Government Moves In To Support COVIDEX Manufacturer. Gives Him Land and Tax Holiday

The Uganda Investments Authority, UIA, has intervened to promote the herbal treatment solution Covidex, an innovation by Mbarara University of Science and Technology Professor, Patrick Engeu Ogwang.

As these differences continue, UIA is to facilitate the development of herbal medicine and Prof Ogwang’s company, Jena Herbals Ltd.

UIA and Ogwang “will explore a range of issues including the issuance of an Investment License, investment incentives, formalization of Covidex and other medicinal products, investment and business support, amongst others,” says a statement from the UIA.

Last week, ahead of the planned meeting with President Yoweri Museveni, Vice President Jessica Alupo a meeting with Prof Ogwang and members of the Aga Khan Foundation, they “discussed ways of supporting COVIDEX production on a large scale,” according to Alupo.

Robert Mukuza, the new Director-General of UIA vowed the put domestic entrepreneurs on top of the development agenda.

“Under my leadership, the UIA will play a critical role in awakening Ugandans into the modern money economy,  to “secure their future” through, pursuing several priorities which are in line with the National Development Plan III and the current UIA strategic plan. We will also prioritize the needs of our domestic investors and Micro, Small and Medium-Sized Enterprises, focus on creating jobs and wealth for our youth and improve the agility and customer responsiveness of the UIA- to the needs of investors,” said Mukiza, on his plans for Ugandan investors.

“We congratulate you for listening to the call of the president. You have registered your company and that you have expressed desire to put up a factory, we had to assist you.” the State Minister in charge of Investment and Privatization said.

Minister Anite said government had chosen Soroti Industrial Park for Prof.Ogwang’s factory since the area is near some of the raw materials for the Covidex drug

“We are happy you are close to natural resources. Ugandans are testifying for Covidex to have helped them get relief from Covid. We will give you support since our job by law is to facilitate investment. We will always be available in case of any challenges.”

The Investment minister also announced a ten-year tax holiday Prof. Ogwang’s plant and machinery as part of incentives for his factory.

Speaking at the function, Prof. Ogwang said he was ready to hit the ground running with the new factory for his Covidex drug.

“We have already mobilized resources. We are ready to start construction as soon as the environment assessment report is out. I want to thank government for putting more emphasis in local investment,”Ogwang said.

“This(factory) is not for Ogwang or Teso region but Uganda and Africa at large.”

The Uganda Investments Authority is an agency charged with attracting, facilitating and promoting investments, both local and foreign.

There have been persistent claims that the UIA focuses on foreign investors and does little or nothing for the local investors, especially the Micro, Small and Medium Enterprises, MSMEs.

The UIA refutes this and says it has even established an SME Division, which is especially aimed at handling this category of investors, most of whom are domestic enterprises.

“The SME Division (SMED) of UIA supports and facilitates the development of MSMEs who are majorly domestic entrepreneurs. The overall goal of the SME division is: Developing Sustainable Domestic Investments & SME’s,” says UIA in a statement.

These include an Entrepreneurship Training Program, to enable entrepreneurs to access and utilize appropriate business skills, information and services aimed at achieving a sustainable and competitive private sector in the long run.

This mainly targets those intending to start a business, businesses in the early stages, businesses interested in expanding and, Small and Medium Enterprises (SMEs).

UIA’s other role is to provide hands-on Technical Skill Training for value addition aimed at building capacities of MSMEs.

Under the Cluster Development and Business Linkages program UIA helps domestic entrepreneurs to integrate their business systems into global value chains by providing economies of scale.

“Cluster development helps to address the challenges of isolation in small firms by creating a critical mass of mutually beneficial business relations, linking an SME to a bigger company (including Trans-National Companies).

The programme nurtures SMEs to meet regional and international business standards and encourage TNCs to source locally from the SME clusters instead of sourcing from foreign firms,” the statement says.

The UIA also has business incubators that help both start-ups and existing small businesses to grow sustainably, hence lowering the mortality rate through good businesses practices and appropriate technology.

UIA is currently establishing a mixed-use business incubation centre at Kampala Industrial Business Park in Namanve to facilitate, support and nurture MSMEs.

This will assist emerging companies to gain access to mentors, training, shared space, professional assistance and capital among other services that will move them onto the fast- track to success.

In addition, SME Division is planning to establish at least 500 workspaces and common facility centres for the small scale industrialists in each of the UIA Industrial and Business Parks.

If Prof Ogwang is to get an investment license for his Jena Herbals Ltd from the UIA, he will have to ensure its capital is at least 50,000 US Dollars or 178 million shillings, the requirement for domestic companies, while foreign firms must have a capital investment that exceeds 250,000 dollars (445 million shillings.

Ogwang caught the eye of the public, the government and the international community last month following testimonies and a rush for covidex as vital in the treatment of covid 19.

The popularity of Covidex was reflected in the skyrocketing price of the 20 millilitre bottle of the solution from 3,000 to up to 80,000 shillings after it had been approved by the National Drug Authority-NDA.

While many saw Ogwang and his innovation as a blessing, his employer and some lawyers came out to challenge his claim of ownership of Covidex, on grounds that it was developed under a university program and that he used government resources to develop it.