News – Page 4 – Prime Time Communications

News

#OutToLunch We can’t make face masks and then wear used underpants

By Denis Jjuuko A week ago, seven factories were opened in Namanve near Kampala. The president was there as ever to launch them. As ever, none of these factories which will make stuff such as tarpaulins and gumboots belonged to a Ugandan. It seems foreigners are seeing what we can’t see. What makes foreigners set up factories while we happily board the planes to go to China to import stuff the Chinese are happy to make here? There are many theories I hear one being that the government favours foreigners. I don’t want to agree. Foreigners come from a background where stuff are made and have understood that making things isn’t as difficult as many Ugandans think. The seven factories, according to The New Vision, were worth a mere US$12 million or approximately Shs44.4 billion. Each factory, therefore, cost just Shs6.4 billion. These seven factories will employ more than 2,000 people. This sadly reminded me of the debate some Ugandans love to make about manufacturing and assembling especially when it comes to vehicles. These Ugandans like to argue that you can’t manufacture cars in Uganda (yet 90% of buses on Ugandan roads are made in Kenya). That you can only assemble them and therefore that Uganda has not manufactured a car! Can anyone manufacture a car? An average car has more than 20,000 parts. Carmakers the world over source parts from the global automotive value chain. This value chain is comprised of hundreds of companies majority of which many of us have never heard of. I drive a small Japanese car. At the back of its key, there is a logo of the carmaker and something in small print that reads “Omron Corporation.” Omron Corporation made the key system as well as its automation system that detects many stuff including rain and whether I need a break from driving or not among others. Another company called Takata made its airbags. The music system is from Sony while the tyres are from Bridgestone. I can list many other parts but it will bore you. If you are keen about cars, you will also notice that some vehicles resemble each other even when they carry a different nameplate. Spear Motors sells Fiat Fullback Double Cabin pickups that look exactly like the Mitsubishi Sportero double cabs sold by Victoria Motors. The Tata lorries of the 1980s, if you are above 40 years old, that belonged to your school look exactly like the Mercedes Benz trucks of 40 years ago. South Korea’s Ssangyong Musso has a partnership with Mercedes Benz to use its technology same way Kiira Motors works with China electric car giant CHTC. There are many collaborations when it comes to the production of stuff. Buying parts or technology from the various suppliers is how stuff are made. If you are reading this on iPhone, know that Apple made no single part of what you are holding. Every part comes from somebody in the smartphone value chain. Let us bring this closer to home. Think of Kampala Serena, a 5-star hotel in Kampala. They prepare a buffet every day. The stuff they use to make that buffet comes from various suppliers from the food value chain. They don’t grow matooke or peanuts. They make no cooking oil. They don’t produce cooking gas either. Many suppliers bring the ingredients that Kampala Serena uses to make the buffet. Serena designs the menu and their chefs decide how it tastes and how it is presented to the customer. And ladies and gentlemen, cars are not made any different from the way Kampala Serena makes its food. The foreigners have understood that any product is made by many suppliers. That is how they come here and set up factories to make or assemble TV sets and fridges as we Ugandans fly to Dubai, of all places, to import finished products. We like to argue that something isn’t made in Uganda simply because many of its parts were sourced from suppliers from all over the world. The foreigners simply say this is Ugandan made, walk into Uganda Investment Authority and get tax incentives. In a few years, the foreigners who come here with little money are billionaires while we Ugandans are crying of slow business. We are happy to call them to employ our kids who we were paying Shs2m a term for 19 years. If you have been importing TV sets and fridges, I am sorry but Hisense is going to lead to the closure of your shop. If you used to import ceramic tiles, you know this so well. Ugandan entrepreneurs must think beyond importation, stop arguing that they can’t make anything and line themselves up to become suppliers of parts for the factories that are being launched every day or set up these same factories. Kiira Motors is building a factory in Jinja to make vehicles. Can’t a Ugandan set themselves up to provide nuts and bolts? What is so difficult in making brake pads for vehicles? Why do we still import car wipers and even headlight bulbs? How can we be so happy to replace parts in our cars with the junk that is sold in Kisekka Market? If we have managed to wear new face masks made by Ugandans, why do we still wear used underwear? The writer is a communication and visibility consultant. djjuuko@gmail.com

