Uganda has received a grant of sh16 billion to boost exports of coffee and cocoa to the European Union and other global markets. Finance minister Matia Kasaija and the EU head of delegation Attilio Pacifici signed the financing grant agreement this morning in Kampala.
The grant for a project known as the European Union-East African Community Market Access, or MARKUP, is part of a 150 billion Shillings regional project aimed at strengthening the value chain and EU market access for strategic export oriented crops.
The crops are coffee, cocoa, tea, horticulture, spices, avocado and peas. In the case of Uganda, coffee and cocoa have been selected because of the country’s comparative advantages in the two cops. Coffee is Uganda’s biggest crop export.
According to Ambassador Pacifici, Uganda’s coffee exports to the EU are worth 1.3 trillion Shillings, constituting 60 percent of total exports. On the other hand, cocoa export to the EU is worth 153 billion shillings with great potential of growing further.
The new project now intends to increase access of Ugandan coffee and cocoa to the EU market by strengthening the supply side including the value chain, value addition and role of the private sector. The project will be implemented by the various line ministries and agencies like the Uganda Coffee Development Authority.
Ambassador Pacifici said coffee and cocoa have been selected because they are key to Uganda’s development agenda.
Ambassador Pacifici emphasized that the focus is on enhancing the capacity of the private sector to boost exports of the two crops.
Challenged on how they will ensure the benefits cascade to boost the private sector in marginalized coffee and cocoa producing areas like Nebbi and Zombo instead of focusing on particular areas, Pacifici said the priority is to boost market access first.
Finance minister Kasaija said the grant will support small and medium enterprises to gain access to the EU market.
Kasaija added that through the grant, the government will be able to implement a range of efficiency measures to reduce trade barriers and provide quality assurance, enhancement of SME export competitiveness and business promotion.
The managing director of UCDA, Emmanuel Iyamulemye Niyibigira said the grant will be properly utilized in order to get the best results.