Uganda: Tobacco Firm Operations Stopped

Source from:  The Monitor 06/07/2011

Kanungu - A new tobacco company that has been registering farmers to establish its operations in Kanungu, has been ordered to halt its operations. Kanungu District officials and tobacco regulators last week declared operations of Continental Tobacco Uganda (CTU) Ltd illegal. The company has been advised to first align its operations with the law and seek relevant permission from the tobacco regulator before operating in the area. The pronouncement came last week during a meeting between Kanungu district leaders, farmers and tobacco industry players. The meeting heard that CTU has since the beginning of this year been illegally contacting tobacco farmers as well as opening up sites for the new season starting this month, without clearance from the Trade ministry. Mr Fred Tiwangye, the tobacco inspector for North Kigezi area, told the meeting that tobacco production is highly regulated because the crop is a drug. Individuals and companies with intentions to join this business have to first seek and get clearance from relevant authorities, said the official. Earlier problems "This very company has been having problems with farmers in Bunyoro and Arua and now they are rushing to this district without clearance from the Ministry." He was referring to a number of media stories that CTU owes tobacco farmers hundreds of millions shillings after taking their crop on credit and failing to pay for it for over a year. CTU official, Mr Francis Karuiki, had it rough as he attempted to convince the meeting that his company was not yet operating. "We were invited here by some farmers and we are simply trying to do a survey. If we are not cleared to operate here, we are not willing to come to such a small region to start a fight," he said. Not against CTU Kanungu District's Assistant Chief Administrative Officer, Mr Silver Turyahikayo, and the district Vice Chairperson, John Muhima, told the farmers at the Thursday meeting, that the district was not necessarily against CTU or having competition in the area. He said they needed peaceful business. The tobacco inspector warned the district officials not to be misled into granting permission to tobacco growers or traders, saying that mandate is solely the preserve of the Ministry of Trade because of the sensitivities attached to the tobacco product. Enditem