Can you give us an overview of the history of Southern Range Nyanza since its founding?

Southern Range Nyanza was formerly Nyanza Textile Industries and was taken over from the government of Uganda in March 1996, after starting as a government company in 1954. Since the takeover, the company has experienced a remarkable 180-degree transformation. Today, it employs nearly 3000 Ugandans and is primarily engaged in the vertical processing of cotton and blended fabrics. 

In addition to fabric processing, the company manufactures various garments and serves local and regional markets. We have also started exporting armed forces uniforms to Equatorial Guinea. The anticipated growth in the textiles sector is closely tied to the implementation of the African Continental Free Trade Area (AfCFTA). The annual turnover of Southern Range Nyanza has reached $30m.

What has been key to the company’s transformation and how have investments ensured its success to-date?

The company’s transformation has been multi-layered. Initially, our focus was on fabric manufacturing, but we diversified our product range and expanded by establishing a garment division. We also entered the medical subsector, producing personal protective equipment (PPE), including masks and medicated cotton wool, during the Covid-19 pandemic.

Substantial investments were dedicated to modernising our machinery, positioning us as one of the most technologically advanced textile companies in East and Central Africa. We have replaced outdated equipment with cutting-edge technology from the EU and Japan, enhancing our ability to serve a broader market.

Notably, our medical division required a $6.5m investment to establish robust capacity for medical sundries manufacturing, with partial financing originating from Afreximbank. Over the past five years, our annual investments have ranged from $6.8m-10m, facilitating the acquisition of state-of-the-art machinery, including rapier weaving looms from Italy and weaving machinery from Germany.

What are the current production capacities for the garment and medical divisions, and what lies ahead for the PPE division?

In fabric production, we make 30 million metres annually. For the garment division, we produce 25,000-35,000 T-shirts and 2500-5000 sets of armed forces uniforms per day. In the medical division, we manufacture 1.5m packages, each containing 500 kg of medical cotton wool per annum, sufficient to fulfil national demand. We are aware that PPE is cyclical by demand, however, we plan to expand our PPE production across sub-Saharan Africa via the AfCFTA. This expansion is set to begin in the first quarter of 2024, and are active in discussions with various governments, with support from the government of Uganda to diversify exports.

In the future, how does the company plan to enhance value addition in the cotton subsector?

Our vision is to significantly enhance value addition within Uganda’s cotton subsector. Currently, only 10% of the cotton produced undergoes value addition, with the remaining 90% being exported as raw lint. In 2021 Uganda earned $29.1m by exporting 90% of its cotton lint. In contrast, we processed just 5% of the lint but generated $30m, highlighting the incredible potential in value addition. To capitalise on this, we’re committed to investing $30m to establish a 25,000-spindle spinning unit, which is the first step in the value chain. We anticipate beginning this project in 2024 and completing it by 2026. Once operational, this single plant will consume 30% of Uganda’s cotton lint, with an export earning potential of $17m annually.

Our perspective is that Uganda should actively attract more investors of this calibre to achieve comprehensive value addition. With 20-30% of Uganda’s cotton lint being processed by a few major investors, we can unlock the sector’s potential to reach $500m in export earnings.

How will the company utilise its strategic initiatives to grow in the next five years?

Our outlook for the next five years revolves around strategic planning and expansion. First, we are bolstering our production capacity with substantial efforts. Second, we’ve established a dedicated export division with a primary focus on expanding our African presence. Third, we are actively seeking strategic collaboration with the public sector, similar to our recent partnership in Equatorial Guinea, with plans to add three more countries to our portfolio within the next six months.

Our assessment of the future is remarkably optimistic. We aspire to become a $100m company within the next five years and aim to elevate our value addition from 5% to 30%, both of which have been progressing as planned.

What operational benefits within Uganda are expected following the integration of Africa Global Logistics (AGL) into Mediterranean Shipping Company (MSC)?

The integration of AGL into MSC represents a significant development for us. MSC is the largest carrier globally. We had the opportunity to connect with MSC during the annual summit of the Africa CEO Forum in Abidjan in June 2023. MSC is quite enthusiastic about opportunities in Africa, and we were viewed as a partner with the best infrastructure and knowledge of Africa to assist them with their growth plans across the continent.

