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A truck transporting sugar cane to the factory. File photo
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The ministry of trade, industry, and co-operatives has revoked operations at CN sugar limited plant, whose construction was underway at Kifuyo village, Buyinja sub-county, Namayingo district a decision that is likely to make the project face a bleak future.
On November 9, 2022, the firm was issued a no-objection letter by trade minister Francis Mwebesa after submitting an application seeking clearance for the establishment of a sugar mill on September 30, 2022.
However, the clearance had two conditions: requiring the firm to first establish a nucleus sugarcane estate of at least 500 hectares and ensuring that the network of sugarcane out growers was developed before erecting the sugar plant.
Instead, Mwebesa said the firm only planted 121 hectares (300 acres) of its own sugarcane nucleus estate around the site, contrary to the outlined 500, and proceeded with erecting a mill. Mwebesa, in his June 17, 2024, revocation letter to the Director of CN Sugar Limited, states that his ministry had received a petition from sugar industry stakeholders for implementing activities to erect the sugar mill without necessarily adhering to the set conditions.
He said a verification team that was deployed observed that the firm had only planted 21% of the required acreage of 500 hectares of nucleus sugarcane estate, hence the cancellation of its license.
“The purpose of this letter therefore is to inform you that the initially issued certificate of no objection to set up a sugar mill at Kifuyo village, Buyinja sub-county, is hereby revoked,” reads the letter, which was also copied to the Director General, Uganda Investment Authority.
It also advises the firm to identify an alternative area outside the Busoga region where they could acquire what he termed substantial land for the establishment of a nucleus sugarcane estate.
“This is 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. The inconveniences caused are highly regretted,” it states.
Rashid Kakungulu, the plant manager at CN Sugar, confirmed receipt of the revocation letter, explaining that besides the 300-sugarcane nucleus estate on site, they planted more on 650 acres elsewhere.
He added that they had also acquired 1,300 acres of land in Bugiri, Busia, and Tororo districts, even if they only needed 1,250.
He faulted the verification team for declining to be taken around their other estates and revealed that all together, they had so far injected $12m on top of paying Sh1b in taxes to import materials for the installation of the sugar plant.
“I don’t know what influenced the minister to cancel our license because the progress of our activities was at 40%, some laws were confusing, and where should we take our canes, which are almost mature? Let us hope he is ready to compensate us,” he said.
Following the revocation, locals petitioned Namayingo LCV chairperson Ronald Sanya, saying they had already started reaping from the project even before its completion.
Residents complain Salamusida Nabirye said her rentals adjacent to the plant had appreciated in value, rising from a monthly rent of sh40,000 to sh70,000.
Jonathan Ssuna termed the minister's move irrational. “We know that there are sugar factories in the districts of Kaliro, Jinja, Kamuli, and Bugiri, but what is wrong when it comes to Namayingo? President Museveni is busy promoting industrialization, but instead, his minister is against this,” Ssuna wondered.
Musa Osinya, the NRM mobilizer in Buyinja sub-county, said Mwebesa’s directive undermines the economic transformation in the district and also undermines the ruling party’s support in the 2026 elections.
Ronald Sanya, the Namayingo district LCV chairman, vowed to fight for the retention of the firm since it had been cleared by both the Uganda Investment Authority and the National Environmental Management Authority (NEMA). Sanya announced their next plan of petitioning Museveni after mobilising residents to append their signatures while opposing Mwebesa’s revocation letter.
