MRML Business Plan 06.05.2021

BUSINESS PLAN
ON THE
DEVELOPMENT
AND
OPERATION
OF A
REGIONAL MARKET & LOGISTICS HUB
AT
MUTUKULA
ON THE UGANDA-TANZANIA BORDER
BY
MUTUKULA REGIONAL MARKET LIMITED

P.O. BOX 25391,
KAMPALA,
UGANDA.
PHONES: +256-704-729 280|774-771 682|788-305 933
EMAIL: kamarakameke@gmail.com
APRIL 2021
i
A. TABLE OF CONTENTS
S/NO. DESCRIPTION PAGE
1.0 EXECUTIVE SUMMARY 1

1.1 Introduction 1
1.2 Overview & Project Objective 2
1.3 MRML Project Location 2
1.4 Market Site & Building Layout 3
1.5 MRML Products/Services Profile 4
1.6 MRML Organization 4
1.7 Marketing 5
1.8 Project Budget and Funding 5
1.9 Project Financial Performance 5
1.10 Break-Even Success 7
1.11 Loan Interest & Repayment 8
1.12 Economic Feasibility and Impact 8
1.13 Project Implementation Schedule 8
2.0 BACKGROUND AND PROJECT CONCEPT 9

2.1 High-Level Country Economic Analysis 9
2.2 Introduction 11
2.3 Market Location and Its Surroundings 11
2.4 Background of the Market 12
2.5 Vision 12
2.6 Mission 12
2.7 Project Slogan 12
2.8 Who We Are 12
2.9 MRML Management Team 13
2.10 Strategic Objectives of Mutukula Regional Market 15
2.11 Justification for the Project 15
2.12 Description of the Project 19
MRML REGIONAL CONCEPT & DESCRIPTION OF TRADE, INDUSTRY

3.0 AND INVESTMENT OPPORTUNITIES 24
3.1 MRML Regional Concept 24
3.2 The Role of Partner States in Promoting the Market 24
3.3 Description of Trade, Industry and Investment Opportunities at MRML 25
Business Plan Corporate Document

ii
4.0 MARKET ANALYSIS 31
4.1 Market Trends 31
4.2 Market Plan and Strategy 35
4.3 Revenue Analysis Estimated from the Project 40
5.0 LEGAL AND REGULATORY REVIEW 43

5.1 Legal Form 43
5.2 Licenses, Approvals and Consents Required 43
6.0 MARKET OPERATIONS, DESIGN & CONSTRUCTION 45

6.1 Market Design and Construction 45
6.2 Layout and Circulation 47
6.3 Access 47
6.4 Storage 48
6.5 Delivery and Loading 48
6.6 Restrooms 48
6.7 Exterior Façade 48
6.8 Signage 48
6.9 Utilities 49
6.10 Ventilation and Food Preparation 49
6.11 Floors and Ceilings 50
6.12 Open Air Market 50
6.13 Physical Security 51
6.14 Other Building Uses 51
7.0 START-UP OPERATION REQUIREMENTS AND PROCEDURES 53

7.1 Pre-Opening Requirements 53
7.2 Proposed Operating Requirements 54
8.0 ENVISAGED INSTITUTIONAL AND OPERATING ARRANGEMENTS 55

8.1 Running of the Company, Roles and Responsibilities 55
9.0 OPERATING COSTS ESTIMATES AND JUSTIFICATIONS 70

9.1 Direct Cost Assumptions 70
9.2 Overhead Expense Assumptions 70
9.3 Depreciation 70
9.4 Interest Expense 71
9.5 Taxation 71

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10.0 FINANCIAL VIABILITY ASSESSMENT 72
10.1 General Assumptions 72
10.2 Assumptions to the Economic Projections 72
10.3 Projected Income Statement Assumptions 73
10.4 Balance Sheet Assumptions 74
10.5 Financing Arrangements and Source of Finance 76
10.6 Financial Statements 77
10.7 Project Viability 81
11.0 IMPLEMENTATION SCHEDULE 83
12.0 MONITORING MARKET DEVELOPMENT AND IMPACT 85

12.1 Objective of Monitoring and Evaluation 85
12.2 Monitoring and Evaluation Indicators 86
13.0 PROJECT BENEFICIAL IMPACTS 87

13.1 Trade & Industrial Benefits of MRML to Regional & Global Communities 87
13.2 Other Considerations/Economic Analysis 93
14.0 CONCLUSIONS 95
14.1 Statutory Requirements 95
14.2 Traffic Arrangements 95
14.3 Regional Market Infrastructure Development 95
14.4 Organization 95
14.5 Marketing 96
14.6 Client Recruitment 96

iv
B. LIST OF TABLES
T/NO. DESCRIPTION PAGE
1 Key Project Performance Parameters 6
2 Estimated Project Cost 21
3 Construction Schedule 23
4 Pricing Strategy 40
5 Market Levy Fees 41
6 The Company Shareholders 43
7 Required Licenses, Approvals and Consents 44
8 Direct Costs 70
9 Administrative Expenses 70
10 Depreciation of Assets 71
11 Floor Use 74
12 Break-Even Analysis in Project Year 5 77
13 Initial Project Investment Cost 78
14 Annual Production Cost at 100% Capacity 79
15 Change in CAPEX Cost 81
16 Change in Rates/Square Metre and Fee 82
17 Change in Direct Expenses 82
18 Monitoring and Evaluation Impact Indicators 86
19 Key Financial Modeling Assumptions 97

19-1: Operating Assumptions 97
v
19-2: Economy-Related Assumptions 97
19-3: Working Capital calculation Assumptions 97
19-4: Annual Revenue Assumptions 98
19-5: Annual Expense Operating Assumptions 98
19-6: Financial Assumptions 99
19-7: Depreciation Rate Assumptions 99

vi
C. LIST OF FIGURES
F/NO. DESCRIPTION PAGE
1 Projected Financial Performance Highlights 6
2 Graph showing Uganda’s GDP growth rates for the past 10 years 10
3 East Africa 17
4 Site Plan for the Project 22
5 Proposed Rutepi 5-Star Hotel 30
6 Proposed Rutepi 5-Star Hotel 30
7 Market Design and Development Process 46
8 MRML Organizational Structure 56
9 Chart Showing Project Team Structure 67
10 Project Implementation Schedule 84
11 East African Heads of State at a Previous Summit Meeting 92

vii
D. LIST OF FINANCIAL ANALYTICAL SCHEDULES
01: Key Financial Modeling Assumptions 97
02/1: Project Budget 100
02/2: Source and Structure of Project Financing 102
03: Loan and Interest Service Schedule 103
04/1: Calculation of Working Capital: I Minimum Requirements of Current Assets and Liabilities 104
04/2: Calculation of Working Capital: II Consolidated Annual Income Estimates 105
04/3: Calculation of Working Capital: III Annual Production Cost – Estimates 107
04/4: Calculation of Working Capital: IV Working Capital Requirements 109
05: Fixed Assets and Depreciation Allowances 111
06: Change in Total Investment Costs 113
07: Change in Total Assets 114
08: Projected Cash Flow Table 116
09: Projected Cash flow Table and Calculation of Present Value 118
10: Projected Income Statement 120
11: Projected Balance Sheet 122
12: Business Ratios/Ratio Analysis 124
13: Projected Payback Period 128

viii
E. LIST OF ANNEXURES
I: Mutukula Regional Market Launch Pictorial 130

ix
LIST OF ABBREVIATIONS
AfCFTA : African Continental Free Trade Area

BOD : Board of Directors
CAPEX : Capital Expenditure
CEO : Chief Executive Officer
COMESA : Common Market for Eastern and Southern Africa
DD : Drawing Design
DIC : Directorate of Immigration and Citizenship
DRC : Democratic Republic of Congo
DSCR : Debt Service Coverage Ratio
EAC : East African Community
EAMU : East African Monetary Union
EBITDA : Earnings before Interest, Tax and Depreciation
EIA : Environmental Impact Assessment
FC : Foreign Currency
FDI : Foreign Direct Investment
GDP : Gross Domestic Product
GM : General Manager
GMP : Good Manufacturing Practice
GoU : Government of Uganda
ICT : Information and Communication Technology
ISD : Internal Structural Design
IT : Information Technology
IRR : Internal Rate of Return
KCCA : Kampala Capital City Authority
KPIs : Key Performance Indicators
LC : Local Currency
MAAIF : Ministry of Agriculture Animal Industry and Fisheries
MATIP : Markets & Agricultural Trade Improvement Projects
MD : Managing Director
MDAs : Ministries, Departments, and Agencies
MLHUD : Ministry of Lands, Housing and Urban Development
MoLG : Ministry of Local Government
MNCs : Multi National Companies
MRML : Mutukula Regional Market Limited
MTC : Mutukula Town Council
MTIC : Ministry of Trade, Industry and Cooperatives
NDA : National Drug Authority

x
NGOs : Non-Governmental Organizations
NOTU : National Organization of Trade Unions
NSSF : National Social Security Fund
OPEX : Operating Expenses
OSBP : One-Stop-Border-Post
NPV : Net Present Value
PWDs : People with Disabilities
RFP : Request for Proposals
ROI : Return on Investment
SADC : Southern African Development Community
SD : Structural Design
SMEs : Small and Medium Enterprises
SSTPA : Safe and Secure Trucking Parking Area
UAE : United Arab Emirates
UGX : Uganda Shillings
UK : United Kingdom
UIA : Uganda Investment Authority
UMI : Upper Middle Income
UNBS : Uganda National Bureau of Standards
UNCCI : Uganda National Chamber of Commerce and Industry
UPF : Uganda Police Force
URA : Uganda Revenue Authority
URSB : Uganda Registration Services Bureau
USA : United States of America
USD : United States Dollar

