Museveni warns against attacks on Atiak sugar factory

President Yoweri Museveni has cautioned political leaders against frustrating the now-closed Atiak Sugar Factory.

Government owns 40 per cent shareholding in the Amuru district-based factory, a subsidiary of Horyal Investments Holding Company Limited after increasing its stake in 2019.

The factory was commissioned in October 2020 and has an annual production capacity of 66,000 metric tonnes. The company had been financially strained since the closure of Crane bank in 2017, one of its key creditors. After the bank was sold to dfcu, the company couldn’t restructure its debt until the Ugandan government stepped in as an equity partner.

In May 2018, the government, through the Uganda Development Corporation (UDC), acquired 10.1 per cent of shares worth Shs 20 billion to help complete the factory. In July of the same year, an additional Shs 45 billion was invested, raising the government’s stake to 32 per cent.

By April 2019, Atiak had requested another Shs 24 billion from the government for the construction of staff houses and offices, which increased the government’s share to 40 per cent. Atiak has now put on hold sugar production until July 2025 when it can sustainably produce its sugarcane, diverting from other models of sugar processing companies that rely on out-growers.

“Political leaders, please stop diverting our people. Stop the opportunism of misinforming our people; there is no issue that we cannot discuss. Atiak is a growth stimulus for the area. Once you have such a project here, all the surrounding people will benefit. I am happy with what I have seen at the factory. Let us not relax; let’s continue moving,” Museveni said.

Museveni said the opportunism of diverting people should stop and he will not allow any distortions or confusions created by any group like the Balalo, who were coming from the southern part of the country.

“I learned the company can now grow its own sugarcane. Cane is not a high-value crop; it should never be grown by smallholder farmers. They should follow the four-acre module for the growing of coffee, pasture for animals and others. I urge regional MPs to support sugarcane growing on top of commercial agriculture,” he said.

Amina Hersi Moghe, Horya chief executive officer said the company has changed from previous manual growing of cane to mechanization, from land preparation to the harvesting of cane with all processes now mechanised. 

“We are constructing a dam for irrigation of sugar during the dry season. With irrigation, we shall be able to harvest sugar cane in 13 months instead of 18 months. The factory has closed because there are no raw materials, not because it cannot produce them,” Amina said.

Norbert Mao, the minister for Justice and Constitutional Affairs, said Atiak Sugar is about the prosperity of the people.

“People who were previously perceived to be hostile to investment on large chunks of land have demonstrated that they can embrace such investment. That’s why we call it a public-private community partnership. These 25,000-acre sugar cane projects cannot be allowed to fail. When it succeeds, it will inspire other areas.”

“Toyota made losses for 20 years in Japan, but the government never gave up on them. They kept investing. I can bet that 90 per cent of the cars driven in Uganda are Toyota vehicles. So Atiak sugar is a fruit of faith,” Mao added.