Uganda approves US$28.8M supplementary budget to mechanize Atiak Sugar Factory 

UGANDA – Uganda has approved a supplementary budget of Shs108 billion to facilitate the mechanization of the Atiak Sugar factory through the Uganda Development Corporation (UDC) in the financial year 2022/23.  

The move aims to revitalize the factory, boost production, and stimulate economic growth in the Acholi sub-region. 

The Atiak Sugar Factory, in which the government owns a 40 percent stake through UDC, is set to undergo a transformation with the infusion of funds.  

The investment, comprising preference shares, shareholder loans, and lease financing, is expected to streamline operations and increase efficiency. 

Once operational in mid-2025, the sugar factory is projected to employ approximately 1,580 workers, a significant increase from the current workforce of 543

Ahmed Mohamud, the factory’s director for planning and development, highlighted the potential of mechanization to enhance productivity, stating that each machine would require three operators. 

The expansion of the workforce is anticipated to have a ripple effect on the local economy, with secondary industries such as ethanol production, animal feed manufacturing, and dairy farming poised to benefit.  

The increased demand for sugarcane cultivation is expected to generate additional income for farmers and spur commercial farming activities in the region. 

Addressing the challenges that led to the factory’s closure three years ago, Uganda’s Minister for Trade, Industries, and Cooperatives, Francis Mwebesa, expressed optimism about the prospects of Atiak Sugar Factory.  

He emphasized its positive impact on the community, including income growth, employment opportunities, and export promotion. 

The government’s recent investment of Shs109 billion into the factory reflects its commitment to revitalizing the sugar industry and promoting agricultural development in the Acholi sub-region.  

“The re-planned model covered a wide range of components, including factory estate development, farm mechanisation, irrigation, the acquisition of a stone crushing machine, debt financing, the settlement of land lease arrears, working capital,” Mwebesa said. 

Amina Hersi Morghe, CEO of Horyal Investment Ltd, the company behind the Atiak Sugar Factory, lauded the government’s support in addressing production challenges. She emphasized the importance of reducing production costs and increasing yields through mechanization and irrigation. 

While mechanized production may reduce reliance on manual labor, efforts are underway to ensure that neighboring communities continue to benefit from the project. 

Amina outlined plans for diversification, including market linkages and crop production support, to empower local farmers and foster economic development in the area. 

The approval of the supplementary budget marks a significant step towards revitalizing the Atiak Sugar Factory and driving economic growth in the Acholi sub-region.  

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