1.0 EXECUTIVE SUMMARY
1.1 Introduction
The Mutukula Regional Market Phase I is a unique and multi-specialty integrated

market complex. It is a dedicated platform for all entrepreneurs ranging from the large,
medium, small to micro. It is envisaged that the market because it will bring together
entrepreneurs and cross border venders from; Uganda & Tanzania as well as from
other partner states such as Kenya, Rwanda, Burundi, Southern Sudan and
Democratic Republic of Congo.
The design and set up of the market complex as a logistical hub will be defined by the
following key features: a cold storage unit; six (6) tower grain silos; six hundred (600)
warehouses; an international convention and permanent exhibition center (with 30,000
stalls, 10,000 shops); shopping malls; mechanical workshops and sale of spare parts;
welding workshop; carpentry workshops; service and washing bays; fuel stations;
banks; forex bureau; recreational facilities, educational facilities and an administration
block. These facilities are intended to support the common activities of trading. The
sharing of these facilities is critical in fostering regional integration and cooperation, in
terms of social cohesion.
Adding to the beauty of the market, will be a five-star hotel with 300 room capacity,
multipurpose conference facilities, bars and lounges, restaurants, gymnasium, sauna,
swimming pools and a tennis court.
The market will also host a 300 bed, International Hospital Mutukula will comprise of
Cardio Thoracic Intensive facility, Coronary Care facility, High Dependency facility,
Medical and Surgical Intensive Care facility, Neonatal Intensive Care facility, and
Paediatric High dependency facility.
The construction of the market complex Phase I is estimated to cost US$763 million
when all the facilities are complete and in place. This will cover the capital investment
for the buildings, infrastructure development and equipment.
The market and all other facilities will generate about 50,000 new direct employment
opportunities at full development and 2,500,000 indirect employment opportunities in
associated activities. The employment opportunities will be in trade and enabling
services targeting specific groups such as the youth, women, and PWDs.

1
1.2 Overview & Project Objective
Mutukula Regional Market aims at introducing a unique and multi-specialty market,

one of its kind in the East African region. The market will enhance regional cooperation,
with the facilities being shared among all the traders, investors and manufacturers in
the Eastern African region. It is designed to create an enabling environment for
increased trade flow among partner states. With its location at the heart of East Africa, it
is positioned at the intersection of the major trade routes in the region and thus able to
act as a central point for intra-Eastern Africa trade. The regional market aims at
connecting and uniting vendors in Uganda, Kenya, Tanzania, Rwanda, Burundi,
Southern Sudan and Western part of Democratic Republic of Congo.
The proposed establishment of a permanent regional market at Mutukula has the

following strategic objectives;
1. To create employment opportunities in trade and enabling services including

programs targeting specific groups such as the youth, women, PWDs, among
others.
2. To create an East African regional sales point for merchandise and traders and
manufacturers within the region.
3. To conduct research into intra-East African trading opportunities, challenges,
threats, emerging trends, best practices and innovations.
4. To lobby and advocate for increased intra-East African trade and creating an
enabling environment for trading and production within the East African states.
5. To contribute to the socio-economic transformation of the East African
Community.
6. To promote business by bringing together all stakeholders‟ synergies enhancing
trade, industry and investment in the region.
1.3 MRML Project Location
The precise location of the new plot of land for the proposed development of the
Mutukula Regional Market Limited complex [MRML] will be at Mutukula on the
Uganda-Tanzania border. Mutukula is located about 222 kms from Kampala (the
Ugandan capital) which is a 4 hour and 20 minutes drive by tarmac road and about
1,460 kms from Dar es Salaam Port in Tanzania or about 23 hours drive by road.

2
1.4 Market Site & Building Layout
 The size of the MRML Complex Plot is 466 Acres.

 The MRML Complex logistics hub will comprise of space for 1,000 warehouses
and commercial parking space for trucks and other light cargo vehicles (10
Acres) as well as a leasable area for a container freight station (CFS), logistics,
land cargo-freight and all kinds of business operators under one single roof.
 MRML Complex will have five (5) stories (above ground) with each one having
4,000 stalls/shops totaling out to 50,000 stalls/shops.
 The entrance will be from the street right to the inner circle which will allow for
have eye contact with all three stories and daylight from the transparent roof.
 From the circle, there will be an elevator and the stairs leading to the walkways
on every floor which will distribute the public to the various stores/stalls/shops,
according to their functions.
 Since the commercial building plot area is about 16,000 m² and the basement
two-story parking area will be using the total commercial building plot. We will
have about 300 to 600 vehicles per story. It means 600 to 1,200 vehicles will be
parking in the MRML Complex building.
 The market building/complex will be design in accordance with modern and
artistic design standards so as to attract intense public curiosity and serve as a
landscape trademark for the regional market.
 These building design specifications in Phase I of MRML Project development
are only basic and will be modified and improved upon in the ongoing
development process to comply with the specified industry standards and
criteria.
The layout of the market, to be more fully developed during the design process, should
emphasize ease of customer circulation and flexible public spaces that can be used for
seating, demonstrations and market stalls/shops.
The subsequent phases of the MRML development will improve the streets and
roadways surrounding the Complex, and erect artistic building structures to meet
modern services and trading standards with increased capacity. The increase in modern
warehousing, commercial parking, storage and distribution facilities will also allow the
MRML Complex to better attract and incubate additional high-quality businesses,
clients and business traffic to the MRML Complex, and also allow it to meet the needs
of the 21stcentury regional trading markets sector. At full build-out, estimated in 2026,
the Market will occupy up to 86,111,283 square feet.

3
1.5 MRML Products/Services Profile
The design and set up of the Mutukula Regional Market Complex as a logistical hub
will be defined by the following key features: 300 market shades; and commercial truck
parking space/yard and other spaces for offices; 5-star hotels; restaurants; banking
halls; clinics, an international hospital; health clubs; cinemas; conference halls;
commercial buildings; grain-drying and cleaning equipment; petrol stations; livestock
market and abattoir; a cold storage unit; six (6) tower grain silos; one thousand (1,000)
stalls, 50,000 shops); mechanical workshops and sale of spare parts; welding workshop;
carpentry workshops; service and washing bays; fuel stations; forex bureaus;
recreational facilities; educational facilities and an administration block. These facilities
are intended to support the common activities of trading. The sharing of these facilities
is critical in fostering regional integration and cooperation, in terms of social cohesion.
1.6 MRML Organization
The Mutukula Regional Market Complex will require a full-time staff as well as part-
time staff to oversee the development and progress of the Regional Market as a
professional business and cultural amenity for Uganda as well as the entire East
African Community [EAC] (Please refer to Section 8.1 Running of the Company,
Roles and Responsibilities on pages 55-66 of this Business Plan).
The management structure of Mutukula Regional Market Limited [MRML] will be

spearheaded by a Board of Directors who will delegate their authority for the day to
day activities to an operation team led by a Chief Executive Officer (CEO). The CEO
will supervise the General Manager will also supervise the Operations Manager,
Production Manager, Procurement Manager, Internal Audit Manager, Finance &
Administration Manager, and Human Resource Manager. The Managers will have
departments that be staffed with Assistants and other Officer depending on need and
strategic analysis of the market operations.
The General Manager will also oversee representatives from the East African Countries
including; Kenya, Tanzania, Uganda, DRC, Rwanda, Burundi and South Sudan. The
institution will employ qualified and experienced individuals as described in the
established recruitment policy.
In order to achieve our objective as a regional market bringing together entrepreneurs

4
and cross border from the region, management of the market will work with a Multi-
sectoral team adopted from all the Ministries, Department and Agencies (MDAs) of
Government which interface with cross border business in their day to day operations
such as: Uganda Revenue Authority (URA); Ministry of Trade, Industry and
Cooperatives (MTIC); Ministry of Agriculture, Animal Industry and Fisheries
(MAAIF); Directorate of Immigration and Citizenships (DIC); Uganda National
Bureau of Standards (UNBS); National Drug Authority (NDA) and the Uganda Police
Force (UPF).
1.7 Marketing
A commitment to advertise and promote the MRML Complex based on professional

materials that will draw people to the Regional Market complex. An appeal to all
residents of the East African Community [EAC] as well as tourists based on an
authentic MRML experience will be well received.
1.8 Project Budget and Funding
The total cost of implementing the MRML regional market project is estimated to be at
least US$777.71 million, including design, build-out, construction contingency pre-
opening expenses and initial working capital. The construction budget is order-of-
magnitude and will need to be recalculated during the market design process. It is
critical that the market operator (MRML) and Project Management Team have access to
sufficient working capital and that sufficient funding to the tune of US$777.71 million
is raised to fully cover all the costs involved in the design, build-out, construction
contingency pre-opening expenses and commissioning components of the proposed
MRML regional complex.
1.9 Project Financial Performance
The total project cost for construction and development of the Mutukula Regional
Market (MRM) is estimated at US$799.635 million. The total project cost includes the
market value of existing land at the present market site at Mutukula (466 acres valued
at US$21.924 million approx.) that represent a project promoter‟s equity stake of 2.74%
and a regional market construction budget of US$777.71 million representing a loan
value of 97.26%. The project NPV is around US$217,901,822 at a discount factor of 12%,
with an IRR of 16.23%, payback period of 7.20 years (7 years and 10 weeks) and Break-
even capacity utilization of 22.89%.

