The Oasis Mall owner recently declared a bid to head the Uganda National Chamber of Commerce, and this has cast the spotlight into her business dealings. She is one of the business people with Non Performing Loans that led to Crane Bank’s takeover by BoU.
Somali tycoon Amina Hersi Moghe is considered one of the wealthiest women in Uganda with interests in real estate and agriculture. She is the owner of Oasis Mall that is popularly known as Nakumatt and Laburnam Courts, an upscale apartment complex in Nakasero.
Hersi is indebted to the tune of several hundred billion that she borrowed from different financial institutions to set up her empire. She recently declared a bid to run for the Uganda National Chamber of Commerce and Industry presidency against current President Olive Kigongo and businessman Andrew Rugasira.
Insiders blew the lid on her heavy indebtedness wondering how a person who was recently seeking a government bailout should vie to lead an organisation to promote trade and industrialisation.
One of the other complaints raised was that Hersi is not from Uganda as her family emigrated from Somalia to Kenya, before she started trading in Uganda in the late 80s. Hersi addressed the issue while declaring her bid.
“This position is purely business and there is a law in Uganda that is anti-sectarian, so if the law has been put there that anybody can do business in Uganda, why shouldn’t I vie,” she said.
The elections that were supposed to be held on December 16 have since been suspended by Trade and Industry minister Amelia Kyambadde citing “concerns by the stakeholders.”
Foiled bailout plan
Mid this year, a list of 66 distressed companies which were seeking government bailout to the tune of Shs1.3 trillion leaked with names like Patrick Bitature’s Simba Group and Sikander Lalani’s Roofings Ltd prominent on the list. Hersi was on the list through her Horyal Investments Holding Company Limited, a sugar processing venture in northern Uganda that is yet materialise. She was indebted to the tune of Shs120bn borrowed from Crane Bank. That amount was a big chunk of the non-performing Loans that led to recent Bank of Uganda takeover of Crane Bank.
While making its claim for the government bailout that totalled to almost 10 per cent of the total figure, Horyal Investments stated that they employ 10,000 people and their jobs would be at stake in case the government didn’t come in to save the company. However, Daily Monitor in its July 25th story quoting experts like Dr Fred Muhumuza, an economist working with the Financial Sector Deepening Project Uganda (FSDU) on why government shouldn’t bail out the companies stated that Horyal had inflated its employment figures in a bid to present a case for themselves.
“Horyal claims to employ 10,000 people …. However, according to the company directors, 1,200 people would get direct jobs to support about 5,000 out-grower farmers. This is why the government must verify what these companies claim,” Monitor reported.
Sources indicate that much of the money borrowed by Horyal for the Atiak sugar venture was taken out of the country and invested in other interests, leading to the company in dire need for a government bailout which didn’t materialise.
Away from the bailout, Horyal’s venture that was supposed to start producing sugar this year has left a bitter taste both for the owners and locals in Atiak over land wrangles. Many locals protested the move of Horyal taking over 15,000 acres of land for the sugar venture saying it was their farmland and their source of livelihood. After area leaders convinced locals that the move would help in development of the area including provision of jobs, some were not convinced, leading to burning of 16 acres of sugarcane by unidentified locals who were opposed to the move earlier this year. The company estimated the loss resulting from the arson at Shs150m.
No stranger to land wrangles
Amina Hersi is no stranger to land wrangles having been involved in a battle with Centenary Park’s Sarah Kizito when she was setting up Oasis Mall in 2008. Hersi’s Khadar Investments and Kizito’s Nnalongo Estates were involved in a battle with Kizito accusing Hersi of encroachment. Kizito was also surprised that her lease did not allow her to set up permanent structures in Centenary Park, a green belt in the city that is also a swamp yet her neighbour Hersi was constructing a concrete mall. Environmental activists raised a red flag over Oasis Mall encroaching on a swamp which could adversely affect Kampala’s drainage, but Hersi was unfazed as she is said to be well connected to the government as she has built alliances with top politicians like Foreign Affairs Minister Sam Kutesa.
In fact her connections saw her acquire the Laburnam Courts land in Nakasero. At the opening Of Laburnam Courts, in November 2013, President Museveni who presided over the function said Hersi approached him asking for a then vacant piece of land just below All-Saints Cathedral in Nakasero to build apartments.
“If you saw this land, it was just a valley where those who go to church would park their cars and also come to relax; but see what she has done here,” Museveni said.
Museveni also revealed at the same event that she benefitted from other incentives like importing building materials without paying taxes. The president said he protected her from URA officials who were demanding taxes from her!
The Laburnam project needed at least Shs151bn and President Museveni asked Hersi whether she had the money. In a 2014 New Vision interview, Hersi confessed that she lied to him. “In truth, all I had was my resolve, a family name in Kenya and a good track record in doing business in Uganda.”
To see Oasis Mall and Laburnam projects come to fruition, Hersi had to borrow but most local banks turned away and she got an unspecified sum of money from Barclays Bank in Kenya. The project increased her business portfolio but her indebtedness in equal measure.
Who is Hersi
Born in 1963, Hersi learnt business from her mother who took over running of the family business after her father passed away when she was just nine. She started out with a small nail shop in the early 1980s and started selling Bamburi Cement to Uganda in the late 1980s. In fact her first business in Uganda won her the moniker Amina Omusementi.
She permanently moved to Uganda in 1998 after the loss of her two daughters in an accident in Kenya. Her mother suggested that she moves to Uganda in order to heal. Business magnet Sudhir Ruparelia helped her settle in as she had been his client with Crane Forex Bureau. “He gave me office space for three months and also a BMW to easily settle in because my Mercedes had Kenyan number plates,” Hersi revealed in a 2014 interview with New Vision.
Sudhir through his Crane Bank was to remain a major financier of her ventures including her Shs120 billion debt that put her on the bailout list and contributed to the takeover of Crane Bank after her failure to pay back.