Namayingo-Uganda-Residents and local leaders in Namayingo district are feeling crushed and disheartened following the sudden suspension of all activities at CN Sugar factory, the first multi-billion establishment in the district.
The factory had become a source of pride for the district and employment for the area residents.
However, their hopes suddenly vanished when the Ministry of Trade, Industry and Cooperatives decided to suspend activities citing regulatory non-compliance by the Indian investor during the startup.
As a result, over 700 construction and sugarcane plantation workers are currently jobless, unable to provide for their families.
“I have been working at the factory for two years. Losing my job feels like running mad since it was the only hope to look after my family. My worry is how to provide for them without a job,” recounts Ronald Kisseka, one of the unemployed factory workers.
For Sarah Nalukenge, a single mother, she is stuck and pondering the next action in vain. “What can I say? I am stuck, and now looking for another job,” she says.
CN Sugar Limited received a certificate of No Objection from the Minister for Trade- Francis Mwebesa in November 2022, granting the company permission to establish its production site.
Surprisingly, the minister, in his letter dated June 17, 2023, reversed the initial decision, citing the shortage of a nucleus estate e shortage of nucleus estate of at least 500 hectares and a network of sugarcane outgrowers as the cause for halting the undertaking.
A nucleus estate refers to a gig farm or factory that acts as the main hub for production. Around this central hub, some other smaller farmers or businesses supply raw materials or parts to the main operation.
This website has established that the minister’s decision was influenced by a joint petition from the different stakeholders, including members from already established factories, opposing the CN sugar factory’s existence.
The said petition indicated that CN Sugar Limited planted only about 300 acres (121 hectares) of sugarcane out of the required 500 hectares of the nucleus estates.
“The purpose of this letter is therefore to advise you to identify an alternative area outside Busoga region where you can acquire substantial land to establish a nucleus estate and submit it to the ministry for consideration,” Mwebesa directed.
According to Rashid Kakungulu, the CN Sugar factory manager, the minister was misguided, basing his decision on rumours without seeking their position.
Kakungulu adds that they have already secured an additional 500 acres of sugarcane outside Namayingo district as part of the nucleus estate. Furthermore, they have purchased 1300 acres to establish another plantation in districts of Busia and Tororo district.
To establish a factory and other related facilities, one must meet certain requirements including having at least two associations. In this case, CN Sugar factory already has Chia Farmer’s Comparative and Nabongo Agricultural Enterprise which meet the requirements.
Chia group with 415 members availed 845 acres and Nabongo with 139 members availed 520 acres for sugarcane growing.
“The company has signed agreements and continues to enter agreements with many out-growers, currently standing at 1000 outgrowers who have already prepared their fields for planting sugarcane, while others have planted sugarcane,” Kakungulu notes.
Still, other documents obtained by this website indicate that CN Sugar Limited acquired a certificate of approval from the National Environment Authority (NEMA) signed by the agency’s Executive Director.
The certificate further confirms that CN Sugar Company followed the appropriate mitigation measures and as a well fulfilled all the conditions for approval.
Others include the district trading license, and a memorandum of understanding (MoU) signed between the factory and the district leadership with ingredients such as improving feeder roads, and periodic light grading.
“Promptly pay the taxes of URA and district levies and obtain the requisite operational licenses thereto, contribute to clean and safe water within the community,” The MoU reads in parts.
Abdullah Latif Kawuta, the District Vice Chairperson, is dismayed by the ministry’s instructions to halt their maiden multi-billion project in the district.
According to Kawuta, the project has already spurred development in the area. For example, he noted, the rental house prices have increased from Ugx50,000 to Ugx100,000 within just one and half years.
“Moreover, idleness and the crime rate among youths has already reduced significantly, as the majority found employment in the sugarcane plantations and at the factory construction sites,” he details.
Residents Speak
Residents of Namayingo express outrage over the ministry’s decision, accusing the ministry of obstructing vital developments in their area. They further argue that the factory development had already begun providing local employment opportunities.
Winnie Nabirye, a resident of Kifuyo, suggests that acts of corruption might have influenced the decision to halt the factory’s construction works.
According to Nabirye, the ministry’s action could discourage other investors from committing resources and capital for other mega projects such as factories or infrastructure.
Meanwhile, another resident and a supplier of hardcore stones at the factory’s construction site, Ibrahim Mukisa told us that he had invested heavily in stocking hardcore to supply the CN sugar construction sites. “My entire investment is now redundant,” he laments.
“The potential job creation opportunities and economic growth that these projects could bring in the area are delayed and missed, yet the poor residents had hopes of improving their livelihoods,” he adds.
Attempts to obtain a comment from Minister Mwebesa regarding his decision have proven unsuccessful. His known mobile numbers remain unanswered.
In the meantime, the Indian Investor has yet to comment on the incident or the future of his investment.
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