Govt denies trade embargo on Kenya’s cargo, licence revoked

Loss. About 1.4 million kilogrammes of CTU tobacco crop worth $3.5m (Shs9.6 billion)can neither be transported nor processed due to the denial of licences by Uganda’s government. 

By ISMIAL MUSA LADU

Posted  Friday, May 17  2013 at  01:

In Summary

Ban. A Kenyan tobacco firm claimed it was banned from transiting its Supermatch cigarettes through Uganda.

A senior ministry official has denied claims that the government banned Kenya’s cargo from passing through its territory in an attempt to shield the manufacturing sector from regional competition, particularly from Kenya.

The ministry of Trade Permanent Secretary (PS), Mr Julius Onene, in an interview yesterday also refuted claims that the government has a plot to block Kenyan companies from accessing South Sudan and other regional markets through issuing export transit ban—stopping other countries goods from being transported through Uganda.

Early this week, a Kenyan tobacco firm, Mastermind Tobacco (K) Ltd claimed in a press statement that it was banned from transiting its Supermatch cigarettes through Uganda to various export destinations namely South Sudan, Democratic Republic of Congo, Sudan, Rwanda, Burundi and Chad.

The statement issued by Continental Tobacco, a subsidiary of Mastermind Tobacco in Uganda, said the major reason for the ban is to give undue advantage in terms of competition to the Ugandan industry players, particularly a Ugandan company, Leaf Tobacco & Commodities Co. Ltd.

And consequently the company has been losing export sales to the tune of $2 million every month, the statement reads. The same statement said despite Continental Tobacco paying all its dues, the competition has ganged up to edge it off the industry after successfully influencing the Ministry of Trade, Industry and Co-operatives, to withdraw its licences on the grounds that it owes interest on late payment of farmers’ dues for their tobacco crop delivered in 2011.

 

Mr Onen in an interview yesterday described the statement issued by the tobacco company as baseless saying: “I met them (Continental Tobacco) yesterday and I told them that the statement was the most unfortunate thing. It contained no fact.”




He continued: “They (Continental Tobacco) have not fulfilled all the conditions, including paying the farmers.”

The Continental Tobacco license was revoked on October 30, 2012 for non-payment of outstanding dues after the parliamentary committee on agriculture’s report faulted Continental Tobacco for failing to pay about Shs26.3 billion to tobacco farmers in the 2011 season.