The Attorney-General and Finance Minister defend the contentious coffee deal

BY: Eyalama In Business, News On

The Attorney-General, Kiwanuka Kiryowa, and the minister of Finance, Matia Kasaija, have defended the controversial coffee contract between the government and the Italian investor that has ruffled feathers since last month.

While appearing before the parliamentary Committee on Tourism, Trade and Industry, the Attorney-General told the committee that the contract is legal and binding.

“I checked the company’s legal standing and I was convinced that the company has proper legal standing in Uganda, therefore the contract has no breach of any provisions of the law. So, I confirm that I carried out legal due diligence on the company and I am convinced it is in compliance with the provisions and any of the laws,” Kiwanuka said.

In February 2022, Kasaija, on behalf of the government, signed an agreement with Uganda Vinci Coffee Company Limited (UVCC) owned by an Italian investor, Enrica Pinetti, to have exclusive rights to buy Uganda’s coffee for processing.

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This was on top of several incentives and concessions extended to the same coffee company that, among others include: allocation of 27 acres of land at the Industrial Park in Namanve; construction of an access road linking the plant to the main access road and power transmission to the plant at Government’s cost; and exemption from all kinds of taxes.

Kasaija allayed MPs’ fears that the contract favours the coffee company at the expense of local farmers. He insisted that the UVCC deal is beneficial to Ugandans.

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“This agreement does not deter other potential investors from investing in value addition; UVCC provides an opportunity for the country to fetch better prices for high grade coffee. The company aims to establish several hubs across the country intended to enhance traceability of farmers and to eliminate middlemen,” Kasaija said, adding that UVCC will pay a competitive and market determined price.

Bwamba County MP, Richard Gafabusa, questioned why the government did not consult widely before signing the controversial coffee contract. He also wondered why there was no termination clause in the contract that was signed with UVCC.

“Enrica acquired the deal to get the land but over the years nothing has been done. Over 10 years have gone by and the deal has just been finalised this year. This makes the previous years null and void. Is there any clause that calls for termination in case the investor fails to deliver?” Gafabusa asked.

The trade committee is still sceptical about the coffee deal as there are significant documents that are still missing and questionable.

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