Like many districts across the country, Mayuge District, located in the eastern part of Uganda, suffers from poverty on top of its many outcries to the government.
As a way of combating this situation, the government, through the Ministry of Agriculture, Animal Industry and Fisheries, zeroed in on Mayuge as the area where it should focus its next oil palm project. This was based on the benchmark of the transformation of livelihoods in Kalangala District, where Oil Palm production is flourishing.
With a loan of $261m from the International Fund for Agricultural Development (IFAD) to the Government of Uganda, meant to finance the 10-year National Oil Palm Project, the wait was no more. Last week, at Mayuge District headquarters, Mr Fred Bwino Kyakulaga, the State minister of Agriculture, Animal Industry and Fisheries, presided over the official launch of the National Oil Palm Project.
The ceremony was attended by district council members and various farmers who testified to their delight about the current progress and also expressed their gratitude to the government for this life-changing derivative.
However, often, government projects such as these habitually suffer from a lack of integrity, efficiency, proper management, transparency and accountability.
As such, to properly manage the funds and achieve the utmost positive results and outcomes, the government selected Equity Bank to manage the loan.
Through this, the bank is not only holding and dispensing the funds, but also providing capacity-building to the smallholder farmers. The bank has schooled farmers in developing various financial and investment solutions, incorporating enablers to reduce risk and maximise success.
The process
Oil palm seedlings take 18 months before they can be ready to plant, and the bank says that within two years, 896 farmers have been able to benefit from these funds. The farmers have been taught how to dig proper holes supported with pesticides and fertilisers, and have been given seedlings which are ready to plant.
And that is not all. ‘Equity is also employing modern banking systems to track every transaction, verify beneficiaries and ensure funds reach the genuine oil palm farmers in record time,’ says Catherine Psomgen, Equity Bank’s director of public sector and social investment.
Mr Kyakulaga said, ‘This move is going to go a long way in transforming the people of Busoga from the chronic poverty which has affected them for so long.’
So far, the project is at phase one with Mayuge, Bugiri and Namayimba as the first beneficiaries, with the other parts of Kamuli, Iganga, Jinja City, Bugweri, Namatumba, Luuka and Kaliro set for the next year. To benefit from this, each farmer or a group of farmers must possess five hectares of land for which each will receive $6,500 (Shs23 million). Farmers with half of the required land will also get half of that money.
However, for appropriate use, not all the money is transferred directly to the farmer’s account. The largest chunk will be managed through the bank and the Ministry of Agriculture. Here, the ministry’s suppliers deliver pesticides, fertilisers, trim the trees and also educate the farmers on maintenance.
The rest is then remitted to the farmer’s account and followed up for accountability. ‘Without exporting, Uganda has a ready market for palm oil, soap, cosmetic products and various items which require palm oil as a raw material. At harvest each farmer will be directly earning Shs2.5m monthly, and that runs for about 25-30 years. So, the Government of Uganda has answered the Busoga poverty and job crisis issue with this oil palm project,’ Mr Kyakulaga said.
Deal
To benefit from this, each farmer or a group of farmers must possess five hectares of land to which each will receive $6,500 or Shs23 million. Farmers with half of the required land will also get half of that money.