I can see that the sad story of privatization hasn't changed one bit.
Ssebagabe Museveni is still busy issuing chits to give away the family
silverware for a song.
[EMAIL PROTECTED] wrote:
*President âdonatesâ Dairy Corp to Thai *
/ By Andrew M. Mwenda /
/// Jan 30, 2005 /
*KAMPALA â* President Museveni has directed that the Dairy Corporation
Limited be given to a Thai businessman at a fee of only one dollar.
Highly placed sources at State House said that the President's
directive was issued on Thursday last week.
Our investigations show that the Privatisation Unit (PU), under the
ministry of Finance, Planning and Economic Development, scheduled the
Dairy Corporation for privatisation early last year.
Sources said the exercise had reached the state of pre-qualifying
bidders through competitive bidding.
However, on October 25, 2004, Vice President Gilbert Bukenya wrote the
minister responsible for privatisation, Prof. Peter Kasenene, saying:
"His Excellency the President has directed that Dairy Corporation
should be given to Malee Sampran Sampran Public Company Limited whose
chairman is Mr. Chatchai Boonyarat for a period of three years."
The letter further says, "This is therefore to direct you to initiate
the process of drawing up the terms of the lease so as to finalise the
lease agreement in order to enable the Malee Company to commence
operation by January 2005."
The PU complied with the President's directive and drew up a draft
agreement for the lease to the Thai company.
However, sources say, the PU drew up an agreement in which it required
Malee to pay a $1 million as lump some payment for the lease, then
oblige the company to pay a percentage of the profits from Dairy
Corporation to the government, and also to pay a yearly rental fee to
the government.
A highly placed source at State House said that when the President
learnt of the requirements under the draft lease agreement, State
House issued yet another directive to the PU to remove all the payment
provisions of the draft.
Instead, the source said, State House directed that Malee should only
pay $1 (one dollar) - a nominal fee - for Dairy Corporation, virtually
handing the corporation to the Thai businessman on a silver platter.
People familiar with the transaction said that because of the State
House directive, Malee will take Dairy Corporation from the PU even
without presenting a business plan on what it intends to do with the
corporation.
The only promise the Malee chairman has made is that he will, within
one year of taking over the corporation, build a dairy plant in
Mbarara from the profits he makes.
The Sunday Monitor has learnt that Malee chairman Boonyarat is not
going to invest here as Malee but will float a company locally to take
over Dairy Corporation.
"Yes, there was a government directive to offer Dairy Corporation to
Malee and the [privatisation] minister can answer all the other
details," said PU Executive Director Michael Opagi.
Minister Kasenene confirmed on Friday the details outlined here save
for the nominal fee. "We have not yet agreed on the figure, so the one
dollar price of Dairy Corporation is false. We shall negotiate with
them on the figure."
However, sources close to State House maintained that the President's
directive was clear: Malee should only be charged a nominal fee, which
is usually one dollar.
Kasenene then amended his statement and instead said the President
directed that PU "should not ask for a prohibitive figure that will
frustrate the investor".
However, when asked why the President not only disregarded the
competitive bidding process but also issued a directive to PU that
virtually arm-twists the unit to offer a state owned enterprise to a
private foreign investor at a low price, Kasenene said: "That is his
prerogative and I cannot comment on it."
The PU recapitalised the Dairy Corporation at Shs2 billion toward the
end of 2003 to improve its performance, but Kasenene said: "In spite
of recapitisation, the Dairy Corporation was still struggling and it
needs more capital injection because the machines are old. We did not
want to put more money into it, but instead sell it off. It is a
strategic enterprise which if it collapsed, the farmers would suffer."
The Dairy Corporation was established in 1967 as a parastatal in the
ministry of agriculture, animal industry and fisheries. In 1998, a new
law was passed separating the commercial from the regulatory and
development functions of the corporation.
The number of farmers selling milk to the corporation rose from 3,280
in 1988 to more than 13,000 in 2002. In return the corporation paid
farmers Shs3 billion in 2002 up from Shs105 million in 1988.
* Â 2005 The Monitor Publications. *
------------------------------------------------------------------------
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