Minister Kasaija (2nd L) with investor Enrica Pinetti (left) after signing the agreement. Looking on (2nd Right) is Ramathan Ggoobi, PS, Ministry of Finance
The controversial coffee agreement signed between Government and Italian Investor Enrica Pinetti is ‘satanic’ and should be cancelled in order to protect Ugandan coffee farmers, a section of MPs, have said.
Mityana South MP, Richard Lumu made the remarks while appearing alongside some opposition MPs who petitioned Parliament’s Trade, Tourism and Industries Committee to investigate the controversial coffee deal.
“I actually don’t know whether when they were drawing this agreement, there was an advocate. I don’t think so, because they say they are going to give Ugandans 246 jobs (but) there is no description,” Lumu said, adding: “We don’t know whether sweeping, we don’t know. When you read this agreement, you simply get sick. This is why I called this agreement satanic.”
The Trade Committee was shocked to learn that the agreement whose negotiations started in 2014 didn’t provide for any clause of termination on the side of Government, contrary to reports by Ministry of Finance that the agreement is enforceable for 10 years up to 2023.
“This agreement has gotten no termination clause which is a weird thing, we have to be in it or not. Now they went to forth majeure and they said if there are issues, the company is at liberty to cancel, not Uganda,” revealed Lumu.
The lead petitioner Kimaanya-Kabonera Division MP, Abed Bwanika, tasked Government to explain whose coffee it had committed to the US$80M Uganda Vinci Coffee Company since the farmers who are the main growers of coffee weren’t consulted before the deal was signed on their behalf.
“Coffee in Uganda is a property of farmers, government doesn’t own coffee. How can government which doesn’t own coffee make an agreement to commit the coffee of the people of Uganda when the farmers aren’t involved in that agreement? They were not consulted, they weren’t aware,” Bwanika said, adding: “I don’t know of any coffee plantation owned by Government. So which coffee did government commit? Is it the coffee of people of Ugandan or the one owned by Government?”
Bwanika also protested the proposal to commit 3-6% of the best coffee in Uganda to Vinci, describing this as a monopoly that is geared towards frustrating the coffee farmers in Uganda and disadvantage other processors.
During the probe, it was revealed that Government has already spent Shs17Bn in clearing the 27acres of land that was gifted to Pinetti in Namanve Industrial Park.
“I have never seen a company that gets advantages like Vinci. It gets 27acres of prime land, free without paying anything, what is annoying is that the government undertakes to make the land habitable. They even went on to grade the land for the company and in this agreement, Shs17Bn was spent to make the land habitable. I don’t know what they are telling us that they are going to protect local content when this one is getting everything free,” said Lumu.
Joyce Bagala (Mityana DWR) tasked both Government and Vinci Coffee factory to provide Parliament with the feasibility study that was undertaken on the investor as proof of having done work elsewhere and why the need for exclusive rights over coffee yet Uganda is operating a liberalized economy.
“We would like to know if there was feasibility study carried out and can they share the study. Does it make any economic sense than the high quality? Why the need for exclusive rights in a liberalized economy, what has been done so far since 2014 when these negotiations started” Have you experience of doing this business anywhere and how successful was it?” asked Bagala.
Meanwhile, the Committee was forced to adjourn after Moses Matovu, Company Secretary informed the Committee that Pinetti had snubbed the Committee summons because she was away at State House after being summoned by President Museveni.
In a related development, President Museveni has summoned NRM Caucus meeting at Kololo Independence Grounds tomorrow and top of the agenda is discussion on the controversial coffee deal and the Lubowa hospital construction.
To terminate the contract,the government has to compensate the Italian investor.