name of presenter: connie magomu masaba ministry of agriculture- uganda impacts of large scale...

Name of presenter: Connie Magomu MasabaMinistry of Agriculture- Uganda

IMPACTS OF LARGE SCALE LAND-BASED INVESTMENT, IMPLEMENTATION CHALLENGES, AND POLICY

IMPLICATIONS; LESSONS FROM THE UGANDA OIL PALM PROJECT

GLTN BRIEFING AND PROGRAMMEGLTN BRIEFING AND PROGRAMMEGLTN BRIEFING AND PROGRAMME

• Challenges of smallholder agriculture

• Why Large Scale investments/ Why the Oil Palm PPP

• Project Background

• Establishment of the Oil Palm PPP model

• Impacts of the Oil Palm Project

• Challenges

• Policy Implications

CONTENT

Partner Logo 1 Partner Logo 2 Partner Logo 3


• Low production and productivity,• Low funding of the sector• Lack of agricultural financing/credit• Declining soil fertility• High losses due to pests, vectors and

diseases• Uncertain land rights• Complying with international quality and

safety standards

• Inadequate value addition and marketing infrastructure and road network

• Lack of mechanisation and irrigation

CHALLENGES FACED BY THE AGRICULTURAL SECTOR IN UGANDA


• To attract the much needed investment in the sector ,

• Private sector not confident that smallholder farmers can be trusted to deliver

• Ensure supply for the factory• Nucleus estate a source of technical know

how, inputs, mechanisation and value addition

• Assures commitment by the private sector that invests in R&D

• Efficiency in production • Job creation

WHY LARGE SCALE LAND INVESTMENTS IN AGRICULTURE


• Annual per capita consumption is 4.3 kg Vs global average of 22.4kgs

• Annual demand is about 120,000 tonnes Vs production at 40,000 tonnes. (Imports at USD 177 million in 2011).

• High poverty levels, high importation of vegetable oils (85 -90% ),

JUSTIFICATION FOR OIL PALM DEVELOPMENT


Goal: poverty reduction in the project area.Objectives:

• Import Substitution. • Rural poverty reduction in project area

through raising farmer incomes • Improve population health through

increased intake of vegetable oil. • Export Diversification.

GOAL AND OBJECTIVE


• IFAD Loan (USD 52M), • GOU (USD14M), • Private sector (USD70M), • Farmers (USD3.9M) • KOPGT (USD3.0M), • Reflows (US 4.4M) • Total funding USD 147million

INVESTMENT COSTS


• GOU advertised the tender - Transparent process of getting private sector partner

• Agreements in place with secured interests of both farmers and the private sector partner and Government

• Sensitization and involvement of the communities from start of project

• Private partner with the interest of the community at heart

• KOPGT established and mandated to manage the oil palm establishment and market for smallholders

ESTABLISHMENT (PPP)

GLTN BRIEFING AND PROGRAMMEIMPACTS SO FAR

Farmers:Increased incomes ($390/month per Ha for mature plantations)Improved land rights (landless and women, purchase of land, demonstration of legitimate access to land)

Community:Creation of employment (2,000 employed on nucleus estate, 500 in farmer gardens and 1,610 directly as farmers of which 583 women)Improved infrastructure (e.g. 750 km of road network and ferry service) and services (e.g. financial and public)Production in other crops, livestock and complementary agricultural activities, tourism and other non-agricultural enterprises is expanding

Government- Ush100billion +, new enterprise, use of land underutilized before, poverty reduction, attraction of other private sector – KIS, less pressure on the lake and forests for income

GLTN BRIEFING AND PROGRAMME

Challenges

• The Land question in Uganda which make access difficult• Philosophy of public sector different from that of Private sector-

Social good Vs profit maximisation.• Bureaucracy in the Public sector causes delays yet time is money.

Systems seems to be more valued than end result.• Attracting private sector financing into agricultural sector not easy due

to long pay back period, risk associated with agricultural investments and markets

• Finding credible investors willing to invest is challenging• Negative publicity and international debate on land grabs that is

associated with agric investments is a turn off for investors.• Quality and safety issues associated with smallholder farmers

discourages partnerships with them.• Suspicion among the partners especially smallholders assuming

that they will be taken for a ride by big investors

GLTN BRIEFING AND PROGRAMME

Policy Implications/Lessons Learnt

•Govts should determine areas of investment to ensure development of the communities•Involve host communities as activities partners with clear benefits to them, including equity share.•Guide on the valuation of community contribution in terms of land•Provide meaningful employment for the communities•Ensure that the promises made at design of the investment are met/realised•Put in place a monitoring and evaluation system for the investment to provide required numbers•Provide supporting infrastructure that benefits the general economy of the host community.•Stay active in the investment 4Ps( Public, Private, Producer Partnerships)•Strengthen the farmer organisations to be strong business partners able to negotiate and also take up their part of the risk.•Involve the communities early in the planning process

Ministry of Agriculture, Animal Industry and Fisheries

Vegetable Oil Development Project

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IMPACTS OF LARGE SCALE LAND-BASED INVESTMENT, IMPLEMENTATION CHALLENGES, AND POLICY IMPLICATIONS; LESSONS FROM THE UGANDA OIL

PALM PROJECT

NEED TO KNOW MORE?Connie Magomu Masaba

[email protected]@yahoo.com

name of presenter: connie magomu masaba ministry of agriculture- uganda impacts of large scale...

Documents

programmegltn briefing

agriculturegltn briefing

ugandagltn briefing

objectivegltn briefing

investment costsgltn

oil palm establishment

agricultural sector

private sector usd70m