The integration was not a sign of weakness by AGL, rather a strategic move to enhance our capabilities. We anticipate that one of the primary advantages will be access to MSC’s extensive resources. We will be able to tap into their global network, financial strength and infrastructure, undoubtedly boosting our Ugandan operations and throughout Africa. Moreover, we see great potential in connecting Africa with Asia, Europe and the US, which opens up new horizons for logistics across continents.

AGL retains its independence, giving us the flexibility to work with various partners like CMA CMG Group, Maersk and others. AGL even operates depots for carriers such as Ocean Network Express (ONE), Hapag-Lloyd and WEC Lines. This flexibility allows us to cater to a diverse range of customer needs. Integration provides a robust framework for delivering efficient logistics solutions, which will be a significant boon for AGL’s operations in Uganda and beyond.

What recent developments and investments has AGL made?

Our recent investments include the construction of a 10-acre facility with 10,000 sq metres of warehousing and a capacity to store over 650 twenty-foot equivalent units (TEUs). Located in Namanve, the facility is strategically located near major coffee exporters in the Central region of Uganda. The location allows us to be closer to our clients, particularly in the coffee export subsector, where demand for logistics services is high.

Additionally, we have acquired 25 new trucks and trailers to strengthen our presence in the oil and gas sector. These investments are significant, both in terms of infrastructure and fleet expansion. The total investment for these projects, including equipment and training is approximately €2m. We are dedicated to modernising our operations and improving our logistics capabilities.

We have already started working on our new inland container depot (ICD) in Namanve, with phase one focusing on laying the groundwork. Phase one is expected to be completed by November 2023, and phase two will involve preparing the yard for container reception and constructing the warehouse. We anticipate phase two to be completed by the end of 2024, possibly early 2025. The estimated projected investment for the new ICD is €8m-10m. Lastly, we are investing in renovating our office to create a more engaging and collaborative work environment, with the aim of boosting employee satisfaction and productivity.

Which specific sectors are you planning to prioritise in the future?

Currently, our company maintains a dual focus, operating within both the oil and gas sector and the traditional business sector. To streamline our operations, we have established a subsidiary, Integrated Logistics Services Tilenga, dedicated to managing ongoing oil and gas projects. While we are committed to the success of this sector, we also recognise the fundamental importance of our traditional business. 

Our traditional business serves as the foundation of our organisation, covering essential operational costs and generating additional profits, while the oil and gas sector represents an exciting growth opportunity. We are actively reinforcing our sales team and expanding our workforce to ensure the continued development and prosperity of both sectors.

What’s the future outlook for AGL’s operations in Uganda over the next 2-3 years?

I see AGL Uganda making significant progress. Over the next 2-3 years, our operations will continue to improve. We anticipate implementing better systems, introducing new developments, and enhancing our customer service. Given the dynamic nature of the business environment, we understand the need to remain flexible and prepared for sudden changes, such as blockages or strikes. By investing in our teams and providing them with the right tools and environment, we are confident that we will achieve our growth goals. Specifically, we aim to increase our market share from 6% currently to reach 8% or 10% within the next two years.

Lt. Gen. James Mugira, Managing Director, National Enterprise Corporation (NEC), talks to World Business Journal about NEC’s new initiatives, including a draft masterplan for an industrial park at Kakooge, and the construction of its one-of-a-kind electronic-waste facility in Kampala.

“We are proud to introduce our innovative electronic-waste facility in Kampala, a one-of-a-kind initiative in East Africa.”

Lt. Gen. James Mugira

Managing Director, National Enterprise Corporation (NEC)

Could you provide an overview of the National Enterprise Corporation (NEC)?

The NEC is the commercial arm of Uganda Peoples’ Defence Forces (UPDF) and was established by the NEC Act, 1989 (Chapter 312). It operates as a holding company overseeing subsidiaries such as Luwero Industries, NEC Construction, Works and Engineering, NEC Agro SMC, NEC Farm Katonga and NEC Uzima. We have recently expanded our portfolio to include NEC Security Services.

NEC has strategic joint ventures with Kyoga Dynamics, NEC Pro Heli International Services, Bosasy Luwero and NEC-Streit (U), to address both military and civilian needs effectively. NEC also plays a pivotal role in fostering economic growth, innovation and national security within Uganda.

