Emirati firm Elite Agro eyes investment in Uganda’s tea sector with establishment of processing plant

UGANDA – The government of Uganda through the Ministry of Agriculture, Animal Industry and Fisheries has signed a memorandum of understanding (MOU) with UAE-based Elite Agro LLC (EAG) to explore potential business opportunities in the country’s tea sector.

Elite Agro is one of the leading producers and distributors of fresh vegetables and fruits in the Middle East and engages in growing, sourcing, importing and marketing a wide range of high-quality produces through world-class technology and effective distribution chain.

Key among the opportunities of the MOU is to set up a tea processing factory in Uganda and facilitate trade of the commodity between the UAE and Uganda or other destinations.

The MoU follows Uganda’s successful participation in the recent Dubai Expo and it was inked by Maj Gen. David Kasura-Kyomukama, the ministry’s Permanent Secretary and Elite Agro’s Deputy CEO and Board Member Dr. Abdulmonem Almarzoogi.

It was witnessed by Uganda’s Ambassador to UAE Mr. Zaake W. Kibedi and the Elite Agro Business Development Director (Agriculture), Mr. Chandra P. Singh. The Board Chairman for Elite Agro presided over the function.

Maj Gen. Kasura-Kyomukama commended the partnership noting that this is part of the ministry’s mandate to offer possibilities for prospective business opportunities in Uganda’s tea sector, reports Business Focus.

The next step for both parties is to do a feasibility study and evaluate various site option for suitability in setting up a tea factory and understand the tactical and the possible areas of future cooperation.

The agreement comes on the heels of the heavily contested deal between the Ministry of Finance and the Ugandan unit of Vinci Coffee Company Limited, to establish a coffee processing plant at the Kampala Industrial and Business Park.

According to reports, the state has been forced to halt the US$80m deal as it has attracted criticism from various players in the sector for failure of the ministry in question to consult relevant stakeholders including its counterpart the Ministry of Agriculture.

To this end, the government has set up a ministerial committee with participation of the Attorney General to review the agreement.

The agreement claims that the state will give Uganda Vinci Coffee Company Limited free land in the Industrial and Business Park at Namanve measuring 27 acres.

It also gave the company exclusive rights to buy all of Uganda’s coffee and its concession will end in 2032 but is subject to renewal.

In addition, the agreement also exempts the Vinci Coffee Company from paying Income tax, Pay As You Earn, Excise duty, and remitting NSSF contributions. The document also provides a 5 percent subsidy on electricity for the company.

The facility to be built is expected to have a processing capacity of 60,000 tonnes of coffee per year but will start with 27,000 tonnes.

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