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Sheikh Mohammed Bin Maktoum Bin Jumah Al Maktoum, a member of the United Arab Emirates (UAE) royal family, is set to provide 7 cargo planes to Uganda to boost the East African country’s agro exports.
“We will provide 7 cargo planes and one of them, a Boeing 737, has since arrived at Entebbe Airport,” Sheikh Mohammed Al Maktoum told ChimpReports during his recent trip to Uganda.
“Other cargo planes will arrive in Uganda in the next couple of weeks,” he emphasised.
“I consider myself a Ugandan and we will work together to develop this country,” the Prince added.
Uganda’s agro exports sector growth has been impaired by the lack of quality packaging capabilities, insufficient storage facilities, poor post-harvest handling practices, shortage of agricultural credit, high freight costs and limited knowledge of modern production practices.
Ugandan producers often find it difficult to meet sanitary and phytosanitary standards required to export goods to Europe and the United States.
However, the Prince is expected to modernize Uganda’s air cargo capabilities and build a cold storage center in Entebbe.
Officials said the cold storage will facilitate massive exports of agricultural commodities to existing and new markets such as UAE and Algeria.
Uganda’s potential
Uganda has prioritized import changeover and export promotion strategies to address trade imbalance and accelerate inclusive growth to move the country to middle-income status.
The country aims to increase the export value of processed agricultural commodities and their products from US$ 0.935 billion in 2019/20 to US$ 2.7 billion in 2024/25.
Official statistics show that Uganda’s dairy industry has the potential to reach US$1.5 billion by 2025, with increased production and processing capabilities.
The African meat market is expected to reach US$128 billion by 2030, offering export opportunities for Ugandan beef and poultry.
According to Food Business Africa, Uganda is one of the major producers of coffee in Africa, ranking at 2nd place in Africa, with Ethiopia ranking number one. Uganda also produces tea, cotton, maize, cassava, and bananas.
There is potential to increase production and productivity of these crops, as well as to diversify into new crops such as fruits, vegetables, and oilseeds.
The East African market for fruits and vegetables is expected to reach US$1.3 billion by 2025, with Uganda well-positioned to contribute significantly and this growth is projected to continue to increase further in the coming 10 years, according to research.
The global market for oilseeds is projected to reach US$630 billion by 2027, with Uganda having the potential to export products like sunflower seeds and sesame seeds.
Uganda also has plenty of freshwater resources, making it ideal for aquaculture. There is potential to develop the production of fish, shrimp, and other aquatic products for export.
Fish production is projected to increase steadily, reaching an estimated 1,700,000 metric tons13 by 2025, catering to both domestic and regional demand. Fish and fish products are the third high- est value exports after gold and coffee, with a target of reaching US$698 million in exports by 2024/25.
However, the export of fresh produce from Uganda to Europe faces several challenges, including limited capacity and high transport costs. The high transport costs are due to various factors, such as the minimal number of direct flights from Uganda to Europe, high fuel prices, and costly air freight charges.
The export of fresh produce to Europe requires delicate handling. Airlines play a crucial role in ensuring that fresh produce is transported quickly and efficiently, minimizing damage and maintaining the quality of the produce.
Yet, the Uganda Air Cargo is literally defunct.
The company that specializes in cargo freight has been unable to do business for almost four years now owing to a lack of operational capital and grounding of most of its aircraft, some of which are no longer airworthy and have been condemned according to international aviation standards.
In 2023, the general manager of Uganda Air Cargo (UCC, Entebbe), Lakibus Lakara, recommended disposing of the airline’s grounded fleet due to its poor condition and prohibitively high repair costs.
Appearing before Uganda’s Committee on Defence and Internal Affairs on March 26, 2023, Lakara said despite being potentially repairable, the costs outweigh the benefits and disposing of them is more cost-effective.
“I have no aircraft in the air as we speak. One is in the hangar under repair. Although one is repairable, the cost of repair does not make economic sense. So the process now is to see that we dispose of those aircraft [rather] than keeping them on the ground,” he said.
To facilitate the export of fresh produce, some airlines have developed unique cargo services that cater to the needs of fresh produce exporters.
The Prince is expected to invest in specialised equipment, such as temperature-controlled containers, and specific handling procedures to ensure that the transportation process is managed carefully and efficiently.
“We have been looking to establish impactful projects in Uganda that will add value to the Ugandan communities,” he told the media last week.
Oil refinery
Sheikh Mohammed Al Maktoum, who also doubles as the chairman of Alpha MBM Investments LLC, is also expected to invest in a 60,000 Barrel Per Day Oil Refinery, a Fruit Processing Hub in Bukalasa, a Logistics Hub at Entebbe International Airport, and a Gold Refinery and Freezone Complex in Entebbe.
“We want to build an oil refinery in Uganda that will help the country to benefit from her oil wealth.”
The Uganda Refinery Project includes the development of a 60,000 barrels of oil per day (bopd) refinery located in Kabaale -Hoima District, a 211-kilometer multi-products pipeline from Kabaale to a distribution hub in Namwambula -Mpigi District, a refined product storage terminal in Namwabula – Mpigi, and a raw water pipeline from the Lake Albert to the refinery in Kabaale.
The project will be funded through a debt-to-equity ratio of about 70:30.
Alpha MBM, as the Lead Investor will be responsible for raising the debt for the project. The Uganda Refinery project is estimated to cost around US$ 4 billion.
The refinery project compelled the government to identify and acquire 29sq.km of land for the development of the Kabaale Industrial Park(KIP).
Government and its partners have since developed the master plan for the KIP which will house an international airport, refinery, crude oil, and products storage, transmission hub, logistics warehousing, offices, petrochemical industries, and associated facilities among others.
With a total of $60 billion committed from 2012 to 2022, the Emirates are the fourth largest investor in Africa over the last decade, behind China, Europe and the United States.