In what projects is NEC involved within various sectors and how are these projects contributing to Uganda’s development?

First, NEC, through Luwero Industries, is deeply committed to contributing to national security by fulfilling its obligation within the realm of the country’s defense industries. Second, NEC is committed to Uganda’s food security agenda, in which we play a central role in enhancing food accessibility, affordability and nutritional quality in Uganda. This includes our exclusive provision of maize meal to UPDF; our efforts in staple food cultivation on 20.7 sq kilometres on NEC farms; and our collaboration with the Egyptian Armed Forces to enhance livestock conditioning.

Additionally, NEC is the largest supplier of fertiliser for Uganda’s Multisectoral Food Security and Nutrition Project (UMFSNP). We are investing in advanced post-harvest handling systems and state-of-the-art grain storage silos that will be available in Bweyale in the midwestern part of the country.

In the construction sector, we are contributing to the government’s strategy to establish a competitive state construction company. We have been entrusted with constructing the Kiira Vehicle Plant, a groundbreaking project. Additionally, we are involved in road and railway projects in partnership with Uganda National Roads Authority (UNRA).

In the oil and gas sector, we have established a strategic joint venture with China Oil HBP Group. Together, we have commenced the construction of a cutting-edge waste management plant for CNOOC in Kikuube District, with an anticipated completion date set for 2025. Additionally, we are proud to introduce our innovative electronic-waste facility in Kampala, a one-of-a-kind initiative in East Africa. The already operational facility targets responsible e-waste collection and management.

Can you provide an update on plans for establishing an industrial and business park in Kakooge?

The industrial park project is an exciting development for us. We have acquired approximately 2.6 sq kilometres in Kakooge, around 100 km along the Kampala-Gulu highway, and will be known as the T6 Industrial Park.

We have already taken important steps in its planning. We have developed a draft masterplan, which divides the park into five sectors: heavy manufacturing, light manufacturing, garments, agriculture processing and medical industries. Over 4000 sq metres of land have been allocated to the Ministry of Science, Technology and Innovation for the establishment of a vaccine production facility.

Currently, we are in the process of engaging with various stakeholders and mobilising resources with the goal of commencing construction in the current FY2023/24. We are actively working with relevant authorities on infrastructure requirements such as roads, water and power. Furthermore, we are exploring potential partnerships with foreign investors to support this project.

What will NEC’s role be in the next 3-5 years?

As a government entity with commercial objectives, our strategic direction is intricately tied to the government’s goals, notably Uganda Vision 2040, which seeks to elevate Uganda to a middle-income country by 2040. Over the ensuing 3-5 years, our primary focus remains aligned with the Third National Development Plan (NDPIII). As a state-owned corporation, our activities and vision are steadfastly guided by these political and economic directives.

Within the defence industries, our commitment extends to championing research and development and technology initiatives that bolster the capabilities of the National Army. We continuously monitor global advances in military technology, striving to adapt and innovate for the benefit of our armed forces.

Furthermore, we are deeply invested in augmenting value across various sectors, with a particular focus on enhancing food security. Within the food sector, we are pursuing initiatives to elevate food processing and value addition, fortifying the food security landscape. This strategic approach entails exploring avenues for value addition to agricultural products.

Pearl Marina Estates, sited on the Garuga Peninsula, Lake Victoria in Entebbe, is an ambitious mixed-use development which developer, Centum Real Estate, says represents “a monumental leap forward for Uganda’s real estate sector.”

The project, covering nearly 400 acres, is being created with more than 3 km of lakefront views and is located 22 km from Entebbe International Airport and 32 km from Kampala. 

The sleek masterplan shows a wide variety of residential types, a marina, and ample peripheral service buildings, all curving around the peninsula. 

When finished, the Marina will encompass a variety of housing options from around $34,000 dollars for a studio  through three-bedroom bungalows at $280,000 to $330,000 for four-bedroom villas with a maid’s room. Everything is to be integrated into recreational, social and retail facilities. 

Residents will have access to such facilities as, landscaped gardens, swimming pools, clubhouse, a beach, the lakeside boardwalk and beach club within the Pearl Marina Estate.

“Our vision is to craft a sustainable city that allures both residents and businesses,” says Raphael Nyamai, the General Manager of Centum Real Estate. 

