Last week I had the privilege of interacting with exporters
of agricultural produce and was pleasantly surprised to discover that there are
people in this country who while they may have reservations about how the
country is run or the economy is behaving, have decided they will make the best
of the situation anyway.
One exporter told me he exports a ton a day of bananas – matooke,
bogoya, gonja and ndizi, through Entebbe airport but estimates that at least
two Fuso trucks of bananas fly out of Entebbe daily. A FUSO truck does about
eight tonnes so that would be 16 tons daily.
Following the meeting I went to the Uganda Bureau of Statistics web page and found that in 2018 we exported 16,336 tons of bananas. This comes down to about 45 tons a day, assuming we are exporting every day of the week.
As I learnt at the event, “The Uganda-UK Agri-connect
conference” organized by the Uganda Export Promotion Board (UEPB) and the UK’s
Department for International Trade, that these numbers which have grown over
the last two decades are in spite of huge challenges of policy and
infrastructure faced by our people.
Banana exports are a good test case for us. Uganda is the
largest producer of bananas in the world after India and the highest producer
by a mile in Africa. Tanzania produces about three million tons to our 12
million tons. So we are exporting less than a percent of our production.
There is a worldwide demand for ndizi and bogoya as a fruit
but who buys matooke and gonja abroad I wondered. I was duly informed by one
exporter that apart from the Ugandan diaspora there is great demand from the
Congolese, Rwandans, Burundians and West Africans.
So there may be scope of increasing exports by a factor of
ten, to one percent of our production or 120,000 tons annually. The possibility
is mind boggling.
Last year we earned $6.4m from the export of bananas.
Why the banana statistics caught my eyes is that these were
being exported in quantities I never imagined, through Entebbe airport.
But a cursory look down the list of non-traditional exports
shows the untapped potential of non-traditional agricultural exports. Fish led
the pack bringing in $210m in export receipts, followed by maize, $147m, beans
and legumes, $144m.
And as mentioned earlier this is in spite of this
government’s inadequate support and sometimes obstruction of this progress.
"High freight charges out of Entebbe were a big issue, but officials of the logistics industry who were present in the conference pointed out that if there was as much freight coming in as was going out, for one, the rates would fall...
However, the greatest impediment to the long term
development for the export of perishable agricultural products was the
inadequacy of the cold storage facilities at the airport. Exporters complained
of their consignments being held up for ours in the blazing sun because of the
limited capacity of the cold rooms at the airport.
Exporters consignments are often rejected by their clients
because he goods are spoilt when they arrive at their intended destinations.
One exporter complained he had lost $30,000 just the previous week because his
goods were rejected in Europe.
I came away from the event with two major learnings. That
the cliché that we are not living up to our potential is true and obviously
understated.
While challenges still remain in generating the quantities,
up to the standards and quality required in markets, this can be easily
surmounted with correct strategy and execution from the national to the farm
level.
"But my biggest take away was reinforcement of the belief that the one of the greatest legacies of this government will be that they liberalized the economy. That an individual can see an opportunity and organize himself or herself to take advantage of it without recourse to higher authorities is what has spurred this exponential growth in non-traditional exports. None if any is driven by government agencies ....
Nontraditional exports overtook traditional exports – listed
as coffee, cotton, tea and tobacco by UBOS in 2001 and have never looked back,
to the point that last year we exported almost five times as much in
non-traditional exports $3b than traditional exports of $659m.
Liberalizing the economy unlocked individual initiative
which was stifled by the giant state marketing monopolies which were not even
doing a decent job.
As an example I met a lady who is doing a rip roaring
business exporting sugar cane to Germany! Shipping out a few tons a month to
serve a juice bar chain in Hamburg.
UBOS has no entry for sugar cane exports in its official
statistics.
That being said there is a lot more government can do in
facilitating the whole agricultural value chain. Production needs to and can be
pushed up several fold across everything we produce through improved farming
methods, irrigation and improved post-harvest handling. Huge improvements are
need in infrastructure to improve access to markets. Paved roads and improved
feeder roads are good but a functioning railway to significantly reduce costs
is critical. Export promotion and other support for exporters needs to be
beefed up as many of these exporters cannot break into foreign markets
unassisted. In the same vein we need to commit to some sort of agricultural
financing model that does not use existing commercial banks as a delivery
model.
Another impression I got is that apart from paying lip service to the fact that most of our people -- at least seven in ten Ugandans, derive a livelihood from agriculture, government is behaving as if we have all the time in the world to tap into this bounty. That it will always be there for us to exploit....
A case in point is the fact that the UK imported $1.8b in
coffee products last year, Uganda’s share of that figure is $1.8m or less than
a percent. If you think about it as the largest coffee exporter on the
continent, Commonwealth member state, how can’t we manage at least five- or
even ten percent of the UK market? It boggles the mind!