July 19, 2020

News

#OutToLunch Business bet: Grow food within 120km of Kampala

By Denis Jjuuko Last week we argued that most parts of greater Kampala will be urban in 30 years. Before that, Kampala’s population is estimated to grow to approximately 7.5 million people in the next 10 years according to the World Population Review. Urbanization means that they will be less land devoted to agriculture within Kampala’s 40km radius. Yet people still need food. Africa imports food worth approximately US$35 billion a year according to the African Development Bank and is estimated to grow to more than US$100 billion in the next 10 years. This is a result of “population growth, low and stagnating agricultural productivity, policy distortions, weak institutions and poor infrastructure,” says a report by the Food and Agriculture Organisation (FAO), a United Nations agency. Many of African dollar or even shilling billionaires are involved in food. In Uganda, we even import cabbages, onions and such other things! Yet our land is so fertile and the climate still favours agriculture. Uganda has a water body almost everywhere and even if you are to sink a borehole, the water isn’t that deep in most parts of the country. As Kampala expands and its population grows, there will be more demand for food than ever. The government is pushing industrialization as one of the ways to create the elusive jobs. With the internet and advancements in technology, many non-traditional jobs will be created leaving many youths working outside the agriculture sector. As Kampala expands, some people will become middle class. The middle class will demand more organic foods. They also don’t work in the gardens. Over the last few decades, many people have abandoned agriculture preferring to look for jobs in urban areas. The declaration that now some towns are cities will also lead to more people migrating to urban areas in search of jobs. At the end of the day, they will need food. There is a news video circulating online that the price of Matooke, the staple food in many parts of Uganda especially the populous central region has significantly gone down over the last few months. This has been largely attributed to the COVID-19 pandemic. However, the market and generally demand for food is enormous in central Uganda given the way Uganda’s economy is structured and the level of urbanization. One way farmers can cut costs and increase their incomes is by growing food that is needed in a particular market. If, for example, you grow a particular food crop where the market isn’t available it becomes expensive to transport it to the market. Let us take an example of Matooke. If you grow Matooke in western Uganda, the transport costs are enormous to bring it to Kampala where the market is. This means that the farmer will get less as the traders have to factor in the cost of transport. In the news video I referred to above, the farmers in Isingiro say the price of a bunch of Matooke is now between Shs500 and Shs3,000 instead of Shs15,000 on average they were being paid recently. In Kampala, a bunch of Matooke costs between Shs5,000 and Shs15,000 today from about Shs12,000 to Shs30,000 a few months ago. This means that most of the money the farmer could get is now taken by the transport man. With increments in taxes levied on fuel, the farmer will get much less. As you know, our value addition on Matooke is still in its infancy even though there is a factory that is being set up to make flour among other products. So the best bet for a farmer now to increase their profit is to grow food within a radius of about 120km from Kampala. This will cut down the cost of transport significantly and avoid price fluctuations that result in flooding the market. When a farmer is far away from the market, they may not be able to predict the market as they need much more time to bring the product to Kampala. A farmer within 120km of Kampala can easily monitor the market in Kampala and decide whether to bring the Matooke to the market or not since the delivery period is short. In two hours, a farmer can have his Matooke on the market if the plantation is within a radius of 120km. This calls for zoning the country so that farmers whose products are perishable like Matooke grow it near their biggest markets. Produce with a long shelf life can be grown anywhere even though the transport challenges would remain. So for those who are looking for post-COVID-19 business opportunities, growing food within a radius of 120km from Kampala is a smart bet. The writer is a communication and visibility consultant. djjuuko@gmail.com

