Namayingo District’s hopes for economic transformation have been dashed as the development of the CN Sugar factory, a multi-billion shilling project, has been suspended following a directive from the Ministry of Trade, Industry, and Cooperatives.

The decision, spearheaded by Trade Minister Francis Mwebesa, has put the factory’s future in jeopardy and left over 700 workers without jobs.

In November 2022, the CN Sugar factory was greenlit by the ministry with a certificate of no objection, allowing it to commence operations. However, in a surprising reversal on June 17, 2023, Minister Mwebesa halted the project, citing the factory’s failure to establish a required nucleus estate of at least 500 hectares and a network of sugarcane out-growers.

The abrupt change in stance has drawn the ire of the local community and stakeholders. Many believe that the minister’s decision was influenced by a petition from established sugar industry players who viewed the new factory as a threat to their operations. The petition highlighted that CN Sugar Limited had only planted about 300 acres (121 hectares) of sugarcane, significantly short of the required 500 hectares.

In his directive, Mwebesa advised CN Sugar to seek an alternative site outside the Busoga region for their operations. However, CN Sugar factory manager, Rashid Kakungulu, has challenged the minister’s decision, accusing him of acting on misinformation.

Kakungulu insists that the company has already secured an additional 500 acres of sugarcane outside Namayingo district and acquired 1,300 acres for plantations in Busia and Tororo districts.

Furthermore, CN Sugar has established partnerships with two associations, Chia Farmer’s Cooperative and Nabongo Agricultural Enterprise, providing a combined 1,365 acres for sugarcane cultivation. According to Kakungulu, the company has agreements with 1,000 out-growers who are preparing or have already planted sugarcane.

CN Sugar also holds a certificate of approval from the National Environment Authority (NEMA) and has fulfilled other regulatory requirements, including a district trading license and a memorandum of understanding (MoU) with the district leadership. The MoU includes commitments to improve infrastructure, pay taxes, and contribute to community welfare.

The suspension has sparked outrage among Namayingo residents and local leaders. District Vice Chairperson, Abdullah Latif Kawuta, expressed his disappointment, highlighting the project’s positive impact on local development, such as increased rental income and reduced crime due to employment opportunities.

Residents like Winnie Nabirye have suggested that corruption might be behind the decision to halt the factory’s construction. Local supplier Ibrahim Mukisa lamented the loss of his investment in supplying construction materials to the factory.

The unrest culminated in a protest on Tuesday, where police used live bullets and teargas to disperse angry workers and Indian investors at the CN Sugar factory site.

The suspension of the CN Sugar factory underscores the delicate balance between regulatory compliance and local economic development. As the situation unfolds, the future of Namayingo’s first major industrial project remains uncertain, with the community left grappling with the fallout.