5
The MRM development budget consists of acquisition costs at US$22,407,860 (3.06% of
project budget); hard costs at US$689,580,200 (94.02% of project budget); and soft costs
amounting to US$20,450,000 (2.78% of project budget). Soft costs on their own include
several components of their own such as the public RFP process (0.02% of project
budget); design/permitting/consultants (1.02% of project budget); development fees
0.01% of project budget); legal/public relations (0.04% of project budget); and financing
carry costs (0.01% of project budget); and other soft costs (1.83% of project budget).
We project the MRM revenue turnover to increase from more than US$162,072,000 in
the first year (Project Year 6 or 2026) to US$196,999,529 in the tenth year (Project Year 10
or 2030), and eventually peaking up toUS$320,891,474 in the twentieth year (Project
Year 20 or 2040). Out of these amounts, pre-tax profits (operating profits) increase from
US$79,154,982 in Project Year 6 and US$262,673,112 in Project Year 20.
Relevant ratios such as the percentage of net profit to total sales, return on equity and
return on total investment show promising returns (Refer to Schedule 12 on page 124 –
127).
Investment cost and income statement projection are used in estimating the project
payback period. The projects will payback fully the initial investment in 7.20 years
(7years and 10 weeks) (Refer to Schedule 13 on page 128 – 129).
NOTE: All currency figures in this plan are in US$.

6
Figure 1: Performance Highlights (PY2 – PY6)
Sales Gross Margin Net Profit
200,000,000
180,000,000
160,000,000
140,000,000
120,000,000
US$
100,000,000
80,000,000
60,000,000
40,000,000
20,000,000
0
2026 2027 2028 2029 2030
Table 1: Key Project Performance Parameters (US$)

KPI/Year 2026 2027 2028 2029 2030
Revenues 162,072,000 170,175,600 178,684,380 187,618,599 196,999,529
Operating Profit 159,974,422 167,973,893 176,373,338 185,192,755 194,453,142
Tax 23,746,495 26,056,168 29,200,001 32,469,826 35,871,943
Net Profit / [Loss] 55,408,487 60,797,725 68,133,336 75,762,928 83,701,200
Gross Margin 98.79% 98.79% 98.79% 98.79% 98.79%
Operating Margin 98.71% 98.71% 98.71% 98.71% 98.71%
Net Margin 34.19% 35.73% 38.13% 40.38% 42.49%
Return on Investment 6.93% 7.60% 8.52% 9.47% 10.47%
Fixed Assets Turnover 0.003 0.003 0.003 0.004 0.004
Debt Coverage Ratio 1.33 1.37 1.47 1.58 1.71
Times Interest Earned Ratio 5.14 5.77 6.52 7.42 8.50
Break-even Point (BEP): USD 45,099,592 at a capacity utilization of 22.89%

Payback Period (Loan): 7.20 Years
NPV at 10%: USD 360,178,161
IRR: 16.23%
1.10 Break-Even Success
Sources of income for the MRM Complex include aggregate annual revenues from the
1,000 warehouses, 300 market shades and 50,000 shops, commercial parking space,

7
commercial buildings, international hospital and 5-star hotel, and other regional market
facilities. The operator (MRML) will achieve break-even status at an average of US$
10.94/sq. ft. for permanent tenants – with annual sales of US$45,099,592. Market
turnover sales should be able to sustain higher cash flows, however. Using the Huff
Gravity Model, we estimated that the MRML regional market complex has the potential
to capture US$165.6 million to US$223.2 million in annual revenues, so the break-even
level is well within the range of feasibility.
1.11 Loan Interest & Repayment
Details of medium-term loan repayment appear in Schedule 03 (page 102). Loan

repayments start off in the third year after completion of the two year grace period
(Project Years 1-5 or 2021-2025) and are fully recovered and discharged by the end of
the twentieth year of the project (Project Year 20 or by 2040).
1.12 Economic Feasibility and Impact
The MRML Complex will have significant economic benefits, with revenues of at least
US$162,072,000 in Project Year 6 [2026] that eventually builds up US$320,891,474 in
Project Year 20 [2040]. In addition, the MRML Complex will create more than 50,000
new direct employment opportunities at full development and 2,500,000 indirect
employment opportunities in associated activities. These job opportunities will be in
trade and enabling services targeting specific groups such as the youth, women, and
PWDs.
1.13 Project Implementation Schedule
It is expected that it will take approximately 60 months to complete the construction

Phase 1 of the MRM Complex that should then be ready for commissioning and
commencement of trading activities by the end of the Fourth Quarter of 2025 (refer to
Project Implementation Schedule on page 83). The project‟s preparatory stages include
four (4) distinct phases with overlapping schedules namely: acquisition (18 weeks);
permitting (42 weeks); design (54 weeks); and pre-construction (42 weeks) that will all
be on course of being completed by the end of the Second Quarter of 2022.

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2.0 BACKGROUND AND PROJECT CONCEPT
2.1 High-Level Country Economic Analysis
Over the past three decades Uganda has established a strong record of prudent macro-
economic management and structural reform. It was one of the first Sub-Saharan
African countries to embark on liberalization and pro-market policies in the late 1980s.
Since then, the government has maintained a stable macroeconomic environment and
sustained private sector-oriented reforms that graduated Uganda into a mature
reformer in 2006. GDP growth accelerated from an average of 6.5 percent per year in the
1990s to over 7 percent during the 2000s. Growth remained well above the Sub-Saharan
Africa average in the face of consecutive exogenous shocks, including the secondary
effects of the global economic crisis, bad weather and surges in international
commodity prices.
Economic Outlook in 2020 and Beyond
Uganda‟s real gross domestic product (GDP) grew at 2.9% in FY20, less than half the
6.8% recorded in FY19, due to the effects of the COVID-19 (corona virus) pandemic.
GDP is expected to grow at a similar level in FY21.
Economic activity stalled during the latter part of FY20 due to a domestic lockdown that
lasted more than four months, border closures for all but essential cargo, and the
spillover effects of disruptions to global demand and supply chains. This resulted in a
sharp contraction in public investment and deceleration in private consumption, which
hit the industrial and service sectors hard, particularly the informal service sector.
On a calendar year basis, real GDP growth is expected to contract by up to 1% in 2020,

compared to 7.5% growth in 2019, and, as a result, real per capita GDP growth is
expected to contract by about 4.5%. Even if GDP growth rebounds strongly by 2022, the
level of per capita GDP is likely to remain well below its pre-COVID trajectory.
The medium-term outlook for Uganda has worsened considerably due to the impact of
COVID-19, and risks are tilted heavily to the downside. If the impact of COVID-19 lasts
longer globally, or the virus spreads more widely in Uganda, this could deter the
recovery in Uganda‟s exports, adversely impact a rebound in foreign direct investment
(FDI), tourism and remittances, and further depress productivity and hence the
domestic economic recovery. Such developments could lead to more severe social and
economic impacts and amplify external and fiscal imbalances.
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Furthermore, while lower oil prices are beneficial to Uganda‟s trade balance and real
growth outcomes, they also mean increasing risks to investment plans in the Ugandan
oil sector, which was expected to start producing and exporting by 2024/25. Finally,
heightened uncertainty in the post-2021 election period and weather shocks could
further exacerbate the aforementioned risks.
Government Policy on Markets Development
The Government of Uganda has created a conducive environment for investors and this
is enshrined in its Vision 2040, where one of the pillars is development of
entrepreneurship and the private sector and one of the strategies is to eradicate mass
poverty and ensure rural transformation. The government through the Ministry of
Local Government has formed Markets & Agricultural Trade Improvement projects
(MATIP) to increase agricultural productivity and hence rural household incomes
through investment in market infrastructure. Through the same ministry policy
decisions on the development and management of markets in Kampala Capital City
Authority (KCCA), municipalities and towns were passed which indicated that
privatemarket developers and entrepreneurs shall be free to develop their own markets
on condition that they can mobilize funds, construct modern markets and receive
planning permission from respective local councils and town planning departments.
Figure 2: Graph showing Uganda’s GDP growth rates for the past 10 years
Annual GDP Growth rate Annual GDP per Capita Growth rate
10.00%
8.00%
6.00%
4.00%
2.00%
0.00%
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
-2.00%
Source: World Bank data 2021