July 9, 2020

News

#OutToLunch One of the idiot’s guides to retire with a million dollars

By Denis Jjuuko A few weeks ago, I read an article of how one can retire at the age of 65 with a million US Dollars if one saved and invested from the age of 25. That is 40 years of saving. The author argued that one needs to save about US$150 a month. I was intrigued. However, the article was meant for the American audience and therefore some of the stuff listed that one could do aren’t applicable here. I have been thinking about it for those few weeks and came up with a model that could work in Uganda. At today’s exchange rate, US$150 is about Shs560,000. I decided to round it off to Shs600,000 a month. This model is for those who are employed and therefore don’t have time to do business. I also moved the age from 25 to 30 for one to be able to start saving Shs600,000 a month or if they are a couple, Shs300,000 each. I know many people can’t save this much but many can do that. The age of retirement remained at 65 but my model is for only 30 years. If one saves Shs600,000 every month, it means that they will have Shs7.2m a year as savings. Many people reading this article can save this money if they wanted. I went back to 1990, which is 30 years ago and imagined the map of Kampala. How did Kampala look like 30 years ago? It was a nice town where most people lived in a radius of less than 10km from the main post office on Kampala Road. The rest of the suburbs where Kampala residents reside today were burial grounds. Uganda’s population was just 17 million people with Kampala accounting for approximately 755,000 people according to most statistics I could find online. Areas like Naalya were bushes. A friend says there were no major roads in Najjeera. Some of the current roads only existed as footpaths they used to take to raid jackfruit trees. Uganda’s population is expected to grow to 100 million people in 30 years. So if you are 30 today, you will be 60 years old in 2050. What kind of Kampala do we see in three decades? You can replace Kampala with any town or city where you live. Unless Uganda fights some wars and annexes some parts of its neighbours like Idi Amin unsuccessfully tried, the land size will remain the same. There is going to be unprecedented pressure on land with a growing population making the price of land skyrocket. Areas today that are devoid of urban dwellers will be urban and worth a lot of money in 30 years. So anybody or a couple that can save Shs7.2m a year for 30 years will be able to retire with a million dollars by just investing in land. What the couple needs to do is to ensure that they buy at least a plot of land worth Shs6 million a year. That would leave them with Shs1.2m to pay for the transfer of titles and even plant some trees on it (depending on the location). If a person or couple do this for 30 years, they will have 30 pieces of land in areas that are becoming urban. Areas like Matugga, parts of Mukono, Luweero or Mpigi where land is sold at such prices, will be very urban. Replace Matugga or Ziroobwe with any area where land is being sold at that rate. So in 2050, somebody who has been investing consistently will have an asset base that is worth a lot of money. Remember the plan is to retire at 65 with a million dollars. In 2055, at 65, one will start liquidating the first 20 properties bought. That means selling the pieces of land bought between 2020 and 2040. This means that you would have owned each of these 20 pieces of land for 15-35 years. Let us go back to Kampala of 1990. The growth of Kampala and other urban areas coupled with an explosion in population means that the same scenario will still exist in 30 years. So if you invest Shs7.2m in a property today, in 30 years, the investment will be worth about Shs200m in today’s money. This is based on the current rate of land. Just 15 years ago, a plot of land in some parts of Kampala was going for Shs3 million if bought from the real estate dealers. It was much less if you bought from the original family. Today, the same plot is approximately Shs100m. This means that a piece of land has been growing at Shs6.66 million per year. So 20 plots of land will be worth a minimum of about Shs4 billion in today’s money. To cater for taxes, commission, inflation and other stuff, you will need to sell another five properties bought between 2040 and 2045, which you would have kept for between 10-15 years. With a million dollars earning a net of about 6% per annum in financial markets, you will have US$5,000 per a month to ensure you don’t have to ever call your children for any money during retirement and create generational wealth for the grandkids. The writer is a communication and visibility consultant. djjuuko@gmail.com

