Justification for a coffee processing plant in Bugisu

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OPINION

By Mike Mukula

Uganda stands at historic crossroads. The National Resistance Movement (NRM), under the visionary leadership of His Excellency President Yoweri Kaguta Museveni, has long championed value addition as a pathway to structural economic transformation.

The Government’s policy emphasis on agro-industrialisation, commercial agriculture and job creation reflects a firm understanding of the political economy of development, where state-led initiatives in key productive sectors can lift millions out of poverty. One such opportunity, long overdue for strategic intervention, lies in Bugisu’s Arabica coffee sector.

This article presents a robust political economy case for granting the Bugisu Co-operative Union (BCU) a fully-fledged coffee processing plant — a catalytic intervention that promises to unlock the latent economic potential of eastern Uganda, generate employment and secure Uganda’s competitive positioning in the global specialty coffee market.

The political economy of coffee and regional inequality

Coffee is not merely a commodity in Uganda; it is a cornerstone of rural livelihoods, a generator of foreign exchange and a tool of economic diplomacy. Yet, the benefits of the global coffee value chain have consistently eluded smallholder farmers.

Uganda exports over six million 60kg bags of coffee annually, yet most of this coffee is exported as raw, unprocessed beans.

The value addition — roasting, branding, packaging and marketing — occurs elsewhere, particularly in Europe and Asia, where consumers pay a premium while producers receive a fraction. Nowhere is this marginalisation more visible than in Bugisu sub-region, the cradle of Uganda’s finest high-altitude Arabica coffee.

Bugisu farmers grow some of the world’s best Arabica under organic and traditional conditions, but they remain trapped in a colonial-era production-export model. Their coffee is sold as green beans, denying the region opportunities for value retention, employment and industrial learning.

Investing in a large-scale coffee processing plant under the stewardship of BCU is, therefore, not only an economic imperative — it is a justice issue. It is about correcting historical imbalances in resource allocation, empowering a productive region and fulfilling the NRM’s promise of shared prosperity.

Bugisu co-operative union: an institutional anchor for inclusive development

Established in 1954, BCU is one of Uganda’s most enduring farmer-based institutions.

Despite years of political interference, liberalisation setbacks and undercapitalisation, BCU has remained a resilient emblem of community self-help and local ownership. It aggregates coffee from over 250 primary societies, representing thousands of smallholder farmers in Mbale, Manafwa, Sironko and Bududa.

BCU’s institutional legitimacy, grassroots network and historical credibility make it the ideal vehicle for managing a regionally anchored coffee processing plant.

It embodies the NRM principle of building from the bottom-up and supporting indigenous institutions to lead local development.

Rather than create new bureaucracies or import foreign solutions, the Government should empower BCU to become a flagship agro-industrial co-operative, a model that can be replicated across the country.

Moreover, BCU’s focus on Arabica — one of the most prized and highest-earning coffee varieties globally — aligns with Uganda’s ambition to move up the value chain. The specialty coffee market is growing rapidly, especially among ethical consumers in Europe, North America and Asia.

A BCU-led processing plant would allow Uganda to sell roasted and branded Bugisu coffee directly to these markets, capturing value that currently accrues to middlemen and foreign processors.

Youth employment and empowerment

The demographic dividend is both an opportunity and a risk for Uganda. With over 70% of the population under the age of 30, job creation is a matter of national security.

The coffee processing plant in Bugisu would absorb youth at multiple stages of the value chain — from sorting, roasting, quality control, packaging, logistics, marketing, to export co-ordination. These are not just jobs — they are skills, careers and pathways to entrepreneurship.

Furthermore, the industrial ecosystem around the plant will attract complementary investments in warehousing, transport, finance and ICT.

Vocational institutions can align their curricula to produce industry-ready technicians and quality analysts. With the right public-private-academic partnerships, Bugisu can become a hub for agroindustrial innovation — anchored on coffee, but radiating broader impacts.

Women, who make up a significant portion of the coffee workforce, will benefit from the formalisation of employment and enterprise opportunities.

Co-operatives are inherently inclusive, and BCU has a track record of involving women and youth in its operations. The coffee plant would formalise and multiply these gains.

Regional stability and political cohesion

The allocation of strategic investments, such as a coffee processing plant, is not merely an economic decision — it is a signal of national inclusion.

Regions that perceive themselves as excluded from the developmental state often nurture grievances that undermine political cohesion.

Investing in Bugisu is, therefore, a strategic move to entrench the NRM’s presence, especially in a region with historical tensions and recent electoral volatility. A fully operational coffee plant under BCU would affirm the state’s commitment to the development of eastern Uganda. It would anchor the region into the national industrialisation agenda and demonstrate that the Government listens to grassroots voices, especially when presented through coherent institutional structures like BCU.

Moreover, it would operationalise the Parish Development Model (PDM) and other government programmes, ensuring they have a market pull for productivity. Without value addition infrastructure, farmers remain exposed to price shocks, middlemen exploitation and post-harvest losses.

Fiscal and foreign exchange gains

From a macroeconomic perspective, coffee value addition would increase Uganda’s export revenues, diversify its trade portfolio and reduce dependency on raw commodity exports. Processed coffee commands up to three times the price of green beans. Even if only a fraction of Uganda’s coffee is processed domestically, the foreign exchange gains would be substantial.

Furthermore, processed coffee exports are less vulnerable to global commodity fluctuations because they enter premium niche markets. This means more stable revenue for the state and for co-operative farmers. It also increases the tax base, as formal enterprises like BCU can remit taxes on value-added products, rather than rely on informal, untraceable export arrangements.

The BCU plant would also attract diaspora investment and branding partnerships, as there is growing global interest in origin-certified and farmer-branded coffee.

Uganda can emulate successful models from Ethiopia, Colombia and Rwanda, which have leveraged their unique coffee identities to increase national revenue and prestige.

Strategic partnerships

While the case for the plant is overwhelming, implementation must be meticulous.

The Government can channel the required support through the Uganda Development Corporation, the Agricultural Credit Facility at the Bank of Uganda and strategic partnerships with the agriculture ministry, Uganda Coffee Development Authority and Operation Wealth Creation. A public-private-co-operative partnership model is ideal, where the Government provides the infrastructure, BCU offers the institutional framework and private sector players bring market access and technical expertise. This shared-risk model ensures sustainability and accountability.

Moreover, the plant should be environmentally sustainable, incorporating renewable energy and waste recycling to align with Uganda’s commitments under the Sustainable Development Goals and the Green Growth Strategy.

A call to action

Your Excellency, the time to act is now. A coffee processing plant under Bugisu Co-operative Union is more than a development project — it is a legacy investment that aligns with Uganda’s Vision 2040, the NDP III and the NRM’s historical mission.

It is a beacon of hope for thousands of smallholder farmers, unemployed youth and regional entrepreneurs. It is a practical expression of economic patriotism, agricultural transformation and industrial modernisation.

In approving this investment, you will be igniting a chain reaction of prosperity that reverberates beyond Bugisu to the entire nation. Uganda’s coffee story must not end at the farmgate. It must extend to global shelves with the proud label: Roasted in Uganda. Packaged by Ugandans. Powered by Bugisu.

The writer is the NRM National vice-chairman for Eastern Region