The company is a subsidiary of East Africa’s largest publicly listed investment company and the region’s biggest developer of housing and commercial projects.

Phase 1 of Pearl Marina was completed this year (2023), bringing 400 housing units and vital infrastructure components onstream on an investment of $50 million.

Centum is making plans for everything Pearl Marina residents need for contemporary living without leaving the shorefront community. 

The vision will be continued in Phase 2, for which it is seeking strategic investment in services. It emphasises Uganda’s steady economic growth and opportunity for investors wanting to benefit from government investment in the oil and gas industry. 

“We welcome investors captivated by residential properties, ranging from cosy one-bedroom units to spacious villas,” says Nyamai. “Additionally, we invite investments for office spaces, shopping centres, hotels, resorts, and logistics and warehousing zones. For those keen on crafting their dream homes, we offer residential plots within the master plan’s guidelines.”

Centum reserved more than 100 acres for an investment park to include light industry, dry warehousing, cold storage, a logistics hub as well as a business park. 

Between 3-5 acres are set aside for a phased shopping centre for essential services and to provide employment. 

In the longer term, Centum also has space for a 250-bed hospital and is in discussion with an international hospital operator which may want to build services to accommodate medical tourism such as neurology, renal and cardiovascular sciences. 

Meanwhile, a further 3-5 acres are reserved for a five-star hotel and school. The nearest comparable private teaching institution is some 20km away. 

Nyamai states, “The Pearl Marina Project signifies a monumental leap forward for Uganda’s real estate sector. It embraces a comprehensive approach to urban development, harmoniously blending residential and commercial zones within the masterplan.”

The impact of this project on the surrounding community has already been profound. Since its inception, the Pearl Marina Project has propelled a surge in property values, transforming the Garuga area into one of the most coveted residential suburbs in the bustling Kampala Metropolitan region.

“Pearl Marina has also emerged as a major employment hub, drawing over 90% of construction workers from the local neighbourhood,” Nyamai says. “At the peak of Phase One construction, more than 1,200 workers were directly or indirectly involved, engaged through contractors and subcontractors.”

Phase Two will have an even greater impact on local employment opportunities, the developer says.

In summary, according to Nyamai, Pearl Marina Estates attempts to transcend the conventional realm of real estate projects. 

“Pearl Marina is not just a real estate project; it’s a visionary lifestyle concept, a unique development in Uganda, promising to redefine urban living, foster sustainable growth, and enrich the lives of both residents and the wider community.”

Can you provide an overview of Tirupati Development Uganda?

Tirupati Development is a family-owned company that was established in Uganda in 2006, and chaired by Harshad Barot. The company operates primarily in the real estate development sector, specialising in the construction of shopping malls, housing estates, industrial parks and apartments. In addition to private development, Tirupati also operates as an official contractor, undertaking construction projects for the government of Uganda.

What projects are currently being undertaken by Tirupati, and how is the company’s approach to commercial condominium ownership different than its competitors?

We are currently in the final stages of constructing a 400-bed maternity and child complex at Masaka Regional Referral Hospital, on behalf of the government. The four-storeyed hospital will have an intensive care unit, two state-of-the-art theatres, gynaecology unit, labour and post-natal wards, and an antenatal and neonatal centre.

Our company has been at the forefront of introducing the concept of commercial condominium ownership in Uganda. Notable projects like Tirupati Ovino Market and Tirupati Mazima Mall exemplify this approach, enabling individuals to own units within shopping malls and industrial facilities. This innovative ownership model cultivates a shared sense of responsibility among stakeholders, fostering a distinct sense of community among property owners. We have ambitious plans to expand our portfolio with similar ventures tailored to a variety of industries, including an agricultural park in the future, thus making significant contributions to Uganda’s evolving business landscape.

Additionally, we have established the Tirupati Business Park, a sprawling 60,700-sq metre industrial park. This park has been designed to provide small and medium-sized enterprises (SMEs) with turnkey solutions for their operations. Currently, the park accommodates 150 warehouses, each dedicated to a unique industry. What sets our concept apart is our provision of all essential amenities required for businesses to flourish seamlessly, including reliable power connections, water supply and other vital infrastructure elements. As of today, our business park is home to a workforce of 2,000 individuals.

How is your organisation addressing the shortage of affordable real estate options in Uganda?

