Members of parliament have moved a motion under rule 109 of our rules of procedure is to censure Minister of Finance, Planning and Economic Development, Matia Kasaija over incompetence.
This has been confirmed by Kasambya County, David Kabanda who says that the MPs are accusing Matia Kasaija of Incompetence on pending multibillion projects including Lubowa Hospital botched deal, Coffee agreement and issues relating to Entebbe international airport and usurping Parliaments mandate of appropriation as grounds for censuring Kasaija.
“A censure motion under rule 109 of our rules of procedure is being considered against Minister of finance, Hon Matia Kasaija citing Incompetence, Lubowa Hospital botched deal, Coffee agreement, issues relating to Entebbe airport and usurping Parliaments mandate of appropriation” Kabanda said.
DETAILS IN THE COFFEE DEAL MOU
Several questions have been raised about the foreign investor behind the Uganda Vinci Coffee Company Ltd, a company that has been awarded exclusive rights to buy all Uganda’s coffee among other incentives which has become the center of debate both in parliament and the general public.
Now the latest news reaching our news desk indicates that the suspected “owner”, an Italian investor Ms. Enrica Pinetti signed the multibillion contract as a witness not the owner.
The deal signed between the Finance Ministry and UVCC in February prohibits other investors from buying the country’s harvest until the company gets the quota they want.
According to the February 2022 Memorandum of Understanding (MoU), the agreement was signed by Finance Minister Matia Kasaija on behalf of government, in the presence of Ramathan Ggoobi, the Permanent Secretary of the Finance Ministry and pinetti signed as a witness while the space for the company owner was left blank.
The MOU further revealed that UVCC is a limited liability company that is fully registered with its office located at Plot 2, Summit View , Kololo in Kampala and the coffee processing facility is expected to have a capacity of 60,000-tonne per annum.
While the government is undertaking the role to inject in money, in the deal ending in 2032, the company will have exclusive rights to buy all of Uganda’s coffee and be will be exempted from paying taxes including income tax, pay as you earn, Excise Duty, Stamp Duty, VAT, Import Duty, and corporate income tax.
“GoU undertakes that it will take all reasonable measures to give priority of supply of coffee to the Company before registering any contract or acknowledging any arrangement for the export of Coffee beans…” the MOU reads in part.
“For avoidance of any doubt, the company shall be exempt from corporate income tax for a period of ten (10) years; b enjoy duty-free importation of all Plant and machinery, motor vehicles, construction materials and equipment, packaging materials and any other materials for use of this project under the Easy African Community Common External Tariff (EAC-CET)”. Article 4.1.3 of the MOU reveals.
“If there is any change in law or change in tax which substantially alters the economic benefits accruing, the company may within one year from commencement of the deed (February 10) write to government in order to maintain the economic benefits of UVCC.” the MOU adds.
The agreement also reveals that UVCC will receive an electricity subsidy so that the price they pay for electricity at the plant does not exceed $ 5 cents per unit.
In the same MOU, the government will also ensure a steady adequate water supply via pipeline to the plant at the company’s cost to enable its operations and also construct an access road linking the plant to the main Jinja Road.
However Buganda kingdom Prime Minister Peter Mayiga and a section of Ugandans, including processors and other stake holders have dismissed the agreement, saying the government sidelined them and signed the agreement without out their consent
While attending the Easter Sunday service at Lubaga Cathedral last week, Peter Mayiga noted that while signing the deal, the necessary stakeholders were not consulted.
“Then came Vinci Coffee Company to buy and sell Ugandan coffee almost as a monopoly. Those who signed the agreement never consulted anyone but claim it is good. We all understand English and know how to interpret agreements, be it laws. Farmers were never consulted; neither dealers nor exporters were consulted. Buganda has a big stake in the coffee industry but why were we not consulted? How can the Ministry of Finance officials claim to know more about coffee than those of us who are on the ground,” Mayiga asked?
The controversy has thus forced Speaker of parliament Anita Among to order the committee on trade, tourism, and industries to probe into the matter which the committee chairman responded by summoning a list of stakeholders in the coffee sub-sector who have been invited to appear on April 25 and April 26, 2022, for questioning.
Those summoned to appear before parliament include finance minister Matia Kasaija, Pinneti, Finance ministry permanent secretary Ramathan Ggoobi, Attorney General Kiryowa Kiwanuka, Nsumikambi Mugambe; Minister for Trade, Tourism Industry and Cooperatives Francis Mwebesa, Minister of Agriculture Frank Tumwebaze and the Solicitors General.
By Kobusiinge Monica