Joshua Nahamya
AMURU
The leader of the opposition in parliament (LoP), Joel Ssenyonyi, has asked the government to carry out a thorough audit to establish how Shs 553.71bn that has been injected into Atiak Sugar Factory was utilized.
The recommendation came after the leader of the opposition led a delegation on 17th October, to evaluate the factory’s production capacity, the current operational status, and its economic contribution to Uganda’s economy.
The delegation also wanted to examine the involvement of local farmers and out-grower schemes in the sugar production value chain.
According to Ssenyonyi, they also wanted to assess the accountability and transparency mechanisms in the factory’s operations yet it continues to receive money from the government.
“To identify any operational, financial, or infrastructural challenges faced by the factory and also to review the extent of government support and private-sector partnerships in the development of the factory” reads the report
According to the findings tabled in parliament, Atiak Sugar Factory is currently non-operational for unknown reasons.
“The factory has not produced a drop of sugar since 2022. This raises concerns given government’s intervention over the years” Ssenyonyi said
The management of the factory has also abandoned the earlier model of planting 60,000 acres of sugar cane from Atiak across to Lamwo through farmer cooperatives and instead resorted to planting 25,000 acres of sugarcane in Atiak, owned by the factory.
Despite the factory being non-operational for a couple of years, the report shows that it spends 200 liters of Diesel on a daily basis, running turbines, apparently to prevent the machines from rusting and malfunctioning. This regular expenditure is disturbing given that there is no production going on.
The report also showed that there has been slow delivery of machinery to fast-track mechanization of the factory.
“At the time of the visit, only some of the required equipment had been delivered yet these are also incomplete and without the necessary accessories” Ssenyonyi noted
Despite the heavy financial investment of Ugx 553.71bln by the Government in the joint venture project, Ssenyonyi said that what is on the ground is not commensurate with the kind of investment in Amuru district thus calling upon the government to conduct a comprehensive audit to confirm whether it is not a white elephant project.
“While the company is desirous to receive more money from Government, we think it is prudent for the already invested 553.71bln to be accounted for first,” Ssenyonyi implied
“There must be value for all this money before we think of investing more,” he insisted.
Sssenyonyi added that the Uganda Development Corporation (UDC) has to fast-track the conversion of its preferential shares into ordinary shares to increase its negotiating power, strong decision-making, and voting powers in the company.
The leader of the opposition also encouraged UDC to improve oversight and management of the factory’s operations by ensuring efficient management and transparency in the use of public funds in place.
Earlier this year, President Museveni said he was pleased with the company, and sounded a warning to unnamed political leaders whom he accused of attacking the factory and trying to sabotage the investment.
In reply to Ssenyonyi’s plea, Speaker Anita Among directed: “We will get a response from the Ministry of Finance and the Attorney General in terms of the conversion of the shares and accountability of the money that has been given.”
The State Minister for Finance in charge of General Duties, Henry Musasizi, said: “We take note of the Leader of the Opposition’s concerns and we undertake to respond in writing.”
He added that it would be tabled “within two weeks.”
Background
Atiak sugar factory, owned by Horyal Investments Holding Company Limited, was founded in 2013 and officially launched in 2020 but ran into financial challenges after failing to pay off its debts.
Its owners then sought a financial bailout from the government, and between 2017 and to date, with the open backing of President Museveni, has received more than half a trillion in taxpayers’ money.
According to the proprietors of the company, the investment was strategic in promoting the welfare of citizens in the once war-ravaged northern Uganda, and particularly promoting women empowerment. In return, the government acquired preferential shares in the company.
When the machines at the factory first started roaring over a decade ago, its senior management pledged to turn the venture into “an engine for development to support the livelihoods of vulnerable populations”.
The capacity of the plant in Phase One was targeted at 1,650 TCD (Tonnes of Cane crushed per Day), to be expandable to 3,500 TDC in Phase Two, and 5,000 TCD in Phase Three.
More than a decade since its inception in 2013, Atiak Sugar Factory continues to polarize Uganda with no intended benefits accrued such as revitalization of Northern Uganda’s economy, promoting agro-industrialization, and creating jobs.
One may ask how many times will the government continue losing the taxpayers’ money through Public-private partnership projects such as the sericulture project in Sheema where Ugx 57bln was sunk, then the presidential initiative on banana industrial development (PIBID) in Bushenyi where over 400bln has been invested but the returns are incomparable, let it be in the agriculture value chain, electricity, mining, and mineral development among others. Could this be a new trend of illicit financial flows going on within the country that could be investigated further?
