In Summary
  • State of affairs. Although Ugandan flower exporters claim they are now at the stage where you would say the industry and market are stable, they are struggling to convince government to identify land, reduce the cost of electricity and lower the cost of finance to enable them increase production and volume of the product they export.

Kampala.

Lowering the cost of starting a business in Uganda will see the floriculture industry return to its former glory where it was ranked among the top five export commodities, industrial players have said.
In neighbouring competing countries of Kenya and Ethiopia flower dealers have been allocated land and other incentives and because of this new investors have been attracted.
But in Uganda the players are struggling to convince government to identify land, reduce the cost of electricity and lower the cost of finance to enable them increase production.
In an interview with Daily Monitor at their offices in Entebbe on Monday, the executive director Uganda Flower Exporters Association (UFEA), Ms Juliet Musoke, said: “We are gradually struggling to reclaim our glory we enjoyed 12 years ago in terms of export volumes.”

Lost glory
Flowers which were ranked among the top-five country’s exporting commodities, suffered setbacks that saw eight players from the 22 then close shop and others relocating to neighbouring countries.
Ms Musoke said: “We are now at a stage where you would say that the industry and market are stable. But we want to grow further to be able to level with countries like Ethiopia who came late in the business.”
Despite their challenges current statistics show that in the year ending 2017 the industry exported a total of 7,400 tonnes (7.4 million stems) which was a slight increase of about 200 tonnes registered in 2016. They project this to even go further this year to hit the 7,500 tonnes (7.5 million stems) the highest the country exported 12 years ago.

What is required
In order to compete better, Ms Musoke said they need land to enable the existing firms expand and also attract new investors into the country.
“We need land which is affordable for the investors and our argument with government is to identify land with leasehold so that investors can expand. This land should also have the right infrastructure which involves roads, water for ease of doing business,” she added.

Costly electricity
Because flowers are grown in green-houses, power is one of its main inputs but currently this is very costly. To make matters worse sometimes power is not enough for them to carry out their work. To salvage the situation they supplement it with generators which is an added cost for them to buy fuel to run the generators.
“On average each farm spends Shs25m to Shs30m per month on electricity bills alone. During this time members are using generators with fuel expenses amounting to Shs10m to 20m,” Ms Musoke shared.

Single window
As the exporters are waiting for government to respond to the above mentioned demands, it has introduced an online clearing of export business documents to enable exporters ease doing business.
The Uganda Electronic Single Window Project (UESW) allows importers and exporters to submit regulatory documents such as Phytosanitary Certificate, customs declarations and all regulatory documents using a single access point.
The ministry of Trade, Industry and Cooperatives, in conjunction with the Uganda Revenue Authority, launched the UESW.
In an interview with this newspaper, the Uganda Revenue Authority manager corporate communications, Mr Ian Rumanyika, said: “UESW brings together different government agencies and departments on a single portal where one can receive and access regulatory documents which facilitate business.”

Condition
The project coordinator at the ministry of Trade, Mr Francis Kolou, said: “Flower exporters are also required to submit their documents online as a requirement by the World Trade Organisation.”
He said the project has received positive response especially from the private sector that has started recording reduced cost of doing business.
Ms Musoke said the system is user friendly but still needs improvement especially in the area of e-phytos which are not recognised at the destination countries.