Uganda: Fear As Tobacco Company Shuts Offices

Source from:  The Monitor 02/06/2012

Hoima/Arua - Continental Tobacco Uganda Ltd offices in Arua have closed amid allegations that the company owes farmers at least Shs5 billion. According to Mr Caleb Kamure, a resident of Arua, "the money is payment for tobacco supplied by farmers in the two regions to the tobacco company from last year." He explained that last year, Continental offered high prices for tobacco as compared to its competitors, British American Tobacco and Leaf & Commodities (U) Ltd. Duped? "This lured very many farmers into selling their tobacco to the Kenya-headquartered company. But after paying a very small amount of what they owed the farmers, the company failed to pay the balance," Mr Kamure said. But Mr Mariku Mwangi, the acting General Manager Continental Tobacco Uganda, in a telephone interview with this newspaper this week, denied the reports that they had shut their offices in Arua. He, however, acknowledged that the company owes farmers money, arguing that they are meeting Ministry of Trade officials to agree on how they are going to pay the farmers. Last year in March, the same company failed to meet an ultimatum to pay a Shs320 million debt to farmers in Hoima District, forcing them to appeal to the deputy Resident District Commissioner, Mr Abdul Swamad Wantimba, for help. When summoned, the company head in Hoima, Mr Samuel Sumuni, claimed that the payment process was delayed by the company's head office in Kampala. He promised that the money would be ready within a few days. Money search Mr Tom Aguyo, the chairperson of the Tobbaco farmers union in Arua, and his secretary have reportedly travelled to Kenya to look out for the owners of the exporting company so that they can get their money. Mr David Owule, an official of the Ministry of Trade, said the Agriculture minister was to meet with the company heads yesterday to forge a way forward. Enditem