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2.2 Introduction
Mutukula Regional Market aims at introducing a unique and multi-specialty market,

one of its kind in the East African region. The market will enhance regional cooperation,
with the facilities being shared among all the traders, investors and manufacturers in
the Eastern African region. It is designed to create an enabling environment for
increased trade flow among partner states. With its location at the heart of East Africa, it
is positioned at the intersection of the major trade routes in the region and thus able to
act as a central point for intra-Eastern Africa trade. The regional market aims at
connecting and uniting vendors in Uganda, Kenya, Tanzania, Rwanda, Burundi,
Southern Sudan and Western part of Democratic Republic of Congo.
2.3 Market Location and Its Surroundings
In 2017, the border crossing between Mutukula, Uganda and Mutukula, Tanzania was
converted into a one-stop-border-post (OSBP), open 24 hours every day of the year.
Vehicles, passengers, luggage, merchandise and pedestrians are cleared once by
customs and immigration staff from both countries, at a station in the country of entry.
This cuts the time it takes to cross by anywhere from 30 percent to 50 percent. Other
stakeholders report reduction in crossing times by as much as 90 percent. As of July
2009, the population of Mutukula was estimated at 15,000 people.
Mutukula is located in extreme southern Kyotera District at the international border

between Uganda and Tanzania. The town is approximately 81 kilometers (50 mi), by
road, south-west of Masaka, and the largest city in the sub-region. This location is
approximately 211 kilometers (131 mi), by road, south-west of Kampala, the capital and
largest city of Uganda. The coordinates of the town are 1°00‟00.0′′S, 31°25‟00.0′′E
(Latitude:-1.0000; Longitude: 31.4167).
The town of Mutukula is a border town between Uganda and Tanzania. At an altitude
of 1,190 meters (3,900 ft), above sea level, Mutukula is an important border post and
major crossing point, for both human and commercial traffic. In 2017, the border post
between both Tanzania and Uganda merged operations on both sides. Vehicles and
passengers clear customs and immigration once in the country they are leaving, with
officials from both countries present.
The following additional points of interest lie within the town limits or close to the
edges of the town: (a) offices of Mutukula Town Council;(b) Mutukula Airport, a
military and civilian airport, located approximately 10 kilometers north of town;(c)
11
Mutukula prison, a medium-security corrections facility;(d) Mutukula central
market;(e) and the Border Post. The Immigration Check Points include; Busia, Malaba,
Katuna, Mpondwe, Mutukula, Mirama hills /Kagitumba, Nimule / Elegu.
2.4 Background of the Market
In the Eastern African region, regional integration is making steady progress; efforts are
being made to develop regional value chains that are aimed at strengthening the
competitiveness of the region and importantly creating more pressure for further
integration hence attaining more benefits for the region.
The essence of Regional Integration Arrangements is to increase the intra-trade among

the member states. The East African states including Kenya, Uganda, Tanzania,
Rwanda, Burundi, South Sudan and Democratic Republic of Congo (DRC) has a
population of over 172 million which represents a huge a potential for intra-trade in
goods and services.
2.5 Vision
The Vision of Mutukula Regional Market is to become the preferred world class
leading regional market solution in the East African region.
2.6 Mission
To build on and sustain socio-economic transformation through the provision of world

class facilities and services to the agricultural and non-agricultural production, trade
and industry
2.7 Project Slogan
Mutukula Regional Market is guided by an outstanding Project Slogan title “United

Together for Development”
2.8 Who We Are
Mutukula Regional Market “The leading national network for farmers” has its head
offices along Ggaba road on Susie building next to the American embassy. It is basically
concentrated in the production and exportation of Agro-based products to Asian giants
in China and India. Mutukula Regional Market is a forum for all entrepreneurship
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community ranging from micro-enterprise, cottages and small scale industries in
Uganda, with a vision of transforming red mentally skills of „young‟ entrepreneurs into
competitive skills so as to improve on their business performance and offer solutions to
their market problems. We are registered by the registrar of companies under section
16(1), incorporated with limited liability Reg. certificate number P.545.
We are a regional market because that aims at uniting the vendors in Uganda, Kenya,
Tanzania, Rwanda, Burundi, Southern Sudan and Western Part of the Democratic
Republic of Congo.
2.9 MRML Management Team
“Mutukula Regional Market” expects to hire over 50,000 employees. The Market board
of directors will select the general and assistant manager, operations manager, general
secretary, accounting office, Human Resource office and representatives from each
member of the East African community. The other staff shall be directly chosen by the
General Manager and his staff.
The Executive Board of director shall have control over the General Manager in the
control and management of the Market. The Market shall adopt an effective interview
process designed to staff the Market with highly qualified people for each position.
Each applicant will be related and evaluated according to a pre-defined set of standards
13
designed for each position. Background checks will be utilized for designated positions.
Recruiting efforts will always center on referrals.
Mr. KalamagiKalim Mr. Mozdzenski Michael Jan Mr. SsengendoLauben

Founder & CEO Senior Business Advisor General Manager
Ms. Claire Mr. Nabimanya Norman Ms. Naggirinya Irene

Operations Manager General Secretary Accounting Officer
Site Planners
at the Site

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2.10 Strategic Objectives of Mutukula Regional Market
The proposed establishment of a permanent regional market at Mutukula has the

following strategic objectives;
1. To create employment opportunities in trade and enabling services including

programs targeting specific groups such as the youth, women, PWDs, among
others.
2. To create an East African regional sales point for merchandise and traders and
manufacturers within the region.
3. To conduct research into intra-East African trading opportunities, challenges,
threats, emerging trends, best practices and innovations.
4. To lobby and advocate for increased intra-East African trade and creating an
enabling environment for trading and production within the East African states.
5. To contribute to the socio-economic transformation of the East African
Community.
6. To promote business by bringing together all stakeholders‟ synergies enhancing
trade, industry and investment in the region.
2.11 Justification for the Project
2.11.1 Overview
The founding members of Mutukula Regional Market (MRM) saw the need and plight
of the traders that had disintegrated into smaller markets in the East African region,
making it expensive and difficult for the clients to get quality and value added goods;
most markets are not specialized, there are difficulties in getting all the required goods
and services under the same market. This has led to an influx of people with the need to
travel abroad in the quest to purchase quality goods and services so as to quench the
need for the right quality and quantity of products in East Africa.
2.11.2 Underlying Reasons for Development
MRM decided to acquire land space at Mutukula and develop the market because of
the following reasons:
► Government policy and presidential directive on the redevelopment of markets by

the sitting vendors.

15
► The company has to develop the market in order to compete favourably with the
malls in the up-market urban and sub-urban areas of Uganda, as a modern one-
stop shopping centre located at a busy cross-border entrepot.
► To re-enforce the brand of Mutukula Regional Market as a regional basket of

fresh foods and gain acclaim as a world standard shopping centre.
► To provide socio-economic welfare of the tenants and contribute to national

development since more jobs will be created.
► The need for additional facilities such as cold storage, alternative electric power
generation which are not available in many of the current market set ups around
Uganda and the East Africa region.
► To keep in step with the current trend set in motion by the Government of Uganda
(GoU) in which traditional markets are being transformed into modern shopping
mall structures or regional border crossing point markets that are able to serve the
country‟s nationals and foreign visitors from the world over. It will create up to
1,000 warehouses, 300 market shades, 50,000 shops, and commercial parking space
and other spaces for offices, 5-star hotels, restaurants, banking halls, clinics,
hospitals, health clubs, cinemas, conference halls, commercial buildings, grain-
drying and cleaning equipment, petrol stations, livestock market and abattoir, etc.)
► To add an icon of beauty and elegance that will make the Ugandan and East
African skyline of the city more beautiful and optically satisfying.
► To enable the tenants/traders increase their earnings as a result of more accessible

and smarter business premises, thus help to improve their standards of living.
► Reduction of street vending and illegal stalls and shops in busy East African
customs border posts such as the one at Mutukula, which have caused congestion
on the roads and highways causing traffic jam.
► The need to have a permanent solution to the perennial problems including traffic
congestion, garbage and accessibility.

16
Figure 3: East Africa
Mutukula
► The Government will earn more revenue in terms of taxes and trading licenses as a
result of the new businesses which will be set up in the Mutukula Regional
Market complex.

17
► The project will have the following impacts on the local community and the Small
and Medium Enterprises (SMEs):
► The Project will create direct and indirect employment for the local community
and SMEs. During construction phase the project will employ the local population
for services ranging from technical facilitation to casual support. During this
phase, the local SMEs may be engaged as suppliers and transporters for locally
available building materials. This will reduce economic leakage, and increase the
confidence of investors in locally available goods and services. Also, when
Mutukula Regional Market complex opens doors to its clientele it will create
employment for the local population as staff. This will increase the effect of
economic multipliers, fostering circulation of money within the community and
improving standards of living;
- The project will open up new market opportunities for the local entrepreneurs.
The Mutukula Regional Market complex also opens up extended market
opportunities for supplying locally produced goods and services. This will
encourage local production of goods and directly increase household incomes.
- It will offer accommodation, recreation facilities, training facilities and space for
businesses in the all sectors of the economy. This will directly create business
opportunities for the business community involved in various services like
consultancy, travel operators, beauty parlours and leisure services;
- A bigger market will be created for farm produce.
- The cold room facilities will encourage the vendors/traders to venture into fresh
foods export market.
The development of the Mutukula Regional Market complex will enable the tenants
to operate and run modern market-based businesses in line with the current
international trends existing within the world trade centre markets. The new
Mutukula Regional Market complex will have modern facilities agreeable to the
global trends of real estate developments, bringing closer financial, banking, insurance
as well as recreational services among others. These facilities will enable the traders to
compete favourably with other traders in neighbouring countries within the EAC
region, and attract a larger clientele.

