The Federation of Small and Medium Sized Enterprises(FSMES), has asked the government to cancel the controversial coffee agreement that it recently signed with Uganda Vinci Coffee Company Limited(UVCC) to establish a coffee processing plant at Namanve industrial park.
Speaking to the Nile Post shortly after a news conference regarding the matter, the executive director of FSMEs John Walugembe said Uganda is the leading grower of coffee not because of big investors but is because of local SMEs and farmers who are have been working hard to push the industry to where it is now and need to be supported.
"We oppose this deal; the concern we have with this agreement is limited consultation that was undertaken. An agreement in this nature should only be developed after very intense and compressive consultations. We are concerned by the lack of transparency that has shrouded the entire deal," he said.
He stated that whereas they welcome foreign investors in the country, they believe that they need to compete fair and square with local SMEs.
"If there is a need to improve the business environment, then this should be pursued collectively without trying to undercut the system by making bilateral deals that disadvantage many people. Therefore, as FSMES we think this is a bad deal and we think it should be crashed," he said.
He explained that Uganda is doing well with coffee and there is no need to gamble with the commodity which is one of the leading sources of foreign exchange.
Last week ,the government defended the deal with an Italian investor saying the agreement was sanctioned by the Attorney General and no single law was violated.
The investor is the individual behind the multi-million-dollar construction of the Lubowa specialised hospital, which is more than two years behind schedule despite the $379 million (about Shs1.4 trillion) backing from the government.
Pinetti’s firm, according to the secret agreement, whose details have since been leaked to the public, will be exempted from paying import duties, value-added taxes, excise duty, stamp duty and corporate income tax, among others.