The Minister of Trade, Industry and Cooperatives, Amelia Kyambadde, has revealed that the drop in sugar prices is due to the smuggling of sugar into the country.
Kyambadde, who was responding to a question raised in the House on the alleged importation of sugar from Kenya said that the porousness of the borders has made smuggling easy and hence the low prices.
“There has been a drastic drop in sugar prices from shs8,500 last year to shs2,760 as per yesterday. This drastic drop was due to smuggling of duty free sugar from Kenya,” she said.
She further explained that the boda bodas have been smuggling the sugar repacked in branded bags of Kakira, Kinyara and Lugazi sugar making it difficult for Uganda Revenue Authority (URA) to seize it
Legislators were not satisfied with the minister’s response and tasked her to explain why sugar is being imported and thereby affecting local manufacturers.
Hon. Jalia Bintu (NRM, Masindi) told Parliament that one million tons of duty free sugar was imported from Kenya.
“Kenya was importing sugar during elections yet they were also producing their own sugar. They had surplus and this surplus is what is finding its way back here. We had requested the Ministry to curtail the importation of sugar, which was hindering local manufacturers,” she said.
Hon. Odonga Otto (FDC, Pader) said that he had evidence that there was sugar coming into Uganda between January to October 2016.
“Sugar has various uses; for home consumption and industrial use. When the sugar meant for industrial use enters the country, it is put on the open market. This is tax evasion,” he said.
He suggested that a select committee be constituted to investigate why sugar isn’t kept in bonds by Uganda Revenue Authority.
Hon. Maurice Kibalya said that sugarcane farmers no longer have any market for their produce because of the importation.
“Farmers are suffering and are stuck with sugarcane; they cannot sell it anywhere. Kamuli sugar factory has closed because the stock was too much. Does the minster know why the cost of sugarcane is going down and yet the cost of sugar was increasing?” he asked.
Kyambadde said that smuggling was the sole reason as to why sugar prices had gone down.
The minister said that working with other security and enforcement agencies, they would fight sugar smuggling.
She promised to present a comprehensive statement to the House on action taken. Speaker of Parliament, Rebecca Kadaga, asked the Minister to submit the report within two weeks.