July 9, 2020

News

#OutToLunch Let people buy their radio sets and face masks

By Denis Jjuuko When COVID-19 struck, the government promised some people food and indeed some households got. It somewhat showed a government that cared for its people even though the distribution was bogged. Even the biggest economy in the world, the United States, gave its citizens something with adults getting checks of US$1200 and children US$600. In Uganda, there were arguments that instead of food, people should have received money on their phones to boost spending to restart the economy. From free food, we were told of free face masks for everyone above six years old. Like it was with food, many people have never received their free face masks. Then last week, the government promised free radio and TV sets to enable kids to learn during the lockdown or enable politicians campaign now that the electoral commission is talking of campaigns carried over the airwaves. Ugandans are supposed to go to the polls next February. The newspapers said 10 million radio sets will be distributed each costing Shs38,000 or approximately US$10. Ugandan governments since independence have run a mixed economy. Providing free medical care in government hospitals and free education. With Universal Primary Education (UPE), a child can study for free up to university. Many farmers today receive agricultural inputs in seeds and other stuff to boost their income. I think some progressive farmers have made significant progress taking advantage of these freebies though the majority have remained dependent on the seeds. A face mask on average in Kampala costs Shs2,000, which is less than a US dollar. Even when the economy has been shut down during the COVID-19 pandemic, we should assume that the majority of people should be able to buy themselves a mask that costs that much. If they can’t and therefore need to be given free ones, then there is a major problem we need to address. There is a famous saying sometimes attributed to the Chinese that posits that it is more important to teach people how to fish than giving them fish. With face masks and free radios and everything free, we are giving people fish when they can fold their sleeves, get on a canoe and catch the fish themselves. If they learn how to fish, they can always get themselves what to eat. If we give them fish, they will be looking at us every few days even when the lake full of fish is just in their courtyard. We have had many poverty alleviation campaigns for many decades now, it is time to assess their impact. If these campaigns have had any impact, we shouldn’t be now thinking about giving out free masks and now free radio sets. Many years ago, people may have lacked TV sets (like they still do today) but most households had radio sets. How come today they must be given free ones? We should campaign less on giving people free stuff rather enable them to afford the basics of life. We should ensure that any household that needs a radio set worth approximately US$10 can have it by buying it themselves. The same applies to the face masks. This can be done easily by creating markets for mainly agricultural produce because the majority of Ugandans depend on agriculture. Many years ago, if you moved into an area where people, for example, grew coffee, you would find either a coffee factory or a store. It meant that people in that area had somewhere to sell their produce. Many people when they needed anything, they could simply present their delivery notes for credit just in case the factories hadn’t paid yet. People took their kids to expensive schools because of coffee and other cash crops. This is something that could be done again. The money that has been spent on free face masks and what will be spent on radio sets is approximately Shs500 billion. There are 134 districts in Uganda today. This means that Shs3.7 billion or approximately US$1 million per district. This is enough money to set up a project at least in one of the district sub-counties that can significantly, if well managed, change the lives of the ‘vulnerable poor’ in that area. If we continue tuning the mindset of the poor that everything will be given to them, nothing will change. The dreams we have of a middle-income country will remain just that — dreams. Of course, there could be people who benefit when people are so poor but we should not forget that the poor are the same people who will be used to challenge those who are currently benefiting from them. The writer is a communication and visibility consultant. djjuuko@gmail.com

