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Last Updated: Friday, 12 March, 2004, 16:35 GMT
SA retailer buys Uganda coffee
By Martin Plaut
BBC regional analyst

Coffee beans
Coffee is one of Uganda's main cash crops
During apartheid, South African businessmen had the greatest difficulty working in Africa.

But since the apartheid regime came to an end 10 years ago, South Africa has grown into the continent's economic giant.

It now has investments worth $500m (400m euros; 275m) across Africa, dominating its mobile phone industry and controlling many formerly state-owned assets in Tanzania.

But now, in a small step to reverse this trend, South Africa's largest supermarket chain has decided to source its ground coffee from Uganda.

Shoprite Checkers has begun to import the coffee in small quantities.

But since the firm runs 700 stores in 15 African countries, and has a turnover of $4bn, this modest step could lead on to larger things.

More trade

South Africa's trade minister, Alec Erwin, underlined the significance of the deal by calling on African nations to trade more with each other.

"We have to open our economies to each other, we only need to look at Europe to see how they have benefited," he said.

Mr Erwin also pointed out that South African exports to Uganda were currently worth 20 times the flow of goods in the other direction.

The Ugandan company that has struck this deal is the Rwenzori Coffee Company.

Its chairman, Andrew Rugasira, pointed out that although Uganda exports 13% of the world's coffee, it gets just 1% of total retail earnings.

At present the South Africans will import only ground Arabica coffee.

But there are plans to extend the range to espresso coffee and possibly to instant coffee - and to distribute this to its stores in 15 countries.

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