TRENDS AND IMPACTS OF FOREIGN INVESTMENT IN DEVELOPING COUNTRY AGRICULTURE

UGANDA
Trends and impacts of foreign investment in
developing country agriculture
FIGURE 8
Area under rice cultivation in Uganda,
1961–2007
production in Uganda. According to the FAOSTAT
database, between 1991 and 2005, among
seven major crops: coffee, maize, rice, cotton,
sugarcane, tea and tobacco, rice was the only
major crop to register a consistently positive
increase in the production area (Figure 7). Tilda
(U) Limited, a subsidiary of Tilda Limited, United
Kingdom, contributed to sustaining this trend.
After the company started operating in Uganda in
1997, the production area for rice increased from
60 000 hectares in 1997 to 119 000 hectares in
2007 (Figure 8).
Negative impacts
The considerable number of large fish processing
companies has contributed to the high demand
for Nile perch fish, which in turn has led to
the depletion of Nile perch fish stocks in Lake
Victoria. Although fish is a renewable resource,
there should be mechanisms in place to ensure
that this resource is continually replenished.
Uganda does not have export quotas for the
fish sector. Fish is harvested mostly from Lake
Victoria and fish stocks are replenished seasonally
in line with natural fish breeding patterns.
Therefore, overfishing (in that the quantity of fish
harvested exceeds the new fish bred in a given
142
Production Area (Ha)
120 000
100 000
80 000
60 000
40 000
20 000
0
1961 1965 1970
1975
1980
1985
1990
Rice
1995 2000 2005 2007
Source: FAOSTAT database, downloaded on 10 February 2009
season), or harvesting of immature fish are likely
to result in a decrease in fish stocks.
In the fish export sector, between 2001 and
2004 the quantity of fish exported increased
considerably to about 30 000 tonnes from an
average volume of 15 000 tonnes in previous
years, 1995–2000. The increased quantities of
fish have exerted pressure on the existing fish
exporters to either close operations or expand
to other landing sites to maximize their catch, as
discussed earlier. The volume of fish exports from
Uganda declined from 36 614 tonnes in 2005 to
22 731 tonnes in 2008. It is important to note
that fish companies are not directly engaged in
fishing activities. Instead, they contract fishermen
and other suppliers to supply fish to their
processing plants.
6.3 Impact on agricultural exports
Uganda exported commodities valued at
US$889.43 million in the financial year,
2005/2006 (Uganda: Background to the
Budget 2007:18). Exports of the three selected
commodities (coffee, flowers and fish), where
TNCs are dominant, accounted for 39.1 percent
of that total value.
FIGURE 9
Relationship between quantity of fish
harvested and number of fish factories in
Uganda, 1995–2008
Tonnes Numbers of factories
40 000
35 000
30 000
25 000
20 000
15 000
10 000
5 000
0
1995
Quantity of Fish
2000
2005
Number of Factories
5
2008
Source: Uganda Fish Processors and Exporters Association, 2009
20
15
10