Uganda has neither improved cotton production nor made much headway in adding value to the crop in the last decade, the auditor general has observed.
Consequently, areas that traditionally grew the crop in northern and eastern Uganda have either shifted to other crops or have had to do with low production that has hardly improved their incomes.
In a report dated December 2016, which is before parliament for scrutiny, the AG says the sector’s potential for production has not been realised.
The Cotton Development Organisation (CDO), the body overseeing the sector, has had little if any impact on the fortunes of the sector, the audit noted.
He notes that actual lint production was below target by 247,381 bales, 371,636 bales, and 406,907 bales in financial years 2012/13, 2013/14 and 2014/15 respectively.
The acreage under cotton production has not increased either. The report observes that production levels have been below official target since 2012/2013.
“The cotton production levels attained were below the sector production potential,” said the audit.
“[There
have been no] conclusive solutions to the challenges of access to
production inputs by farmers which affected the output from the farmers,
and the broader cotton production targets as spelt out in the CDO
strategic plan.”
According to the AG’s report, CDO had, on average, asked for Shs 18bn between financial years 2012/2013 and 2014/2015 to implement activities such as the establishment of additional spinning capacity and support to financing of buffer stocks for cotton seed oil industries.
Government, however, could only provide an average of Shs 4.5 billion over the three financial years. Much of this money went into paying salaries.
The audit notes that while there have been interventions to push for value addition on cotton, they have remained largely on paper.
“Consequently, an average of ninety-five per cent of all the lint produced in Uganda was exported without any form of value addition, and the envisaged sector earnings for both farmers and dealers in cotton products were never realised,” the report said.
Cotton in Uganda was among the three Cs – coffee, copper and cotton, which the country became famous for in the colonial time.
In the 1980s, the burden of war as a result of the messy politics at the time and limited government attention saw the production of the crop drop substantially.
As President Museveni signed up for the African Growth and Opportunity Act (Agoa) in 2001 to enable the exportation of apparel to the United States of America, it was majorly assumed that Uganda would have an advantage because it had the best quality of cotton. However, there have been no notable exports to the USA.
In 2014, President Museveni launched Fine Spinners, a Kenyan firm, which he said would help add value to cotton. The AG notes, though, that while government spent Shs 10bn to procure buffer stocks to feed the firm, it could not utilise those it had purchased as it had delayed to put up machinery to process it.
“The level of value addition to Uganda’s cotton has remained very low due to non-implementation of interventions proposed in the strategic plan and the textile policy,” the AG said.
The National Textile Policy of 2009 has had no impact as its provisions remain unimplemented. This trend of events is visible in export figures. Bank of Uganda says while Uganda exported cotton worth $85m in 2011, it could only manage about $31m in 2016.
And since 2014, the country has not exported any cotton liners, the central bank said. The country has not added any value to its cotton since 2010. In 2009, the country earned $180,000 in textile exports, though.
That the country can hardly improve cotton production is testament of how things – especially in agriculture – have degenerated with no visible changes in the last couple of decades.
Together with the EAC partner states, Uganda is mulling over an idea to ban the importation of second-hand clothes to boost local industry.
The AG’s audit shows there is a lot that needs to be done to push up production and facilitate value addition before the ban is thought about.