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2.12 Description of the Project
2.12.1 The Envisaged Development
The Mutukula Regional Market Phase I is a unique and multi-specialty integrated

market complex. It is a dedicated platform for all entrepreneurs ranging from the large,
medium, small to micro. It is envisaged that the market because it will bring together
entrepreneurs and cross border venders from; Uganda & Tanzania as well as from
other partner states such as Kenya, Rwanda, Burundi, Southern Sudan and
Democratic Republic of Congo.
The design and setup of the market complex as a logistical hub will be defined by the
following key features: a cold storage unit; six (6) tower grain silos; six hundred (600)
stalls, 50,000 shops); shopping malls; mechanical workshops and sale of spare parts;
welding workshop; carpentry workshops; service and washing bays; fuel stations;
banks; forex bureau; recreational facilities, educational facilities and an administration
block. These facilities are intended to support the common activities of trading. The
sharing of these facilities is critical in fostering regional integration and cooperation, in
terms of social cohesion.
Adding to the beauty of the market, will be a five-star hotel with 300 room capacity,
multipurpose conference facilities, bars and lounges, restaurants, gymnasium, sauna,
swimming pools and a tennis court.
The market will also host a 300 bed, International Hospital Mutukula will comprise of
Cardio Thoracic Intensive facility, Coronary Care facility, High Dependency facility,
Medical and Surgical Intensive Care facility, Neonatal Intensive Care facility, and
Paediatric High dependency facility.
The construction of the market complex Phase I is estimated to cost US$763 million
when all the facilities are complete and in place. This will cover the capital investment
for the buildings, infrastructure development and equipment.
The market and all other facilities will generate about 50,000 new direct employment
opportunities at full development and 2,500,000 indirect employment opportunities in
associated activities. The employment opportunities will be in trade and enabling
services targeting specific groups such as the youth, women, and PWDs.

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The unique and multi-specialty integrated market complex anticipates: to create
employment opportunities in trade and enabling services including programs targeting
specific groups such as the youth, women, PWDs, among others; to develop the market
complex as a key Warehousing and Logistics Hub for the EAC region: providing
modern warehousing and logistics facilities for farmers, traders and manufacturers
within the region; to conduct research into intra-EAC trading opportunities, challenges,
threats, emerging trends, best practices and innovations; to lobby and advocate for
increased intra-EAC trade and by creating an enabling environment for trading and
production within the EAC partner states; and to contribute to the socio-economic
transformation of the EAC.
2.12.2 Key Players
The Government of the Republic of Uganda
Mutukula Regional Market is a unique private establishment and over 50,000 people
will be able to earn a living from the market. The government is responsible for the
welfare of its citizens, and in line with its strategic goals as laid out in Vision 2040, as
well as the MDGs, poverty eradication and standard of living are key priorities in its
agenda. The development of large-scale private markets falls under the auspices of the
Ministry of Trade, Industry and Cooperatives [MTIC] and also the Ministry of Local
Government [MoLG]. The Minister of Trade, Industry and Cooperatives and also the
Minister of Local Government are responsible for policy direction, political oversight
and administrative framework support for development of large-scale regional markets
in Uganda.
Mutukula Town Council (MTC)
Mutukula Town Council (MTC) was recently elevated to town council because of its
strategic location on the Uganda-Tanzania border and owing to its fast-growing
population. The town council is the governing body of Mutukula Town and
administers the town on behalf of the central government. The town council is
empowered to license businesses within Mutukula town and to facilitate development
through vetting investors and their plans. Every physical development in the town of
Mutukula has got to be approved by MTC.
Ministry of Lands, Housing and Urban Development (MLHUD)
The mandate of the MLHUD is to “To ensure rational and sustainable use, effective
20
management of land and orderly development of urban and rural areas as well as safe,
planned and adequate housing for socio-economic development”. As depicted in its
mandate, the Ministry is therefore a key player in the project. Ownership of land,
transactions thereof and developments thereon require the approval of the Ministry
and titles of ownership and lease are vetted and approved by the same.
2.12.3 The Estimated Capital Costs
The cost of the project is estimated at USD 799.64 million. The cost breakdown is as
follows:
Table 2: Estimated Project Cost

Account Head Amount (US$)
Land @ Mutukula [466 Acres] 21,924,000
Buildings & Civil Works 664,624,000
Plant Machinery & Equipment 41,681,000
Water Systems 17,054,000
Electricity Generation Plant 28,651,000
Security Equipment & CCTV Systems 10,462,000
Office Furniture & Fittings 3,439,000
Start-Up Costs 11,500,000
Working Capital Requirements 300,000
Total 799,635,000
2.12.4 Project Site Plan
Below is the site plan for the project;

21
Figure 4: Site Plan for the Project
2.12.5 Implementation/Construction Plan
The sponsors anticipate that subject to the availability of funding, the

construction of the complex would take two years. The implementation of the
construction will be as per the schedule below:

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Table 3: Construction Schedule
Construction Schedule Year 1 Year 2 Year 3 Year 4 Year 5
1000 Warehouses 33.33% 33.33% 33.33% _ _
300 Market Shades 33.33% 33.33% 33.33% _ _
50,000 shops 33.33% 33.33% 33.33% _ _
General Parking 20.00% 20.00% 20.00% 20.00% 20.00%
Commercial Parking 100.00% _ _ _ _
Open Market Yard 100.00% _ _ _ _
International Hospital-Buildings _ 33.33% 33.33% 33.33% _
International Hospital-Equipment _ _ _ _ 100.00%
Five Star Hotel-Buildings _ 50.00% 50.00% _ _
Five Star Hotel-Equipment _ _ _ 100.00% _
Five Star Hotel-Furniture & Fittings _ _ _ _ 100.00%
Lodges-Buildings _ 50.00% 50.00% _ _
Lodges-Equipment _ _ _ 100.00% _
Lodges-Furniture & Fittings _ _ _ _ 100.00%
Commercial Buildings 33.33% 33.33% 33.33% _ _
Children's Park _ _ 50.00% 50.00% _
6 Silos, dryer cleaner, sorting machine _ _ 50.00% 50.00% _
Roads, earthworks and drainage 25.00% 25.00% 25.00% 25.00% _
Electricity Sub-Station & Solar System 33.33% 33.33% 33.33% _ _
Water Plant & Reticulation Systems 33.33% 33.33% 33.33% _ _
6 Petrol Stations 50.00% 50.00% _ _ _
Daycare Centre _ _ 50.00% 50.00% _
Security Equipment & CCTV Systems 20.00% 20.00% 20.00% 20.00% 20.00%
Administration Building 100.00% _ _ _ _
Livestock Market & Abattoir _ 50.00% 50.00% _ _
120 Toilets 33.33% 33.33% 33.33% _ _
Perimeter Wall _ _ _ 50.00% 50.00%
Interior Design Fit-Out 100.00%
Furniture, Fittings & Equipment 100.00%
Exterior Elements/ Facilities 100.00%

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3.0 MRML REGIONAL CONCEPT & DESCRIPTION OF TRADE, INDUSTRY
AND INVESTMENT OPPORTUNITIES
3.1 MRML Regional Concept
Mutukula Regional Market Limited (MRML) is a registered company in Uganda. We

have invested in the establishment and construction of a unique and multi-specialty
integrated market complex at the Mutukula business hub in Kyotera District at the
border between Uganda and Tanzania. The Market specializes in servicing primarily
cross border trade & investment by focusing on improving regional infrastructure and
in particular remove both at and behind the border constraints to regional trade.
In addition, the market is intended to bring to life the operational principles of the
community and promote the four (4) freedoms of movement for all the factors of
production as envisioned in the EAC Common Market Protocol.
As a Mutukula Regional Market, we believe that cross-border, intra- and inter-regional

trade is a tool for stimulating and facilitating the key productive areas of the economies
of the EAC.
3.2 The Role of Partner States in Promoting the Market
The Common Market is an important Regional Integration milestone of the East

African Community (EAC), in line with the provisions of the EAC Treaty.
To accelerate economic growth and development as wished-for by the EAC Common

Market, we as the market implore the EAC Partner States maintain a liberal stance
towards the four (4) freedoms of movement for all the factors of production, these
include; Free Movement of Goods/Services, Free Movement of Persons, Free
Movement of Labour/Workers & Free Movement of Capital and the two (2) Rights
between themselves which include; Right of Residence and Right Establishment in a bid
to promote the community as a single investment area.
As the market we also beseech the EAC Partner States to constantly highlight the
operational principles of the Community, specifically; non-discrimination of nationals
of other Partner States on grounds of nationality and equal treatment to nationals of
other Partner States.

