turmoil with a plan to create a monopoly—a market situation in which there is only one buyer—over the crop through the shadowy Uganda Vinci Coffee Company Limited (UVCCL), overseen by the controversial Italian investor Enrica Pinetti, who has so far failed to deliver on the much-vaunted specialised hospital project along Entebbe Road.

After this newspaper lifted the lid on the controversial deal in April 2022, which in effect sought to place the coffee sector into the hands of an individual, a parliamentary probe recommended its immediate termination. Several coffee players protested against it as well.

During the Wednesday meeting, Mr Museveni told the Italian delegation that “what we need from Europe is capital, not from the government but from the private sector which needs money in the form of profits. It’s a win-win formula”.

The capital, he said, would come on the base of “a lot of natural resources, adequate labour and a lot of investment opportunities that need to be tapped into.”

The IADC delegation was visiting Kampala as a follow-up to the just concluded Italy-Africa Summit convened by the Italian premier Giorgia Meloni during which her government announced a $6b partnership to strengthen cooperation with Africa. Prime Minister Robinah Nabbanja represented at the summit.

Ambassador Gatti told President Museveni and his technocrats that Uganda is a new priority country for Italy’s development cooperation. 

“Our mission here is to first of all respond to your first priority which is the coffee sector. Uganda is a key coffee country in the world and already we have private companies in Italy that invest in Ugandan coffee,” he said.