June 25, 2020

News

#OutToLunch New KCCA team should prioritize easing Kampala traffic

By Denis Jjuuko Last weekend, a new team of executives was proposed by the President to lead the Kampala Capital City Authority (KCCA) after the resignation of Jennifer Musisi Ssemakula two years ago. The letter nominating the new team, which widely circulated on social media indicated that they should go through formal interviews I think as some form of legal measure. Their jobs are assured. I offer my warmest congratulations. I must admit that I am not sure what is entailed in their terms of reference but one area that is making Kampala ungovernable is the issue of transport. The outgoing acting team recently came up with taxi routes and numbers but I am not sure how they solve the city’s endemic traffic nightmare. It is unacceptable for people to spend 2-3 hours driving a distance of less than 20km — the same amount of time an average pedestrian needs to cover the same distance. So on average, people who work in Kampala lose four hours every day in traffic which translates to about 1,040 hours a year for those who work five-day weeks. Uganda’s economy is mainly based in Kampala and therefore makes losses of approximately US$800m or Shs3 trillion a year in gross domestic product according to the World Bank. KCCA itself carries this unwanted statistic on its website. There is a need to significantly consider public transport by implementing a multimodal mass transit system that can decongest Kampala. One of the ways Dorothy Kisaka, the nominated Executive Director for KCCA needs to look at is buses. The time for 14-seat passenger vans (taxis) is over. A bus with the capacity to carry 90 passengers can get 6.4 taxis and about 40-45 vehicles off the road. Private vehicles carry on average only two people. I know that Ugandans love cars but they do so mainly because of systematic problems in the public transport sector. Many cars for office workers are parked all day and they are expensive to buy, fuel and maintain. A reliable public transport system would see many people dump cars and free up their resources to invest elsewhere. On average, a reliable old car costs approximately Shs20m — enough money to start a sustainable business that can employ a few people. Buses offer the first step in this multimodal approach. Kiira Motors, a government entity, has developed capacity over the years to make vehicles. Their Kayoola EVS, fully electric, city buses could save Kampala from congestion as well as from the fumes of 15-year-old vehicles that dominate the streets. KCCA can easily organize taxi entrepreneurs to consider buses. They can give them incentives such as special lanes. A part of Kampala city roads is reserved for street parking. If we worked on our public transport, there would be no need for street parking since many people will be coming to the city by public means. The buses won’t need any parking as they would be consistently on the move whether with passengers or not. The spaces designated for street parking will then be made special lanes for buses. The same lanes for buses could be used by trams. The people who are currently employed in the taxi sector will still be employed on the buses and trams. In fact, more people will even get jobs. With buses in place, KCCA can go ahead and charge prohibitive fees to private motorists to enter the city. The parking fees can also be raised to deter street parking in the areas where bus lanes are not needed. Many people who drive private vehicles in Kampala as a form of transport easily jump on public transport vehicles while outside the country. If they can jump on trains and buses in London or Dubai, why can’t they do so in Kampala? If we make Kampala expensive for people to drive in, they will use public transport or force others to work from home. As COVID-19 has taught us, most office work can be done from home. During the lockdown, many people managed to accomplish their work from wherever they were. Once the lockdown was lifted, they went back to their routines. Many times people drive to Kampala for meetings, banking, and such other stuff that can be done online. Of course, it is always nice to meet people physically and establish proper relationships but such meetings should only be held when necessary. The writer is a communication and visibility consultant. djjuuko@gmail.com

June 18, 2020

News

#OutToLunch George Floyd, bank mergers and lessons for Ugandan SACCOs

By Denis Jjuuko As the United States of America was engulfed in flames following the killing of an African American, George Floyd, in police custody, an interesting story surfaced online. In the story, African Americans were urging each other to support fellow African American or black businesses. The story says black banks, for example, had experienced substantial increases in the number of blacks opening accounts. At the same time as this story was spreading, Bank of Uganda gave no objection to the merger of NC Bank and CBA Bank. Both banks are Kenyan owned and have been in Uganda for a couple of years but as small players. Their merger, we were told, has created a bank with assets worth more than Shs500 billion. The merger followed an earlier one in Kenya where both banks are headquartered. The merger in Nairobi created a behemoth worth US$4.4 billion or a whooping Shs16.2 trillion in Uganda currency according to Reuters news agency. This moved the two merged companies from mid-tier banks to the third-largest bank with more than 38 million customers. Before that, in 1991, in South Africa, some small banks merged to create the Amalgamated Banks of South Africa commonly known as Absa, which recently entered the Ugandan market by acquiring the assets of Barclays in Africa. The merger of small banks created a unicorn that is now a big financial power on the continent with a recognizable brand plate. These stories made me think about our SACCOs and investment clubs. There are thousands of them in Uganda with many assets releasing billions every week to millions of members but in such small amounts that they go almost unnoticed. What can they learn from the business lessons emerging from the death of George Floyd many miles away? What stories do they get from the merger of NC Bank and CBA Bank? These SACCOs and investment clubs have money in billions but they haven’t earned their place on the table. They are not controlling the economy. Many invest members’ savings in commercial banks earning a small fee on their fixed deposits. If they merged, they would become a force to reckon within the financial sector. They can start directing the economy. They can become banks though they don’t necessarily need to do so to create impact. There are many business models. Many SACCOs and investment clubs give members loans to buy imported boda bodas. How about funding a factory to assemble the boda-bodas? They would fully control the boda industry. A boda-boda costs less than US$300 in India but sold here at about US$1500. The SACCOs working together can change that narrative with their boda boda production plant. They already have the money; they just need the vision for big business. In many villages, there is what is called VSLAs or Village Saving and Loans Associations, which collect money every week. They enable each member to borrow and do their little business usually in the agricultural sector. How about if they simply agreed at a parish or even a sub-county level to change a little bit and decided to invest in one or two crops say the growing of onions. Such a village will be known for onions. It will attract onion buyers there and significantly reduce the cost of transport for onions. They would also collectively bargain for better prices as they would be a big force in the onions market. Government agencies such as NAADS will pay attention to this sub-county and probably set up a processing plant for them to add value to their produce. But if each member in the same village, parish or sub-county continues to grow their own crop on their own little pieces of land, they will remain poor substance farmers for life and the cycle of poverty will continue for generations. Many big companies also have SACCOs from which staff borrow to pay school fees, build rentals that bring almost zero returns and cry when jobs are shifted elsewhere. Yet some of the SACCOs can easily turn themselves into businesses that supply that very company where the members work. They can supply the company with raw materials if they are a factory or even consumables for offices. They can supply others as well. Of course, these ideas can only work if the SACCOs institute proper governance structures and have qualified managers in place. I believe that the money in SACCOs and investment clubs lying idle in fixed deposits and dormant land investments can easily create a revolution in this industry. We simply need to think like NCBA Bank or Absa before it. They can pull money to do big business like we are seeing African Americans learning from George Floyd. The writer is a communication and visibility consultant. djjuuko@gmail.com

