By Jane Uwimana

During a recent “Making Finance Work for Africa” conference in Kampala, finance institutions were asked to work together with governments in order to support farmers financially and provide easy access to loans.

Policy makers and farmers highlighted the need for better infrastructure and market policies to support the agriculture business in Uganda and Africa in general.

Gerald Sendawula is one of the big grain farmers in the Ugandan village of Lwamagwa. He borrowed money to finance his operations, but had trouble making repayments when a bumper harvest saw price levels drop.

“Maize was selling only for 30 shillings when we have delivered it all the way from Lwamagwa to grain milling in Jinja,” Sendawula says. “At the end of the day I failed to repay that loan because I took the loan when the cash flow, my projection, was on a hundred shillings per kilo. So here I am ending up having to deliver the maize to grain milling in Jinja and I get only 30 shillings per kilo”.

Warehouses are needed 

Farmers like Mr Sendawula say the construction of warehouses would prevent such losses, and that storage should be given priority in the government’s national agricultural support program – NAADS.

“The part of the money which is put under NAADS …should be made available in the grain area so that that money can build the necessary stores and people will be encouraged to produce,” he says. “Because I will know that if at the time of getting the product, harvesting  the price are very low I can afford to (NOT) take that low amount but store.”

Government says it works

Speaking on the sidelines of the recent conference, the Ugandan minister of state in charge of investment, Aston Kajara, said the government is working with the private sector to promote commercial agriculture.

“85% of our population depends on agriculture and yet the government has not found the investment to put into that area,” Kajara says. “So what we have done is we’ve been looking for partnerships with banks and partnerships with other stakeholders, partnership with donors to enhance the funding element so that our population, who are very committed farmers at subsistent levels, who don’t have sufficient funds, can benefit.”

Beyond the borders

Looking beyond Uganda’s borders, policymakers say efforts to boost productivity must go hand in hand with improved market access for farmers.

“The challenge is if you have increased production what happens to the markets?” says Boaz Blackie Keizire, an agriculture advisor from the African Union Commission. “We have worked with countries to work on what we call the caterpillar two. Which is on market access and market integration to make sure that whatever is produced has access to the market. We support the member states to develop their country investment plans.”

Food shortages still 

Food shortages remain a major concern for much of the population. John Agaba, the head teacher at a boarding school in Uganda’s south-west told The Daily Monitor newspaper that high food prices were making it difficult for the school to feed its students. He said the government should control the exportation of foodstuffs to neighboring countries like Burundi, Southern Sudan and the DR Congo to ensure the domestic market is served first.

Listen to the radio report below:

Ugandan Farmers Need More Infrastructure to Succeed by financeafrica

By Elidad Kabura

Seventy kilometers west of Uganda’s capital Kampala, Mityana district is known as one of the country’s coffee production center. Here, 3,500 coffee famers have decided to put efforts together to market their coffee. They have formed the Uganda Coffee Farmers Alliance through which they solicit good prices for their harvest.

One of the farmers, Sandra Musoke, who owns 10 acres of coffee plantation, says she first puts her coffee in a nursey for 9 months after which she transfers the plants to the main field. Sandra says that 5 years ago, she did not have the power to market her own coffee and would end up with harvest spoils, which automatically brought her financial losses.

However, she now stands with much confidence, which she says she developed after joining Uganda Coffee Farmers Alliance that has not only helped her coffee reach the international market, but also assured her of much better financial returns.

Finance literacy for farmers

Under this organisation, coffee farmers like Sandra have been trained in financial literacy. They receive frequent lessons on what kind of loans they should take and what it takes to be a borrower. The alliance also gives guidelines on which financial institutions the coffee farmers should approach and come in to mediate in any financial problem that may erupt between the two parties.

The banks on the other hand have uplifted their trust on the farmers under the alliance and can now comfortably credit individuals, a situation that was absent before.

The alliance also ensures that the famers maintain the quality of their production so that they can maintain the prime price paid internationally. This kind of alliance, however, is still lacking in other parts of the country where other coffee farmers are still exposed to the challenges of getting into the market on an individual basis.