KAMPALA – The Economic Policy Research Centre (EPRC) has on Thursday hosted a National Validation Workshop for the Regulatory Impact Assessment (RIA) Report on the sugarcane sub-sector at Imperial Royale Hotel. This milestone event marked a significant step towards addressing the persistent challenges facing Uganda’s sugarcane industry.
Since liberalization, Uganda’s sugarcane production and processing have made notable strides. However, the sector grapples with equitable pricing, mill licensing, governance funding, post-harvest handling, prioritizing local investors, and climate change impacts. Despite regulatory efforts, including the 2018 and 2020 Sugar Acts and the 2023 Amendment Bill, key issues remain unresolved.
Sarah Sewanyana, Executive Director of EPRC revealed that in September 2022, together with other stakeholders, they identified regulatory, implementation, and governance gaps, highlighting strained relationships between millers and farmers. To address these challenges, technical staff from various ministries and agencies convened for a two-day workshop, culminating in a proposal to review the 2010 National Sugarcane Policy (NSP) and the 2020 Sugar Act. A Regulatory Impact Assessment was recommended to improve regulatory decision-making, promote good governance, and foster sustainable growth.
The November 21st workshop aimed to disseminate the RIA report findings, policy recommendations, and conclusions to obtain national consensus. Stakeholders, including farmers, sector representatives, civil society, and media, gathered to review and provide feedback on proposed policy and legislative options.
Sewanyana, emphasized that their sugar research project identified policy and regulatory gaps.
“During our comprehensive sugar research project, we uncovered significant policy and regulatory gaps. Seizing this opportunity, we positioned ourselves to address these shortcomings,” she said, noting that, “We’re pleased to have undertaken this RIA, which will enhance the regulatory quality of the sub-sector.”
according to her, the primary objective of this regulatory reform is to enhance the overall quality of the subsector’s regulatory framework, focusing on three key areas:
- Enhancing performance
- Improving cost-effectiveness
- Strengthening legal quality
“By undertaking this RIA, we aim to create a more conducive environment for the sugarcane industry to thrive.”
Minister of State for Trade, David Bahati highlighted Uganda’s remarkable progress in the sugar industry.
“We’ve come a long way since 1986, when we produced less than 100,000 metric tonnes of sugar. Today, we’re producing an impressive 600,000 metric tonnes. Not only that, but we’ve also diversified our production to include industrial fine sugar, which we previously imported at a cost of $200 million annually. Now, we produce 90,000 metric tonnes of industrial sugar every year, meeting local demands for soda and other products.”
He says that the sugar sector has been a significant contributor to Uganda’s revenue, growing from less than shs10 billion in 1986 to shs298 billion in 2023. Beyond economics, the industry has also created jobs for many Ugandans, both directly and indirectly.
However, Bahati cautioned small-scale farmers against venturing into sugarcane cultivation, emphasizing that large tracts of land are necessary for profitable production.
To regulate the industry, the government established the Sugar Act 2020, which introduced a sugar board and a pricing formula. While challenges persist, Bahati is optimistic that the forthcoming laws will address these issues.
First Deputy Prime Minister, Rebecca Kadaga, stressed that the sugarcane industry faces pressing challenges that jeopardize its long-term sustainability. These challenges include pricing disputes, inefficient mill licensing, inadequate farmer registration, post-harvest handling issues, and the devastating impact of climate change. Despite the introduction of frameworks like the Sugar Act 2020 and the 2023 Amendment Bill, significant gaps in governance implementation persist.
“To address these challenges, a comprehensive RIA is crucial. Unfortunately, the sugarcane sub-sector lacks a thorough RIA, hindering effective solution implementation. A systematic evaluation of our framework is necessary to identify and address these issues. The RIA process allows us to assess both positive and negative impacts, ensuring informed decision-making.”
She added, “I’m pleased to announce that our report will provide valuable insights for the government to leverage and drive meaningful change.”
Mugenyi Semeo, a local sugarcane farmer, expressed his gratitude to EPRC for their comprehensive study on the sugarcane industry.
“We appreciate the work of EPRC, as their recommendations offer a solution to our long-standing challenges. We hope the government will implement these recommendations,” he said.
He noted that one of the major challenges faced by sugarcane farmers is the unpredictable pricing system where millers arbitrarily decide when to increase or decrease the price of sugarcane, leaving them with little control over their livelihoods.
He hopes that the EPRC’s assessment will guide the sugar council in regulating sugarcane prices, bringing much-needed stability to the industry.
With the RIA report’s validation, Uganda is poised to address the sugarcane sector’s long-standing challenges. The EPRC, on behalf of the TWG, has paved the way for sustainable growth, improved governance, and enhanced regulatory decision-making.
