Business
Arabs eye joint ventures targeting food production
President Museveni talking to delegates who attended the 31 meeting of the Islamic Chamber of Commerce, Industry and Agriculture that met in Kampala in April 2015
The business community in Uganda should be interested in the growing interest by Arabs in Uganda as well as other African countries.
While the recently concluded 31st General Assembly of the Islamic Chamber of Commerce, Industry and Agriculture (ICCIA) offered an opportunity for them to quench their information thirst, it wasn’t to be as many missed attending the conference thanks in part to their not being members of the Uganda National Chamber of Commerce and Industry.
The president of the Uganda National Chamber of Commerce and Industry Olive Kigongo blamed the media’s lack of interest towards the Arab world.
The ICCIA is an organisation of chambers of commerce of 57 member states of the Organisation Islamic Countries (OIC) with a combined GDP of US$6 trillion and a population of nearly two billion people.
Fortunately, The Sunrise has obtained exclusive information from those who participated as well as those who are familiar with the Arab trading preferences and now here explores how Ugandans can tap into the promising lucrative businesses with the Arabs.
Asumani Mukiibi Sserunjogi, the President of the Islamic Chamber of Commerce in Uganda told The Sunrise that Arabs are interested in forming partnerships with Ugandans especially in the field of agri-business with the objective of producing food for export to their countries.
“The reason why Arabs are coming to Uganda is that they want to engage with indigenous Ugandans to produce food for their people,” this is in addition to the fact that Uganda is the only East African member of the group.
Mukiibi notes that Arabs have been interested in Uganda for quite some time but were reluctant because of the absence of enabling laws such as the Public Private Partnership as well as the one for Islamic banking that suits their ways of doing business. The passing of the PPP law, he argues, has opened the way for joint partnerships to take place.
In the meantime, Mukiibi explained that the law to promote Islamic banking that had been forwarded to Parliament, was taken back to Cabinet to ensure that drafts persons and other relevant government officials such as ministry of finance experts understand the working of Islamic banking.
According to Uganda’s Ambassador to the OIC Sheikh Yahya Ssemuddu, Arabs have for long been interested in partnering with Uganda in the areas of infrastructure, agricultural production, health and tourism but were not aggressive enough in pursuing the opportunities.
Ssemuddu made the comments recently while meeting President Museveni where he informed him that OIC through the Islamic Development bank intends to extend a grant of $380m (about Ushs1.2trillion) for rural electrification, health and vocational education.
In the agricultural sector, Mukiibi noted that Arabs want to produce food items such as meet, vegetables and coffee by partnering with Ugandans.
“They want to create a regional hub for coffee growing and processing here in Uganda,” added Mukiibi: “They are further interested in investing in sectors such as tourism.”
Mukiibi notes however that while Arabs have been interested in expanding their trade towards Africa, they were waiting for enabling laws such as the Islamic banking law that allows their nationals to partner with locals in business.
He adds that Uganda’s membership to the OIC gives it added advantage compared with neighbouring countries because it can enable the country to tap into financial resources made available by OIC institutions for investing in member countries.
Mukiibi advised Ugandans however to conserve and preserve their land so that they use it to attract Arab investors.
“Using the Islamic banking principle of partnerships and sharing of profits and losses, Ugandans can contribute land, labour in projects while the Arab investors bring capital in joint projects. So my advice to Ugandans is that they should not sell land,” he cautioned.
Analysts from different think tanks have argued as well that since the Arab Spring uprisings that were sparked off partly by high food prices, Arab governments have gone back to the drawing board and decided to look for ventures of containing food prices by influencing its production.
Uganda, which has the best conditions for food production in the region, including the availability of fresh water, arable land, in addition to favourable climatic conditions, is thus looked at as a prime partner by Arab countries.
Comments
