Uganda government has written to its Kenyan counterparts regarding the confiscated 23 tonnes of Lato Milk products produced by Pearl Dairies Ltd.
Africa Agribusiness EAC Industry

Uganda gives Kenya 14-Days Ultimatum to release confiscated Lato Milk

Uganda government has written to its Kenyan counterparts regarding the confiscated 23 tonnes of Lato Milk products produced by Pearl Dairies Ltd.

According to Uganda’s Trade Minister Amelia Kyambadde, through the Foreign Affairs Ministry, they have written to the Kenyan government to give an update and response within 14 days.

“Kenya exports more goods to Uganda than we export to Kenya. The trade balance is still in favour of Kenya. We don’t want to retaliate by banning Kenyan products on to the Ugandan market because of the East African Community spirit but we have written to them through the ministry of Foreign Affairs expecting a response/explanation within 14 days,” said Kyambadde in Kampala.

Kyambadde said as the Minister of Trade, she tried to contact her counterpart in Kenya, but because of the reshuffles that went on in Kenya recently, she couldn’t get in touch with the new Kenya Cabinet Minister for Trade.

Uganda demanded that Kenya immediately release the seized consignment of {Lato} branded milk as they were duly cleared by the relevant Kenyan government bodies for importation into Kenya and are not contraband, substandard and or counterfeit as alleged.

“Cease any operations specifically targeting Ugandan made milk exported to Kenya. Refrain from any actions against Uganda’s exports to Kenya be it milk or any other products that contravene the EAC customs union protocol and common market protocol.

“Take responsibility for any spoilage of the products that may have been suffered during the illegal detention of the products and losses suffered in accordance with the EAC NTB elimination Act 2017.

“Address any trade concerns within the existing EAC and bilateral frameworks rather than using arbitrary means that could jeopardise the otherwise blossoming trade relations between the two countries.”

Recently, several traders distributing Ugandan milk in Kenya saw their products confiscated by authorities in Kenya, even when they have evidence that they had paid duties to get the milk into the country.

Kenya Anti-counterfeit Unit early this week raided Milk distributors in Meru in eastern Kenya and confiscated up to 23 tonnes of milk.

According to Pritpal Bhamra whose depot was raided and he mainly stocks products of Pearl Dairies Ltd like Lato Milk manufactured in Mbarara Uganda, the raid was intended to block investors from doing business and called the raid “politically motivated.”

The same unit had also raided two warehouses belonging to one of the largest milk importers and distributors in Nairobi and took away tonnes of milk powder under the brand name Lato Milk.

Lato Milk is processed in Mbarara by Pearl Dairy and is one of the most popular brands in Kenya but the country has recently sought to reduce milk imports because of low prices local farmers there are facing.

Last month, Kenyan officials visited Uganda to ascertain whether indeed the milk was coming from Uganda. They concluded that Kenya would be imposing a 16 per cent Value Added Tax (VAT) on Ugandan milk.

This, Kyambadde said is illegal under the Common Market protocol and they will await Kenyan government response after the 14 days.

Uganda has seen its milk production grow tremendously with reforms in the dairy sector to 2.6 billion litres a year in 2018. At least 144 million litres are sold in Kenya every year, according to industry estimates. Kenyan companies like Fresh Dairy are big processors of milk exported there.

Good weather has also seen Kenya up its production to 5 billion litres a year. This with the milk imported from Uganda has depressed the local market, forcing Kenya to start measures to curtail Kampala milk. In 2010, Kenya blocked milk from Uganda to protect its farmers.