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In reflecting their interests in the possibilities of trade, EAC Partner States should
implement agreements and operationalize protocols on trade to facilitate formal trade
and eliminate barriers to trade.
The construction of the market represents a crucial extension and improvement in

trading relations between Uganda and her regional neighbors such as; Kenya,
Tanzania, Rwanda, Burundi, Southern Sudan and Democratic Republic of Congo.
3.3 Description of Trade, Industry and Investment Opportunities at MRML
3.3.1 Leasing and Booking Warehouses
Each warehouse (360m2- 70 x 50 Ft) will be leased for 25 years at UGX

1,012,000,000in total. The booking of the warehouse can be done as urgent as possible
at UGX 200,000. This money shall be paid in 5 years after which the leaser will continue
collecting fees from sub leasers for more 20 years until the end of 25 years. The leaser

25
will continue paying for utilities like water, electricity and other bills, ground rent and
management fees. The renter or leaser of the ware houses will get connections to sub-
renters and the whole business world guaranteeing them to become landlords. The
renter or leaser will be connected to financial institutions for financial access. Mutukula
Regional Market will guarantee traders and manufacturers who may want to acquire
loans or capital from banks like Centenary Bank, Equity Bank and Uganda
Development Bank. The renter who will want to sell off his or her good will be allowed.
This will be administered by the leaser (seller), purchaser and the administration of the
market.
Through a comprehensive analysis of the potential for trade among the EAC partner
states, Mutukula Regional Market will offer sector space to those products that are
highly sought for among partner states. For instance, instead of a Kenyan trader
transporting products all the way to North Western Tanzania, Rwanda, Burundi or even
DRC, he/she can deliver the said goods to Mutukula Regional Market, where buyers
from Tanzania, Rwanda or Burundi can access them and conversely Kenyan buyers
can easily access products from Rwanda, Burundi or DRC. Overtime, the range of
products traded at Mutukula Regional Market will increase alongside the volumes.
3.3.2 Leasing and Booking of Wholesale Shops

26
Each wholesale shop (15 x 20 Ft) will be leased for 25 years at UGX 44,000,000 in total.
The booking of the wholesale shop can be done as urgently as possible at UGX 200,000.
This fee will be paid in 5 years after which the renter will continue collecting fees from
sub-renters for the next 20 years up to the end of the 25 year lease period. The renter
will continue paying for utilities like water, electricity and other utility bills, ground
rent and management fees. The renter of the wholesale shop will get connections to sub-
renters and the entire business world guaranteeing them to landlords. The renters will
be linked to financial institutions to enable them access credit. Mutukula Regional
Market will guarantee traders and manufacturers who may wish to secure loans or
credit from banks like Centenary Bank, Standard Chartered Bank, Equity Bank, Absa
Bank and the Uganda Development Bank. The renter who will want to sell off his or
her goods will be allowed to do so. This will be administered by the renter (seller),
purchaser and the administration of the market.
3.3.3 Leasing and Booking of Stalls
The stall will be leased for 25 years at UGX 15,000,000. The booking of the stalls can be
done as urgent as possible at UGX 200,000 each. This fee shall also be paid in 5 years
after which the renter will continue collecting fees from sub-renters for more 20 years
until the end of 25 years. The renter will continue paying for utilities like water,
electricity and other bills, ground rent and management fees. The renters of the stalls
will get connections to sub renters and the whole business world guaranteeing them to
become landlords. The renters will be connected to financial institutions for credit
access. Mutukula Regional Market will guarantee traders and manufacturers who may
want to acquire loans or capital from banks like Centenary Bank, Standard Chartered
Bank, Equity Bank, Absa Bank and the Uganda Development Bank. The renter who

27
will want his or her good will be allowed to do so. This will be administered by the
renter (seller), purchaser and the administration of the market.
3.3.4 Leasing and Booking of the Parking Yard
The Parking yard (on 10 acres) will be leased for 25 years at UGX 30,000,000 per month
in total. The booking of the parking yard can be done as urgent as possible at UGX
200,000. This lease fee shall be paid in 5 years after which the renter will continue
collecting fees from sub renters for more 20 years until the end of 25 years. The leaser of
renter will continue paying for utilities like water, electricity and other bills, ground
rent and management fees. The renter of the parking yard will get connections to sub
renters and the whole business world guaranteeing them to become landlords. The
renters will be connected to financial institutions credit access. Mutukula Regional
Market will guarantee leasers who may want to acquire loans or capital from banks like

28
Centenary Bank, Standard Chartered Bank, Equity Bank, Absa Bank and the Uganda
Development Bank. The leaser/lessor who will want to sell off his or her good will be
allowed to do so. This will be administered by the leaser/lessor (seller), purchaser and
the administration of the market.
3.3.5 More Trade, Industry and Investment Opportunities at MRML
Mutukula Regional Market has and will create more opportunities in form of; the
Open Market, Fruit Market, Fuel Stations, Service Bay, Single Lane and Double Lane
shops, Banks, Carpentry Workshops, Welding Workshops, Dormitories/Dorm Space,
Supermarkets, Forex Bureaus, Restaurants, Accommodation Lodges, Outdoor
Restaurants, Sewerage Plant, Mechanical Workshop & Spare Parts, Washing Bay,
Shopping Malls, Hardware Shops, Cold rooms, Cooking Oil Honey & Butter, Solar
Plant, Water Plant, Power Plant, Silos, Animal Abattoir, Hotel Complex, Night Lounges,
Day Care Centre, Kids Park & Swimming Pool, Health Centre, Car Bond,
Demonstration Farm, Exhibition Farm, Sports Ground, Airstrip, among others. If we
work together (cooperate), we can develop by building the business centre which will
enhance tourism, market base and all other activities related to trade, industry and
investment in the region.
The Ugandans will be landlords of the leases by the virtual of the fact that they are
residents in terms of land acquisition and ownership in Uganda. They will therefore
acquire leases directly from the administration of Mutukula Regional Market.
Similarly, the non-residents

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Figure 5: Proposed Administration Block
Figure 6: Proposed Rutepi 5-Star Hotel [Aerial View]

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4.0 MARKET ANALYSIS
4.1 Market Trends
4.1.1 General Trends
The Government of Uganda has continued to provide a conducive environment for

investors in Uganda. Its commitment in this area has been deeply enshrined in its
Vision 2040. This vision, “A transformed Ugandan society from a peasant to a modern and
prosperous country within 30 years” aims at transforming Uganda into an Upper Middle
Income country within the next 30 years with per capita income of about USD 9,500.
Over this period, average real GDP growth rate is targeted to be over 8.2 per cent per
annum translating into total GDP of about US$580.5 billion with a projected population
of 61.3 million. This will match the level of development observed in upper middle
income (UMI) countries such as Malaysia, Mauritius, Hungary and Chile. The strategies
for this vision are:
► Invest directly in strategic areas to stimulate the economy and facilitate private
sector growth.
► Pursue an urbanization policy that will bring about better urban systems that
enhance productivity, liveability and sustainability.
► Pursue policies aimed at leapfrogging in the areas of innovation, technology and

science, engineering, human resource development, public sector management,
and private sector development.
► Develop and implement a National Innovation System that will help in initiating,
importing, modifying and diffusing new technologies.
► Front-load investments in infrastructure targeting areas of maximal opportunities

with focus on oil, energy, transport and ICT.
► Develop and nurture a national value system by actualizing a national service

programme to change mind sets and promote patriotism and national identity.
The development of Mutukula Regional Market (MRM) is relevant to this vision,

and the above mentioned strategies make the environment conducive for this
development in order to improve the welfare of the vendors and contribute to the
31
economic development of Uganda.
4.1.2 Urban Development
The estimated population of Uganda as of April 2021 is 42.484 million people, 24.36%
of these living in the urban areas1. Between 1980 and 2019 Uganda‟s urban population
has increased by a factor of 11.50 times 2 .However, the current urban population
growth rate is estimated at 5.995%3.
That said, at 13 per cent level of urbanization, Uganda is considered a rural economy
when compared to Kenya and Tanzania that are 20 per cent and 22 per cent urbanized
respectively. For the country to achieve faster socio-economic transformation there is
need to raise the level of urbanization. The level of urbanization is still very low in
most of the regions in Uganda ranging between 7 per cent and 10 per cent. Kampala
city is 100 per cent urban with a population of over 3.2 million and is the largest urban
centre, followed by Mbarara City with a population of 0.26 million3.
Mutukula town has experienced rapid population growth of over 5.61%per annum ever
since it was converted into a one-stop-border-post (OSBP) allowing the merging of
trade flows on both sides of the border. It is expected that the rapid growth of
Mutukula town‟s population will also occur concomitantly with changes in the
population structure of the town, which will also largely influence rural-urban
migration patterns in south-western Uganda and north-western Tanzania. Population
increase in Mutukula town will also be responsible for increased demand for
employment, land for housing, social services and infrastructure that will in turn
stimulate spatial urban development and industrialization.
From the above rural-urban development, it can be concluded that there is an

increasing number of both middle and upper class potential clientele for proposed
Mutukula Regional Market (MRM) commercial complex.
4.1.3 Challenges in the Real Estate Sub-Sector
The real estate subsector under which the Mutukula Regional Market (MRM) project
falls is faced with the challenges as listed in the table below. The strategies of
government to address the challenges have also been included in the table.
1 Uganda Bureau of Statistics, 2020 Statistical Abstract

2 World Bank data 2021
3 World bank data 2021

32
Challenges Strategies
Weak, outdated and uncoordinated legal and policy Developing a comprehensive national policy, law
framework presents critical challenges to the sector and investment plan.
Lack of access to and the high cost of finance Developing Information, Education and
constrain the sector. The requirements for communication strategy to sensitize the public.
accessing long-term mortgage finance are so
stringent, and therefore, unaffordable by a large Promoting rural housing development schemes.
section of potential borrowers.
Increasing access and availability of long term
High mortgage rates (currently above 15 per cent). affordable housing plan.
The introduction of tight credit standards by
commercial banks to mitigate default have made Providing technical support to public and private
borrowing unattractive and further limited the growth sector on housing.
in the sector.
Providing technical support to earthquake and other
High cost of building materials (cement, steel, disaster-prone areas.
timber, iron sheets) limits the sector’s growth. The
cost comparison for a 50 Kg bag of cement is A number of universities are offering a number of
approx. USD 7.74 in Uganda and USD 4 in the courses relating to real estate sector and number of
Middle East. The situation is worsened by the students being enrolled country-wide has increased.
country’s failure to adopt a range of low-cost
technologies in the construction sector. Investors are given incentives and waiver on
development projects.
4.1.4 SWOT Summary
The table below shows some of the strengths, weaknesses, opportunities and threats
identified in the development of regional logistics hubs like the one being proposed by
MRML.
Strengths Weaknesses
Favourable location: The proposed MRML Competitors can offer similar logistical hub services
Complex is favourably located at Mutukula which is quickly.
now a Customs One Stop Border Point (OSBP)
and also on a major trade highway linking Uganda High project investment costs: The project
and Tanzania with strong future trade growth investment capital cost requirement is high and
prospects within the next 5-10 years. sourcing capital financing for MRML might take some
time which could affect the planned project
Easy access: The site location of MRML implementation schedule.
Complexat Mutukula Town is quite strategic as it is
33
situated right on an international trade route linking Comparatively lower use of the Dar-es-Salaam to
Uganda to Tanzania and possesses high potential Kampala trade route (Southern Transport Corridor)
for growth into a busy international business hub and high logistics cost in comparison to the traditional
with the foreseeable integration of the EAC Mombasa to Kampala route (Northern Transport
countries into a single political federation. Corridor).
Immature logistics market: There have emerged

