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Gov't Yet to Bail Out Major Tea Factories in Tooro

Mpanga Growers Tea Factory Limited in Kabarole district and Mabale Growers Tea Factory in Kyejonjo that are the largest in the region and owned by small holder farmers are indebted to a tune of 17.5 billion Shillings.

Audio 4

The government is yet to bail out two major tea factories in the Tooro region that are sinking in debts.

Mpanga Growers Tea Factory Limited in Kabarole district and Mabale Growers Tea Factory in Kyejonjo are indebted to a tune of 17.5 billion Shillings.

In February, while meeting the members of the Tooro Elders Forum in Fort Portal President Museveni promised to direct the Minister of Finance to bail out the two factories.

However, the president's pledge is yet to be fulfilled. 

Rogers Siima, the General Manager of Mabale tea factory says that in 2008, the President made a similar pledge that landed the company in the current debt of 10 billion shillings that was borrowed from Kenyan Commercial Bank.

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Siima adds that the current situation is aggravated by a fall in prices of green tea.

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According to Siima, due to the delayed fulfilment of the presidential pledge, the company no longer has the capacity to pay the 600 workers on time. 

Saul Kusemererwa, the General Manager Mpanga Growers Tea Factory Limited, says that the factory has failed to pay a loan of 7.5 billion shillings it borrowed from Centenary bank and other financial institutions.

He also says that there are fears that the factory will be auctioned.

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Richard Rwabuhinga, the Kabarole District LC V Chairperson says that he plans to remind the president about the pledge. 

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Mabale is owned by 3,000 shareholders. Mpanga, on the other hand, is owned by 1,700 shareholders.