President Yoweri Museveni has said he initiated the controversial coffee agreement signed between Italian businesswoman Enrica Pinetti’s company and the government of Uganda.
Government recently signed a deal with Uganda Vinci Coffee Company Limited to establish a coffee processing plant at Namanve industrial park but also help sell Ugandan coffee abroad.
The coffee deal has since brewed controversy from several corners of the country with parliament recommending that the agreement be terminated.
Pinetti, the owner of the company, has been accused by many of being a fraudster, having earlier been involved in the deal for the constriction of Lubowa International Specialized Hospital but the same has since stalled.
However, speaking on Tuesday during the State of the Nation Address, President Museveni admitted that Pinetti has no experience and that he is the one who asked her to help the country in that line of business.
“When I met madam Pinetti, she had no idea about coffee. I, however, could see she had a wide network of contacts and I asked her to look into coffee. After some time she came back with a positive report that it is doable. For her she was in hospitals,” Museveni said.
The president however warned the public against attacking the woman behind the controversial coffee deal, saying she will enable Uganda benefit from her coffee.
“Those attacking that project are supporters of perpetual bleeding of Africa. If they were not, they would have responded to our call to add value to coffee and seek government assistance. I am ready to sit down with all coffee people. If you want add value I will support you. Instead of attacking the saviour, if you are genuine, join the liberation effort,” the president said.
Museveni explained that coffee growing countries all over the world get less revenue from the sale of their coffee, adding that it is other countries that benefit from this coffee.
He cited a type of Robusta coffee known as Screen 18 that he said if sold as green coffee, after removing the skin, a kilogram goes for $3.34 on the world market.
“When a kilogram is roasted in London and ground, it shrinks to 700grams and packed into packets of 300grams each. Each packet is sold at $12, which means that 700grammes may fetch about $30. Therefore, for what Uganda gets $ 3.34, the smart people of UK, get $30. Each coffee bean that is sold in supermarkets abroad, takes away our phosphorous, our nitrogen, our potassium and other nutrients for 10% of the value at which the final consumer buys the product.”
“The total value of coffee in the world is $460 billion. However, of this figure, the coffee growing countries only take $25 billion. The African coffee growing countries only take $2.4billion When we de-hust, roast, grind and pack here, Uganda will get more dollars and we shall also pay higher prices to our farmers.”
According to Museveni, it is this value addition to Ugandan coffee that Pinetti and her Vinci company are bringing for the country, noting that it is wrong to abuse her.
“You have seen the calculation. How can this be? How can we accept this and I call myself president? I am not a clown. I will meet anyone willing to add value to our coffee.”
The revelation by President Museveni comes on the background on another revelation that Pinetti signed the controversial coffee agreement as a witness and not as an investor.
A leaked February ,2022 MoU indicated that the deal was signed by Finance Minister Matia Kasaija on behalf of government, in the presence of Ramathan Ggoobi, the Permanent Secretary of the Finance Ministry on one side and the Uganda Vinci Coffee Company, a limited liability company that is fully registered with its office at Plot 2, Summit View , Kololo in Kampala one the other side.
“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 agreement reads in part.
Article 4.1.3 of the agreement states that, “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 4.1.4 goes ahead to say that, “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.”