President Museveni has said Nestle group, a Swiss multinational food and drink processing conglomerate, refused to build a coffee processing plant in Uganda.

Museveni said he wrote to former Finance Minister Mayanja Nkangi in 1997 urging him to support efforts of adding value to raw coffee to attract more money from coffee exports.

“After that, I engaged the Nestle group in Davos.  They made  it  clear  that  they  already  had  their  factory  for coffee processing in the UK and would not build a new one,” said Museveni on Sunday during the Independence Day celebrations.

“Hence,  we  had  to  remain  as  Raw-Material producers, getting only 5% of the value of the coffee we grow,” he emphasized.

“They (Nestle),  moreover,  try  to  muddy  the  water  by claiming that “blending” of the different coffees can only take  place  in  Europe  etc.”

Museveni said he told Nestle that “Uganda had  all  the  varieties  and  the  blending  would  be  done here.”

The global value for trade in coffee is US$460billion.   

However, the  coffee-growing  countries  get  only  US$25billion  and  Africa  gets  US$2.5billion. Uganda  takes home US$800  million. 

Government recently advertised calls for companies to invest in processing coffee to a soluble state. 

Experts say processing coffee is not enough for Uganda to fetch better prices from the world market.

Andrew Rugasira, a coffee farmer and exporter recently said Uganda needed to develop first-class logistics and supply chain systems that get the coffee in and out, fast. 

He said modern countries have “invested billions in roasting capabilities over the years and there are over 1,600 coffee roasters in Germany, the largest of which are Tchibo, Jacobs, Dallmayr and Melitta that dominate the market for roasted coffees in the world.”

He added: “We need to consolidate our value-addition efforts by providing industry players with critical market knowledge, support their brand initiatives through aggressive trade promotions and distribution partnerships (fund these as Colombia and Brazil do), better logistics infrastructure and engage in aggressive commercial diplomacy where we have entry opportunities (as China, the EU and the USA do).”

Rugasira also said “the only way value addition translates to higher producer prices is when producers/farmers are organized, capitalized and control as much of the value chain processing as they can and by developing a vibrant and robust domestic consumption market.”

Museveni had tried to quietly support the Vinci company for the coffee processing deal which met stiff resistance from lawmakers.

“That has been the war I have been involved in until I got the Vinci Company to help me.  You heard how  some  of  the  MPs  were  talking  in  that  war,” said Museveni today.

The President said former Tanzanian President  Mwalimu Julius Nyerere had built a coffee processing factory  in  Bukoba  near  the  border  of Uganda. 

“When I heard of that, I linked our people with that effort.  They were producing an end product known as  “Star  Coffee ”.    Unknown  to  me,  the  officials  of Uganda,allowed  that  effort  to  die  out  or  get  stunted.  What blindness and betrayal this is!” said Museveni.