Uganda: Growing Trees for Cash; a Long Term Lucrative Venture
When Mr Ponsiano Besesa sold his four-storey-hotel in Kampala to invest in forestry in February last year, people thought he was going mad. But the old man had calculated and knew very well that trees would reap him more than what a hotel would.
Mr Besesa, the managing director of Besepo (U) Ltd, a company that plants trees and sells timber in Nbeeba-a Kampala suburb, owns several hectares of artificial trees in various parts of the country which he says are the source of his peace and joy.
While some people in government made 'big names' when they attempted to give away Uganda's biggest forest-Mabira to investors to grow sugarcane, Mr Besesa had different thoughts. He wants to use his passion for tree growing and protecting the environment as a stepping stone to build him a legacy that will live on beyond him.
Mr Besesa, who has spent 32 years in the timber business, traces his roots to his father who was the first Ugandan registered sawyer in the early 1940s, in the greater Kigezi region which was subdivided into Kabale, Kigezi, Rukungiri, Kisoro and Kanungu districts.
Having started by lumbering stolen trees from Bwindi National Forest, Mr Besesa says he graduated from using a borrowed sawmill in 1995, when he got a loan worth Shs120million from Uganda Development Bank and bought his own, 16 years after officially registering as a sawyer.
Mr Besesa attributes all his success to his timber business.
"I married, educated all my children up to University level, built a hotel which I later sold, built a house; all with income from the timber business," he says.
Driven by the need to please his father who was always against his ways of cutting trees without replacing, Mr Besesa started tree planting in 1996 to please his father not knowing that in future, it was to become a hobby to an extent of selling a Kampala based hotel (Mwana Highway Hotel- Ndeeba) to go and grow trees in the village.
Mr Besesa has planted a total of 915 hectares of Pine and Eucalyptus trees in western Uganda with 100 acres planted in 1996 in Kabale, 142 planted in Mbarara in 1998, 250 acres planted in Kibaale from 1999 to 2001 and 423 acres in Kasana-Kasambya forest reserve in Mubende district.
Taking between 7 to 10 years to mature for electricity connection poles, a 10 metre unprocessed Eucalyptus tree costs Shs100, 000 yet a 14 metre one costs Shs176, 000.
For strong timber, eucalyptus and pine trees take up to 20 years before getting ready for timber processing. Mr Besesa says he bought all the pieces of land using income from the sell of timber with exception of the land in Mubende which was given to him by the then forest department which is now National Forest Authority in 2003 for the same puporse. Depending on size and specie, timber ranges between Shs6,500 and Shs500,000.
"When I sold the hotel for this hidden business, people thought the bank had confiscated it," says Mr Besesa adding that "the hotel business couldn't fetch me the money I want due to stiff competition in the business these days.
Though his first investments in Kabale are ready to hit the market, Mr Besesa seems not to be in hurry. He says he is still waiting for a total scarcity so as to reap big from his sweat. Fully grown, a hectare of unprocessed eucalyptus or pine trees cost Shs80million.
The winner of the SPGS 2008 Award for the Best Small and Medium Scale Planter says tree planting calls for determination and patience since it's a long term investment.
To plant and maintain a hectare of tees costs not less than a Shs5million including bush clearing, lining, pitting, planting and weeding. A tree seedling costs Shs300 and a standard hectare consumes 1111 tree seedlings.
"Nurturing trees for the first three years is the most expensive and hectic stage in tree growing," says Mr Besesa.
Through the forest business, Mr Besesa has traveled to different parts of the world including South Africa, Australia and Brazil.
Though there have been numerous warnings that the desert was moving from North to south of the continent, Mr Besesa says that the forestry business in the country was still unrecognised by both the government and the banks.
"Banks in Uganda don't give loans for the forestry business because of the long maturity of the investment," he says.
He, however, says that the European Union through its Sawlog Production Grant Scheme in conjunction with the government of Uganda has supported them education-wise and financially.
For the first time in history, NFA got a budget allocation of Shs1billion in the June read 2009/10 financial budget for the Active Tree Fund that has been unfunded since 2003 when it was established.
Having an industry producing tree-related products would be Mr Besesa's biggest achievement.
National Forest Authority Public Relations Manager Moses Watasa, says though tree planting had been ignored for years, many people are waking up to the fact that it is a lucrative business.
Mr Watasa says that there is a 30 per cent deficit between demand for tree products like timber, electricity transmission poles, plywood, firewood and charcoal in the country and that in the next one year, the situation could get even worse.