immature third party freight logistics enterprises in
the Uganda logistics services market with many
disadvantages such as narrow range of logistics
services, low level of IT, too many small-scaled
enterprises, high cost, poor facilities and equipment
and so on.
Opportunities Threats
The general trend of national development that has Time constraint: This constraint exists given the
seen a number of commercial real estate urgent need of the development versus its
developments come up in the past few years magnitude.
changing the skyline of Uganda’s urban areas.
Spill-over effects of the global economic crisis
Apparent political stability that has characterized the leading to less aggregate demand, recessional
country over the past two decades has provided a tendencies and affecting the running of business.
secure environment to transact and carry on
business. The unstable foreign exchange rates. Political
interference in the market development.
Government support: The project has got the
support of the GoU, through the Office of the Disagreements amongst vendors and traders.
President and government policy on markets.
Increasing urban population.
4.1.5 Strategy to Overcome Weaknesses and Threats
The following strategies have developed to address the weakness and threats facing the project:
Weaknesses Efforts to address weaknesses

Competitors can offer similar logistical hub services MRML should be able to use its first mover
quickly. advantage in the regional logistics hub and trade
market sector to heavily publicize and successfully
market its services ahead of the competition.
High project investment costs: The project MRML should be able to source project funding
investment capital cost requirement is high and from external equity investors or venture capitalists

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sourcing capital financing could take some time. with the cash liquidity and relevant market
experience.
Lower utilization of the Dar-es-Salaam to Kampala The volume of freight and logistics movement on
route (Southern Transport Corridor) the Southern Transport Corridor will be able to
grow in response to construction and operation of
the planned East African Oil Pipeline [EACOP]
within the next 5-10 years.
Immature logistics market. MRML can easily overcome this market weakness
by offering smart and superior logistics hub
solutions that integrate the provision of modern
facilities for clients with top-notch physical
infrastructure, quality services offered, and
operating an efficient logistics hub with a strong ICT
infrastructure to back it up.
Threats Efforts to address the threats
Time constraint: This constraint exists given the Engaging professional advisors to advise and give
urgent need of the development versus its needed insights on the project progress.
magnitude.
The unstable foreign exchange rates. Bank of Uganda intervention on depreciation of the
Shilling.
Upcoming logistics hubs and free trade zones. To promote its campaign of being the first
comprehensively equipped and facilitated inland
regional market and logistics hub within the EAC
region.
4.2 Market Plan and Strategy
The main purpose of the marketing plan is to attract, retain and serve the customers of
MRML. The marketing plan will be developed and launched by MRML management
after completion of the project. The plan will enable MRML to adopt a consistent
approach in carrying out the following:
► Attracting customers to Mutukula Regional Market (MRM).
► Retaining the customers.

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► Designing and implementing a customer care programme which will ensure
quality service to customers.
The aim of the plan is to ensure Mutukula Regional Market (MRM) is well known in
Uganda and beyond, all available space is taken by the vendors, traders, tenants and
customers are attracted to MRM and that it offers quality goods and services. The plan
will address the competitive market position the complex is faced with and will also
explain how the plan will be implemented on a day-to-day basis.
Mutukula Regional Market (MRM) is expected to attract all types of customers

including foreign visitors to Uganda. Special marketing booklets will be produced and
distributed to the public. Radio and TV awareness programmes will be launched.
4.2.1 Market Segmentation
Mutukula Regional Market (MRM) complex will offer space to a variety of tenants
and sub-leasing businesses and the remaining space will be available for rental to any
customers who fit in the programme. The complex is expected to attract the following
type of customers:
Warehouse Operators
The Mutukula Regional Market (MRM) complex will function as a logistics

hub within which different logistics service providers and the 1,000 warehouse
operators will collaborate in order to offer value-added services by keeping goods
together in one place, consolidating orders, mixing products and allowing access to the
premises at any one given time. Each warehouse will have a goods storage and
consolidation space of 325 square metres in area size.
Retail and Wholesale Shops
Retail and wholesale shop operators will be allocated retail or wholesale shops or space
according to their choice. Each retail/wholesale shop (15 x 20 Ft) will be leased for 25
years at UGX 44,000,000 in total. The booking of the wholesale shop can be done as
urgently as possible at UGX 200,000. The retailers and wholesalers will operate fixed
point-of-sale locations within the MRML complex, located and designed to attract a
high volume of walk-in customers. Any other customers are expected to be attracted to
the complex because of the existing vendors and traders in the complex.

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Market Stalls
Market stalls will be set up as permanent units with the MRML complex. The market
stall operators will rely on visual merchandising and point-of-sales displays to attract
and retain potential customers to their business. Each market stall will be leased for 25
years at UGX 15,000,000. The booking of the stalls can be done as urgent as possible at
UGX 200,000 each. MRML expects to have market stall operators being its highest
number of tenants on account of the fact that they are the least cost business units to
operate and maintain.
Trucks Parking Space
Mutukula Regional Market complex will have a sizeable truck parking 10-Acre space
for accommodation of heavy, medium and light-sized vehicles while in transit through
the Mutukula border cross point (BCP). The purpose of the trucks parking area is to
create a Safe and Secure Trucking Parking Area (SSTPA) where drivers, transport
companies, forwarders, shippers and insurers, and the society as a whole will benefit
from the MRM truck parking space facilities via the protection of drivers, cargo and
transport equipment. The Parking yard (on 10 acres) will be leased for 25 years at UGX
30,000,000 per month in total. The booking of the parking yard can be done as urgent as
possible at UGX 200,000.
Financial Institutions
Mutukula Regional Market complex will generate a lot of cash because of the nature of
businesses operating in the complex. This cash is expected to attract a number of
financial institutions to the complex. The existence of commercial banks in the complex
will also be of benefit to the shoppers as they will be able to do their banking while in
the complex. Other financial institutions will include insurance companies and
insurance brokers,
Business community:
Mutukula Regional Market complex will provide a good business outlet for all types
of goods and services and the various traders and service providers are expected to set
up in the complex. Space will therefore be available for the following type of businesses;

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► Open-air market
► Fuel station and auto-service garages
► Car washing bays
► Spare parts retail shops
► Carpentry workshops
► Welding workshops
► Supermarkets
► Forex Bureaus
► Shopping Malls
► Hardware Shops
► Cold Rooms for perishables
► Grain Silos
► Solar Power Plant
► Electricity Sub-Station
► Water Treatment Plant
► Livestock Abattoir
► Medical Clinics & Health Centres
► 5-Star Hotels &Restaurants
► Night Lounges
► Dormitories/Dorm Space

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► Saloons
► Day Care Centre
► Kids Amusement Park & Swimming Pool
► Recreation and Sports Ground
► Agricultural Demo Farm & Exhibition Farm
► The Clothing shops
► Office Space
► Training Centres
► Car Bonds
► Airstrip
Multinational Companies and NGOs
The other class of clientele will be the Multi National Companies (MNCs) and NGOs in
Uganda. Most of the NGOs deal with vulnerable groups majority of which are found
up-country and busy cross-border locations. In order to easily access the vulnerable
groups, a number of NGOs are expected to acquire space, Mutukula Regional Marke
tcomplex presents an opportunity for this category as well.
4.2.2 Mutukula Regional Market Limited’s Value Proposition
Mutukula Regional Market complex‟s value proposition will be delivering seamless

and consistent quality service to low, middle and high income earners. This complex
will emphasize mainly on the following:
► Convenience and comfort of the traders by putting in place and maintaining the
desired facilities for the benefit of customers;
► Adequate parking space for heavy, medium and light commercial vehicles.