June 12, 2020

News

#OutToLunch Ongoing URA changes should address SME challenges

By Denis Jjuuko Over the weekend, several senior managers at the Uganda Revenue Authority (URA) tendered in their resignations ostensibly to pursue other careers. Social media as is usually the case went overboard with some people claiming it was a purge that the officers didn’t choose to resign rather forced to do so. URA issued a statement saying the board made recommendations concerning the “reorganization and management” but “some senior officials chose to resign and the board accepted their resignation.” There is nothing new in mass resignations in organisations following an appointment of a new boss. However, what concerned me was the statement, which talked about “reorganization and management of URA” though my concern isn’t merely in the personnel, those can always be replaced. The way URA works is what needs to change and I hope the “reorganization and management” will consider small and medium enterprises (SMEs). There is a need to change or push to change the many taxes that end up strangling small businesses. The income tax rate is at 30%, excise duty at 15%, withholding tax at 6% and VAT at 18%. All these taxes may be fine for large organisations, but for small companies, they are a death sentence. So imagine a company that gets a Shs100m contract, runs to the bank to get a loan to execute the assignment and the loan is granted at 24%. If they pay all those taxes and the interest fee, what do they remain with? But before the company even gets a contract, it must submit a tax clearance certificate (TCC). Some years ago, URA people sat in a boardroom and came up with an ingenious idea —TCC must be issued per a bid. So if you are bidding for work in Company A today, you apply for a TCC that goes to Company A and if tomorrow you need to make another bid to Company B, you apply for another TCC. Never mind that you just got a TCC a day before. The funny thing is that today URA can issue you a TCC and tomorrow they can reject to give you one. I don’t know what makes URA issue a TCC today and refuse to issue another tomorrow. This process of applying a TCC per bid is another cost for SMEs because many rely on external consultants to process these certificates for them. Why doesn’t URA issue a TCC for say six months or one year? If they fear that SMEs will forge them, they can a create verification system. If people can quickly verify in whose name is a vehicle registered at URA, why can’t they verify whether a TCC is genuine or not? Taxes like VAT should also be reformed where SMEs don’t have to pay URA once an invoice is issued rather when they have been paid. I know there is an option for this but its administration is even more complicated than paying URA before a company is paid because you must have paid all your VAT before you allowed this option. Where does an SME get the money to pay taxes for money it is not sure will be paid on top of servicing loans at crazy rates? URA sometime back introduced a very good system where some types of businesses are charged a set rate as income tax. They call it a presumptive tax. Businesses like salons pay this rate instead of self-assessments. The figure payable is set regardless of the profit made. I think this is a very good way of taxing SMEs. However, they left out many businesses that could pay more taxes if they were asked to pay a fixed rate. Self-assessments are cumbersome to both the small taxpayers and URA. The URA needs many staff to look at documents before they accept that the self-assessment is correct. Many times, URA refuses self-assessments and institutes charges that are way above what an SME made in a year. That involves a lot of back and forth before the tax is paid if ever paid. There is a need to widen businesses that pay a presumptive tax rate but also consider the size of business. The other alternative is to have an income limit where, for example, if the business earns less than a certain amount a year is allowed to pay a presumptive tax than going through the cumbersome processes of self-assessment. This will reduce the number of companies filing zero profits and therefore paying nothing in income tax. Also, URA needs to handle SMEs differently. For example, the assessment forms for Withholding Tax exemptions shouldn’t be the same for all taxpayers. A simple form for a small business is sufficient whereas, for the largest taxpayers, they can have a form that fits their size. As URA was issuing statements about its staff resignations, MTN was issuing another regarding a tax case involving Shs326 billion which the telecom giant questioned in court. The assessment came to Shs24 billion but MTN further appealed to the Tax Appeals Tribunal. To cut the long story short, MTN got an interim order against the enforcement of URA notices. MTN as a large company can afford silver-tongued lawyers and appeal even for 20 years but SMEs can’t. A mere lack of a TCC is a disqualification from a potential contract. Excessive assessments from URA simply lead to heart attacks for the owners and closure of the business. URA enforcement officers also love small companies — they quickly attach bank accounts, put padlocks on the premises and such other things. For the big boys, they simply sit on the table or go to court. Changes at URA, therefore, shouldn’t stop at just personnel but the way tax administration is carried out especially for SMEs because they are the majority and employ more people collectively. Customer care is critical if URA is to achieve its tax targets and SMEs can play a critical role if URA invested time and resources to understand them and address

