By Charles Etukuri
Uganda’s Lato milk was on March 28, 2023 allowed to invest in Kenya’s as a local dairy factory as the country moves to open up the sector to other players. The Monday agreement will now see Mbarara district based Lato which was established in 2012 by Pearl Dairy Farms owned by Midland Group invest in Kenyan milk factories aimed at reviving them in what will see the company emerge as a key player in the regional dairy sector.
The decision follows a meeting between Kenya’s Cabinet Secretary for Investments, Trade and Industry Moses Kuria who on Monday met with the Permanent Secretary/ Secretary to the Treasury of the Ministry of Finance, Planning and Economic Development Ramathan Ggoobi.
The meeting also agreed the facilitation of a regional co-investment initiative between the Devki Group, the Uganda Development Corporation and the Kenya Development Corporation and under a framework agreement to allow the transfer of iron ore from Uganda to DEVKI which will be finalized in Uganda by April 5, 2023.
In a communique released on Tuesday indicated that the meeting focused on mutual economic and investment objectives by the two countries as a follow up to the various bilateral meetings between the two countries to facilitate regional co-investment opportunities in strategic sectors.
“Kenya and Uganda enjoy sisterly relations and continue to strengthen bilateral relations in trade, investment and people to people relations. Uganda remains Kenya’s leading trade partner in the EAC region and second largest globally,” the statement said.
The communique noted that a number of outcomes were agreed upon during the meeting and these included;
That Lato Milk Company and the Kenya Development Corporation (KDC) to better leverage regional investment opportunities to positively impact the dairy sector and enhance efficient production of milk and its byproducts in our two sisterly countries.
They also agreed that joint planning of production and manufacturing enablers including raw materials between Kenya and Uganda to facilitate an all-round supply of raw materials for steel manufacturing between the two countries to facilitate competitive production of industries in both nations.
The meeting also agreed on the need for acceleration of the production of animal feeds to support the dairy sector as an enabler to food security taking into account the benefits thereof for farmers in both countries.
Lato Milk Company to engage relevant parties on support by way of investment in struggling milk factories to cushion them from collapse to ensure their revival and continuity.
The Kenya Dairy Board to facilitate LATO Milk to transfer powdered milk from Uganda to Kenya by removing the requirements to receive a permission for each consignment transferred to facilitate trade.
The Integration of the commodities exchange and the warehousing receipt systems of the two countries through KOMEX in Kenya and the Warehousing Receipt Agency in Uganda, through certification of warehouses in both countries to facilitate efficient trade in the two sister states
Both parties agreed to review the framework towards regional co-investment initiatives in the next one month.
Currently, Kenya’s Brookside Dairy Limited, owned by the former President Uhuru Kenyatta, is Kenya’s largest milk company and controls a market share of 40 per cent, according to the Competition Authority of Kenya (CAK).
