Published on 30/07/2024
Legislators on Committee of Commissions, Statutory Authorities and State Enterprises (COSASE) are alarmed that the Uganda Industrial Research Institute (UIRI) is buying machinery for private individuals, such as former Inspector General of Police Kale Kayihura, while other industrialists face high credit costs.
This preferential treatment raises concerns about fairness and the efficient use of public funds. Struggling industrialists question why they must bear expensive commercial loans while some receive undue advantages.
During the July 22, 2024, meeting it was uncovered that former Inspector General of Police Kale Kayihura received government-funded machinery for yogurt and cheese production at his Katebe Farm from UIRI’s business incubation facility.
Medard Sseggona (Busiro East) cautioned that UIRI’s emphasis on buying machinery for private businesses, rather than training industrialists, risked mimicking the National Agricultural Advisory Services’ (NAADs) deviation from its primary mission to supply agricultural inputs.
“I find it very unfair to other Ugandans who go to commercial banks and borrow at astronomical rates, while some just walk to UIRI and get funded,” remarked Sseggona.
He added, “The concept of UIRI seems to provide capital to some companies and individuals. I could choose value addition in milk, and instead of buying my own machines, I just write a concept, get funded, and receive machinery without going to a bank. This is similar to the NAADs, which diverted from advisory services to buying implements.”
Charles Kwesiga, Executive Director of UIRI, defended the government’s move, stating, “Our focus is on what it takes to develop an enterprise. It needs appropriate technology, highly skilled manpower, and affordable financing. If these factors are in place, we can produce marketable products.”
Joanita Orishaba, Director of Industrial Production Systems at UIRI, supported Kwesiga, explaining that UIRI provides a platform for Ugandan enterprises to test their business ideas before investing their capital. “We are trying to avoid the ‘valley of death,’ where most ideas die if not commercialized. The business incubation infrastructure allows entrepreneurs to move from idea to commercialization,” Orishaba said.
Officials informed the Committee that Katebe Farm Limited, owned by Kale Kayihura, received machinery in 2022 for dairy farming value addition, but progress has been slow.
Sseggona questioned why Parliament shouldn’t allocate the funds given to UIRI to Uganda Development Bank, allowing private individuals to borrow at 6%, while equipping UIRI with funds for training and skilling. “You should specialize in skills and technology choice, but individuals make their own technology investments. Establish a one-stop center for particular technologies, train people, guide them on where to buy machinery, and provide guarantees,” Sseggona suggested.
He cautioned that continuing the current module would not yield a multiplier effect, as limited funds would only benefit a few individuals, leaving others without support. “We need to strategically choose technologies as a country, train people, and ensure productivity to avoid losing money,” Sseggona concluded.