June 4, 2020

#OutToLunch Invest in electric vehicle charging stations

By Denis Jjuuko Since the lockdown, there has been a lot of talk in Kampala about the future of mass public transport. The construction or renovation of one of the taxi parks in the central business district has been a consistent reminder of transport in the city. The future of boda bodas in the city is another topic with some information from city regulators that all boda bodas must be registered on a mobile app as a form of regulation. The future of public transport in Kampala is always an interesting topic because there are many vested interests. Kampala though needs to think about mass transit systems as the current model has run its course. At four million during the day, the city population has greatly expanded causing traffic jams everywhere. One bus that carries 90 passengers can take 6.4 taxis (14 seats) and 40 private cars off the road. The jobs the taxi business creates today can be moved to buses but also taxis can service areas where they are none today. Most towns outside Kampala depend on saloon cars which are designed to carry five passengers including the driver but end up carrying 14 or more passengers. I think many people who use these saloon taxis end up with broken bones! On normal working days, it takes about two hours to cover a radius of about 10km by car, which is actually slower than walking on foot. The vehicles we drive in Uganda majorly come in extremely old from Japan leading to air population that is perhaps explaining the increase in many diseases that affect people who live and work around Kampala. As the talk on city transport was raging, Kiira Motors sent two of its fully electric buses that have the capacity to carry 90 people on the street. The talk doubled with many people excited about the buses. One of Kiira Motors’ buses called Kayoola EVS was assembled in Nakasongola at the UPDF’s Luweero Industries facility since the carmaker is still constructing its vehicle production plant. On a full charge, the bus covers 300km. But for me, the deployment of the buses on the street on an exhibition drive was significant in many ways one of which I want to talk about today — the possibility of electric vehicles and the opportunities they present. First, by Kiira Motors making electric vehicles, it means that eventually, the technology will become widely available and acceptable. When people are buying cars and indeed other assets, they think about after-sale service. So somebody who may want to buy a Tesla today will ask, will I be able to service it in Uganda? By Uganda making electric vehicles, it means that a significant number of jobs for mechanics will eventually be created to work on such vehicles. If Kampala goes ahead to have electric buses as the preferred mode of mass transport, it means that entrepreneurs can set up garages to provide after-sale service while others can create charging stations. I think charging stations provide very good entrepreneurial opportunities for those who want to dominate the post-COVID-19 market. Imagine if one set up stations in all major areas of greater Kampala like Mukono, Entebbe, Kyengera, Wakiso, Luzira and Ntinda among others, the returns would be good in my view. Eventually, many other Ugandans will start buying electric vehicles thereby creating a massive electric vehicle value chain. If you are thinking of where to work in the future, think about electric cars and go ahead and enrol for a course in such studies. Even the boda bodas will one day all be electric. The internal combustion engine has been on the market for over a century and so its time has come. With Uganda’s electricity generation capacity increasing by the day, this electricity needs to be channelled into one of the key sectors where Uganda has been significantly losing a lot of money. The biggest product imported into the country today is petroleum most of which goes into powering cars. On average, a car takes about two people in Kampala who spend a lot of time burning fuel in traffic jams. The deployment of Kayoola EVS means that entrepreneurs with their eyes on the future now need to move into this sector. The writer is a communication and visibility consultant. djjuuko@gmail.com

