Brookside lays off half its Ugandan staff due to export restrictions
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UGANDA – Ugandan- based Brookside Dairies one of Eastern Africa’s largest dairy processing companies, has laid off half of its staff following restrictions on export opportunities to the Kenyan market.
The processor whose parent company is Kenya’s Brookside Dairy, said the failure of the Kenyan government to grant export permits for its products had denied it more than 75% of its market.
The company added that the blockades imposed by the Kenya Dairy Board have made it difficult for it to continue to supply Kenya, a major market for its products, at optimum levels
“The company has been trying to mitigate the effects of these adverse developments by trying to grow local sales and also source alternative markets for its products in replacement of the blocked Kenyan market,” Brookside said in a letter addressed to the Commissioner of Labour at the Ministry of Gender, Labour and Social Development, Ms Winnie Mirembe Mugabi.
“Having worked on these initiatives for the last three months, it is apparent that we are unlikely to realize tangible results from the initiatives in the short run. We have also engaged the relevant authorities in Government to intervene but without any success.”
The company added that to continue running the factory, the company have no choice but to scale down all its operations across the entire value chain to match the current level of business which is a paltry 25 per cent of the normal operational volumes.
“Under section 81 of the Employment Act, we would like to take this opportunity to inform you of our decision to lawfully terminate employees whose number exceeds 10 on account of structural reasons. 50 per cent of our staff will regrettably be affected by way of a retrenchment intended to take effect in July 2023,” the letter added.
The company also noted that its sales were made through its network of agents and resellers in the market.
Since 2020, the exports to the Kenyan market averaged 75 per cent of the total milk volumes processed in the company, with 25 per cent being local sales and exports to other countries in the region.
Earlier this year, the Ugandan- based business, filed a petition to the Ugandan Ministry of Trade, industry, and Cooperatives against the move of the Kenya Dairy Board to deny issuing permits for its dairy products in the country.
Brookside Limited, processes and packages long-life milk, cream, butter, yoghurt, ghee, and milk powder in Uganda and the East Africa regional export market.
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