中文 FRANÇAIS Beijing Review
Africa
Phosphate Empowerment
Major China-Uganda phosphate deal brings benefits to local villagers and the country at large
By Godfrey Olukya | VOL. 8 JANUARY 2016

Henry Okwalanga is over the moon. The villager from an impoverished area in east Uganda has finally got a solid roof over his head. "Look at my beautiful house. Before it was constructed for me by the Chinese, I was living in a grass-thatched hut," he told ChinAfrica.

Okwalanga is one of more than 100 villagers who were relocated to new homes to facilitate construction of the Sukulu Phosphate Comprehensive Industrial Development Project in east Uganda's Tororo District. "I have benefited a lot from the project," he added.

Though the Sukulu phosphate project idea was developed six years ago, the Ugandan Government reached an agreement with Chinese company Guangzhou Dongsong Energy Group only in September 2013. Guangzhou Dongsong is engaged in mining, energy, hydropower and commercial property sectors. The group's President Lu Weidong said at the time that they were determined to see that the project benefited the residents of Sukulu, the village where the phosphate reserves are located.

However, despite the agreement, there was initial resistance when the villagers were presented with the plan to build a phosphate factory in their midst. They opposed the project outright, unwilling to leave the place of their birth, which contributed to the long delay to get things moving.

A different tune

Today they are singing a different tune, praising the factory construction, satisfied with the relocation compensation and the prospect of employment.

"Supported by local politicians, they at first threatened to kill any government official who went there; the young men organized themselves into fighting groups to protect their land," Robert Kizza, an official at the Ministry of Energy and Mineral Development, told ChinAfrica.

But the government tactfully sensitized villagers to the importance of the phosphate factory to them as farmers, and to the country as a whole, especially in regard to much-needed job opportunities for unemployed youth in the area, Kizza added.

Uganda's Minister of Energy and Mineral Development, Irene Muloni, played a big role in convincing them to accept the project. "I told them that they should not lose the opportunity because it was meant for their well-being." she told the media when President Yoweri Museveni launched the $620-million project on August 18, 2014. Muloni emphasized that people would benefit by finding employment. She said she had informed the villagers that phosphate products, like fertilizers, would be made available to them at affordable prices. Also, the export of phosphate items would bring in foreign exchange, which would be used to provide social services for Ugandans.

Finally, the promise to fairly compensate villagers for their land and build them new houses 3 km from the project site sealed their approval.

At the launch, Museveni said the project, covering 26.5 square km in Sukulu and Rubongi sub-counties, would manufacture fertilizers, steel products and sulfuric acid. It would also have a small power plant, generating 12 MW-hours of electricity. When completed, the project would employ more than 1,000 workers and earn Uganda $600 million annually. "This is a very important project... It will benefit you local people and all Ugandans at large," Museveni said.

But from the time of the launch to September 2015, the project was stalled due to numerous challenges. Besides villagers' initial disapproval, there was a lack of adequate manpower and machinery to start construction. Finally in mid-October, it kicked off with Chinese firm 23rd Metallurgical Construction building office blocks, a dining hall and accommodation for the staff.

Security assurance

The project commenced after a visit by senior officials from China Export and Credit Insurance Corp. and the Industrial and Commercial Bank of China (ICBC), the main sponsors of the project, on October 10. The team met Tororo District officials and was assured of security for the project and maximum cooperation.

According to a press release from Uganda's Ministry of Energy and Mineral Development, the project has received $240 million in funding from ICBC. The funding agreement was signed in South Africa on December 4, 2015.

The project manager, Zheng Xu, told ChinAfrica that by November 2014, a total of 124 residents had received compensation and been voluntarily relocated from the project site.

 Local village leaders confirmed that since the residents had embraced the project, the work would go ahead without hindrance.

Pan Kexi, the project's construction manager, said most of the workers are Ugandans. "Apart from the 10 Chinese employed for technical services, the rest of the workers will be recruited locally," he told ChinAfrica. Pan added that all the materials will also be purchased locally. Most of the machines to be used in the construction are already on site and work is in full swing, according to Pan. The construction manager also said the surrounding villages will benefit from the schools and hospitals to be built as part of the project's social responsibility obligations.

Guangzhou Dongsong intends to produce 300,000 tons of phosphate fertilizers and 300,000 tons of steel. Its sulfuric acid plant will have the capacity to produce 200,000 tons annually. The power plant will initially generate 5 MW-hours of electricity and later be upgraded to 12 MW-hours.

The phosphate plant is expected to start production in December 2016. The mineral deposits at the Sukulu phosphate project are expected to last for more than 100 years and generate $350 million annually, the Ugandan Government has said. According to miningreview.com, Sukulu has an estimated 230 million tons of phosphate deposits.

Phosphate is a salt of phosphoric acid. Organic phosphates are important in biochemistry and bio-geochemistry (ecology) while inorganic phosphates are mined to obtain phosphorus for use in agriculture and industry.  (Reporting from Uganda)

 
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