May 27, 2020

Out to Lunch: What Covid-19 teaches us about post-harvest handling

By Denis Jjuuko A poultry farmer somewhere in Uganda wakes up and looks at her chicken wondering what to do with it. She places a call to her customer to find out whether things have improved in the city. Lukaya and Namawojolo bus stops are empty, the customer says before adding that the hotels and restaurants are still closed. The farmer decides to reach for her savings for another sack of feeds. The birds must eat or else she will make a big loss. The cycle continues every week. In another part of the country, a Matooke farmer is calling his transporter asking whether he will take matooke. Being a transporter, he promises that he will do something about it. The farmer smiles and waits for the truck driver who never shows up. He simply has nowhere to sell the matooke but is too shy to tell the desperate farmer the truth. I can say that about almost everyone in the agricultural sector. I heard that dairy farmers are pouring the milk away! Although Covid-19 is exasperating farmers with dwindling markets, it has always been like this. In 2018, the maize market in Uganda crashed with a kilo going for a song. Two years later, with Covid-19 knocking on the door, terrified urbanites were buying a kilo of maize flour at almost a US dollar. Government, we heard, was buying at about US$1.5 a kilo as food for its “vulnerable poor.” Those who had kept the maize were in business. Those who are stocking maize now will make even more. We are in the middle of the planting season but with the lockdown, many farmers are going to be affected with little access to money to work on their gardens. With an economy projected to recover around 2022, many people will simply give up. Yet this shouldn’t be the case. This should be the time when people are busy in farms preparing food for the future. However, many farmers are discouraged because of the volatility of the market. Somebody plants tomatoes when the market is good and by harvest time, there are either no buyers or the returns are not worth the ink of this article. Frustrated, the youth come to the city to ride boda bodas. We need to use this period to think of post-harvest handling in our country. The poultry farmer shouldn’t be so worried about his broilers today if he could have them stored in a cold room or processed into some other products that extend its shelf life. The maize farmer with a facility to store his products wouldn’t be so worried when the market crashes. To be honest, organisations like NAADS have tried. The last time I was in Adjumani in West Nile, I saw a store where farmers keep their grain in some sort of plastic containers and bags where pests wouldn’t easily feast on them. A farmer keeps his produce there safely and decides when to sell. NAADS needs to have such projects in many other parts of the country. By improving post-harvest handling, farmers can have better prices which would in end attract more people to agriculture. Covid-19 has taught us that if there is a sector that can withstand lockdowns, it is the food industry. People have to eat and, therefore, we need to invest in it. In his book, Uganda:7-Key Transformation Idea, Buganda Katikkiro Charles Peter Mayiga argues that there is need to zone the country where one area could be known for a particular product. That would attract investments in that particular area. Collection centres would easily be set up in a certain area for a particular product. A market for a particular crop would easily be set up. Look at coffee, for example, it mainly grows in certain areas so it is easy for coffee farmers to get a market than those growing all sorts of stuff in their little gardens. The Food and Agriculture Organisation, a UN agency estimates that as much as 37% of food in Sub-Sahara Africa is lost between production and consumption. Our economy is essentially agro-based but we have been farming the same way we did before the European missionaries and Arabic traders arrived. We need to change and improve post-harvest handling which will increase value for our farmers. The writer is a communication and visibility consultant. djjuuko@primetime.co.ug

May 25, 2020