Uganda Plans 10b Citrus fruit factory in Teso Region

Tuesday February 1, 2011

AMID growing fears that a fruit factory in Teso sub-region will never be constructed, the Government is moving closer to fulfilling the pledge it made in 2008.

“We have completed many invisible tasks and I want to assure farmers in Teso that the fruit facility will be in place in 2011,” says Prof. Arsene Balihuta, the executive chairman of the Uganda Development Cooperative (UDC).

Speaking to New Vision recently, Balihuta said with the revival of UDC as a development arm of government in 2008, his first assignment was to work with a team of experts from other government agencies to establish the factory in the region.

The agencies included the National Agricultural Advisory Service, the Uganda Industrial Research Institute, the National Agricultural Research Organisation, Uganda Investments Authority and the finance ministry.
The heads of the agencies last year met in Soroti and deliberated on a number of issues, including drawing work plans, time frames and the distribution of roles.

They were also supposed to establish a company to own the facility and engage all stakeholders who had expressed interest in establishing the factory.

Today, Balihuta says great strides have been achieved by the taskforce.
“We have so far mobilised farmers into a coherent body,” he says.

After mobilisation, farmers selected seven members from every sub-county in the region, who later converged in Soroti and selected their representatives in the Teso Tropical Fruit Growers Cooperative Society.

The cooperative was then registered by the trade ministry and in May last year, UDC, together with farmers, agreed to own the factory.

“We have signed articles and memorandum of association to own the factory. UDC, on behalf of the Government, will own 80% shares, the farmers 20% and the percentage for the private sector, which will be procured through an international bidding process, will be discussed at a later stage,” he explained.

The proposed location for the factory is the Uganda Investment Authority’s industrial park in Arapai sub-county in Soroti district.

The plot, initially occupied by squatters, has so far been surveyed and waits to be serviced with water, electricity and other utilities.
Balihuta says are now in the process of procuring a consultant to conduct feasibility and environment impact assessment studies.

“The studies will guide us on the technology and the machinery, the required land and production capacity to sustain the factory,” says Balihuta.

“We shall then procure architectural drawings and then contact firms for provision of the machinery for the facilities,” he noted.

Balihuta says they plan to establish a fruit factory, cold chain for the fruits, houses for the staff and a laboratory on the premises.

“This is our plan but we haven’t yet identified a suitable private partner with expertise in fruit processing,” he says.

He said the private partner will be required to provide additional resources to complete the assignment.
The Government in 2009 set aside sh5b for the fruit factory, but the taskforce estimates that the entire process could cost about sh10b.

Balihuta says a private partner will be required to provide the additional resources.

He also noted that for sustainability of the fruit factory, another investor has to be sourced to help with irrigation to increase fruit production in Odina and Labori on the shores of Lake Kyoga.

The farm, according to Balihuta, has 900 hectares, and once developed, will act as a nucleus farm for the factory.

Balihuta disclosed that Koreans had expressed interest in constructing the factory and other assorted facilities.

Why a fruit factory in Teso sub-region?
A fruit factory in the region would be good news for the people of Teso, who grow plenty of mangoes, oranges and other tropical fruits but have no viable market for them.

During the mango season, much of the fruit rots in the gardens.

Those who take the fruits to the local markets are often paid very little money for them, which discourages the trade.

When President Yoweri Museveni toured Teso in 2008, he pledged that a fruit factory would be established in the region.

The President was optimistic that within two years, farmers’ lives would be changed for the better.

There are already about two million citrus trees in the region. It was estimated that by the end of 2011, the number would have risen to about five million trees.

Tito Okello, a prominent fruit grower in Soroti district, said: “I have over 500 trees. Every season, I earn about sh10m. If the factory is established, it will enhance our earning,” he says.

“Time will tell if the factory is an effort to alleviate poverty or merely a tool for political campaigning ahead of the general elections,” he adds.

By Ronald Kalyango: The New Vision Newspaper