We have launched various initiatives within our business park. This includes the construction of budget-friendly apartments, the expansion of our business park with 253 new warehouses, and the creation of small-scale corporate offices tailored for mid-sized companies. This holistic ecosystem is designed to support SMEs by providing essential infrastructure and rental income opportunities, positively impacting Uganda’s housing and business landscapes. We anticipate completing the expansion within the next five years.

How does your company prioritise community development within its projects?

Community development is fundamental in each of the projects that we undertake. We closely engage with local leaders by respecting cultural values and fostering active communication with the community to highlight the benefits our projects. A significant part of our strategy revolves around ensuring the community understands the positive impact that our projects will have on future generations, including improvements in transportation and increases in property values. Additionally, through our NGO, Leela Foundation, we actively provide food resources to support the well-being of the elderly. We approach our projects with humility, viewing ourselves as partners working collaboratively with the community.

How do you assess the investment climate in Uganda, taking into account security, stability, governmental initiatives and overall business potential?

The investment prospects in Uganda are exceptionally promising. Uganda presents a diverse range of opportunities, catering to small-scale ventures, like manufacturing and larger endeavours. What makes Uganda particularly appealing is that significant returns can be achieved without requiring multimillion-dollar investments. Africa, as a whole, offers a unique landscape where minimal investment can yield substantial gains, with opportunities across various sectors.

Nevertheless, the perception remains that investing in Africa, including Uganda, involves a certain degree of risk or uncertainty. Some may not fully grasp the potential and success stories of ventures in East Africa. To change this perception, it is crucial to share the experiences of those similar to my father, who came from humble beginnings and achieved success through unwavering determination. Stories such as these are not fiction, but genuine accounts that underscore the untapped potential and opportunities that Uganda has to offer. In essence, Uganda’s investment landscape is a concealed treasure, awaiting both exploring and harnessing.

Amafh Farms: Pioneering Sustainable Macadamia Growth

World Business Journal talks to Morvi Asim, Founder of Amafh Farms about the success of his macadamia-growing initiatives, the surprising benefits of the crop for climate mitigation and his plans for rapid, sustainable expansion. 

How has Amafh Farms evolved over the years?

Celebrating our 20th anniversary this year, Amafh Farms has planted approximately 700 acres of macadamia trees over the past two decades. This achievement has solidified Amafh Farms as a symbol of sustainable agriculture and economic empowerment, where the well-being of our farmers and the prosperity of our crops are nurtured in unison.

Can you elaborate on the progress of the project?

Central to our initiative is the Macadamia Outgrower Extension Project (MOGEP), aligning with NDP 3 and the United Nations Sustainable Development Group (UNSDG) goals. The initial investment phase, spanning five years with an investment exceeding $30 million, should benefit 25-30,000 farmers and create 1.5 million jobs across Uganda. Our collaboration with the Ministry of Agriculture, Animal Industry and Fisheries (MAAF) allowed us to plant an additional 10 million trees with a 70% subsidy to growers. Moreover, we have plans to secure 100% subsidy support through engagement with NGOs and government bodies.

How does your business model combat climate change, especially in terms of carbon sequestration?

Macadamia cultivation is a powerful tool in mitigating climate change. Our research indicates that each hectare of macadamia trees absorbs over 17 tons of carbon from the atmosphere annually. Additionally, the trees’ 70 to 90 lifespan ensures sustained carbon absorption over multiple decades. This aligns with our commitment to environmentally friendly agricultural practices.

Could you shed light on your macadamia processing factory and value-added offerings?

As the sole macadamia processing facility in Uganda, our factory, which initially processed 300 kg of macadamias per hour, is evolving to meet heightened market demands. By the end of 2023, we are set to unveil a new facility with a significantly enhanced capacity of 6 tons per hour. This expansion includes an automated nursery generating 2-3 million seedlings annually. Moreover, we’re establishing a comprehensive training center in Mityana, offering our farmers an extensive seven-day program, covering pre-planting techniques, harvesting methods, and more.

In terms of value addition, we presently offer five distinct macadamia flavours. Looking ahead, we plan to introduce an extensive range of 40 to 50 new value-added flavours and products under the Macarica brand next year. This product line will encompass bars, macadamia-flavored honey, cold-pressed oil, and more, showcasing the exceptional versatility of this remarkable crop.