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► Maximum security to customers and commodities.
► One stop centre for most of the goods and services
► Quality customer care services
► Recycling plant for garbage
It will offer a cross section of goods and services in order to satisfy customer needs.
These value propositions will always be communicated through advertisements,
customer care, sales literature and catalogues.
4.2.3 Pricing Strategy
Appropriate prices will be agreed upon with the vendors and traders taking into
consideration Mutukula Regional Market complex‟s standards and comparable prices
in the market especially the malls down town. It is important to note that, Mutukula
Regional Market complex‟s rental space and facilities will be superior to many of the
other border markets within the EAC region.
The price indication in the table below is estimated by the sponsors based on the
available information on the market and the competitor analysis. From the current
trend of rental space down town the price indication is estimated as follows;
Table 4: Pricing Strategy

Space USD/Month
Warehouses 4,600
Market Shades 8,920
Rates per sq. Shops 200
Vehicle Commercial Parking Space 38,000
4.3 Revenue Analysis Estimated from the Project
The Project is expected to generate revenue from the following sources:
► Rental fees from warehouse operators;
► Rentals from retail/wholesale shop operators;

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► Rental fees from market shades operators;
► Ground rental fees by 5-star hotel operators, lodge-owners, commercial building

owners, and children parks operators;
► Regional market operator ground rental fees on plant equipment operators

including; grain silos and drying plants, electricity transmission and distribution
sub-stations, water reticulation plants and sewerage systems and petrol stations;
► Ground rental fees payable by operators of the day care centre, livestock market &
abattoir and regional market toilets
► Commercial Yard Parking fees; and
► Advertising space
4.3.1 Market Levy Fees/Service Charges
All tenants shall pay levy fees and Service Charge (for other tenants) meant to assist in
the day-to-day operating of the mall. The table summarized the assumptions for
estimating the market levies:
Table 5: Market Levy Fees

Category Rate per Month (US$/Sq. metre) Annual Increment (%)
Shops 5.56 5%
Stalls 5.00 5%
Source: MRML Management
The management assumes that 6% of lettable area is open space while the remaining
94% shall be in a closed area and assumes that the Mutukula Regional Market shall
operate an average of360 days per year.
4.3.2 Small Vehicle Parking Space Revenue Assumptions
The sponsors have also assumed revenues from the hiring out of parking space for
smaller vehicles.
Mutukula Regional Market (MRM) management has made the following assumptions;

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► 390 parking slots will be available for rent by members, tenants and customers.
► It is expected MRML shall charge parking fees for an average of seven days a
week, making an average of 360 days a year.
► Average utilization of the parking space is assumed to be 40% in the 1st year and
will increase by 20% in Year 3 and subsequently by 10% per year.
► MRML will charge US$0.5 per parking slot per hour. This shall be increased at 5%
per annum up to a maximum of US$2 per hour/parking slot.
4.3.3 Advertising Space Revenue Assumptions
The management of MRML assumes that the company will earn revenue from
advertising space within the mall. The following assumptions have been used;
► 1500 square meters of advertising space will be available for rent within the entire
building.
► An annual rate of US$ 1,000 per square meter will be charged for the advertising
space increasing by 5% per year.
► It is also assumed the average utilization of the advertising space per year shall be
20% in Year 1 increasing by 10% per year up to 90% in Year 8. The utilization will
be expected to remain at an average of 90% for the remaining period of the
projections.

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5.0 LEGAL AND REGULATORY REVIEW
5.1 Legal Form
Mutukula Regional Market Limited (MRML) is a private company limited by shares.

It was incorporated under the Uganda Companies Act Cap 110 on the 24th April 2018
as a limited liability company. Its registered office is situated in the Republic of
Uganda. The Uganda Registration Services Bureau (URSB) Registration Number of
Mutukula Regional Market Limited (MRML) is 80020000865783 and it‟s Uganda
Revenue Authority (URA) TIN No. is 1013104332. The company‟s authorized share
capital is UGX 2,000,000 made up of 100 Ordinary Shares of UGX 20,000 each. The
company has 5 shareholders and 5 directors.
Salt Plus Limited comes into the proposed Mutukula Regional Market Limited
(MRML) project with an equity capital base (invested and planned) of US$21,924,000.
The Company has 2 principal shareholders with share ownership as follows:
Table 6: The Company Shareholders

Shareholder Shares held (%age)
1. Mr. Kalamagi Kalim 90 90.00%
2. Ms. Rose Namujuzi 10 10.00%
Total 100 100.00%
5.2 Licenses, Approvals and Consents Required
In the process of implementing the project, MRML should obtain the necessary
approvals from the various regulatory and facilitating authorities. MRML will require
the following licences, approvals, and consents before the project is commissioned.

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Table 7: Required Licenses, Approvals and Consents
Stage Requirements Status
Company registration with the Registration of the company deeds and Completed
Uganda Registration Services articles of association
Bureau (URSB)
Registration with Uganda Application for registration with UIA Completed
Investment Authority (UIA)
Membership with National Registration of the Company for membership Completed
Organization of Trade Unions with Uganda Markets and Allied Employees
(NOTU) Union
Membership with UNCCI Application for membership In progress
Registration with Uganda Application for tax registration (to obtain Tax Complete
Revenue Authority (URA) Identification Number, TIN) and VAT
registration
Registration with National Social Application for registration with the Social To be done
Security Fund (NSSF) Security Fund
Building Permit Application for location permits and building To be done
permit
Company Seal Making a company seal Completed
Trading License Application for trading license Completed
Environmental Impact Performing an EIA In progress
Assessment (EIA)
Registering the property Registration with the land registry. To be done

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6.0 MARKET OPERATIONS, DESIGN & CONSTRUCTION
6.1 Market Design and Construction
6.1.1 Stages in Design
The Mutukula Regional Market (MRM) development project will go through a

number of distinct stages and these are summarized in Figure 7. The critical stages are
stages 1 to 5, from the initial brief through to testing the feasibility of the proposals.
These five stages (sometimes called “project preparation”) will determine the final
direction the project ought to be taking and confirm the decision to proceed with its
implementation.
6.1.2 The Design Process
The process starts (Step 1) with the identification of the marketing problem and needs
of the users, particularly women who are the main users of the markets, leading to
broad recommendations on how this problem might be solved.
Physical as well as socio-economic surveys will be required at this point (Step 2) to

allow design to proceed. An assessment will need to be made of the performance of the
existing markets in the selected local authorities. This will be undertaken in
consultation with the urban authorities and the market users (producers, traders, etc.).
Data already collected through the field surveys, together with desk studies of existing
information (such as published maps) need to be brought together and analyzed.
Special surveys may need to be undertaken at this time, for example, surveys for
targeting women and/or vulnerable groups or specialized surveys to supplement an
environmental impact assessment.
The next step (Step 3) is to identify with the users or community the various planning
and infrastructure alternatives that are available to solve the identified planning
problem and to priorities these options. Essentially, at this point in the process, it
should be clear what the community wants and what is appropriate for the situation in
terms of space and facilities.

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Figure 7: Market Design and Development Process
Outline proposals are then drawn up (Step 4), sometimes requiring a range of different
options to be looked at. Some initial ranking of the options may be made. Sometimes at
this stage it is necessary to look again at the design brief and make modifications - the
design may need to solve a completely different set of problems to that which was
originally anticipated when the designs were discussed with the users.
The next step in project preparation (Step 5) is where the market improvements are
designed in some detail and budget cost estimates are prepared. A financial analysis
may need to be undertaken at this point to confirm the feasibility of proposals for larger
markets – to confirm that revenues are going to be sufficient to cover operating costs. A
saving of 2–3 % of the total quantity (or value) of produce marketed is usually
considered a realistic assumption.
Before proceeding with the detailed design drawings, specification and a simple
schedule of quantities (Step 6) the proposal needs to be agreed with the financier of the
project through a process of negotiation and approval. Design adjustments may be
needed to meet cost limits.
This is followed by the preparation of tender documents, the tendering process and the
letting of contracts (Step 7). The project is then implemented (Step 8), through the
provision of construction services.
Finally the project is monitored by the users and evaluated (Step 10) to ensure that
what has been implemented conforms to the original project design and that any

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lessons learned from the experience can be applied to any further projects. The
monitoring process is discussed in the next section.
6.2 Layout and Circulation
Market operations are influenced by management methods and by the physical lay-out.
They need to achieve:
 an unobstructed traffic circulation pattern and effective parking control with
adequate parking facilities being provided;
 maximum possibility for interaction between the market users leading to the
possibility of optimum price formation;
 provision and full utilization of support facilities;
 adequate arrangements for display and sale of produce to maintain produce
quality; and
 efficient produce handling (such as by pallets and forklifts).
The main factors which shall be taken into account when designing the new Mutukula
Regional Market (MRM) will therefore be as follows:
 adequate space provision is essential, for sales areas, storage, administration,
specialized facilities, circulation and, especially, parking;
 ideally, this space provision should allow both for future expansion needs and
for adjusting the space utilization of the market to match management
requirements to meet changing social and economic circumstances;
 building designs should also allow the maximum amount of flexibility for
change; and
 there are clear advantages for maximizing market efficiency and for reducing
congestion by the adoption of an organized approach to traffic control and by
using controlled parking. This is usually achieved by segregating pedestrian and
hand-cart movement from heavy delivery vehicles.
6.3 Access
The Mutukula Regional Market (MRM) will be accessed through four entrances which
will be maintained in the Implementation Plan/Schedule.

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6.4 Storage
There will be a cold storage area that the Mutukula Regional Market (MRM) tenants
can directly access from the main market area, merchandise stores and a cottage
industry.
6.5 Delivery and Loading
The MRML warehouse operators, retail/wholesale shop and market stall operators will
require ample controlled, short-term truck loading and off-loading along the length of
the main Mutukula highway curb where they can easily load or off-load their
merchandise especially during the peak hours of business. The MRML Project
Management Team will also explore the options of drop-off along the main Mutukula
highway during the off-peak hours, in consultation with Mutukula Town Council.
6.6 Restrooms
The building Mutukula Regional Market complex will have adequately-sized and
suitably-configured Public and Staff restrooms.
6.7 Exterior Façade
We envision making extensive exterior façade improvements on the new Mutukula

Regional Market (MRM) so that they make a remarkable visual impact on the road or
street where it will be located so that it becomes an attractive landmark feature in the
Mutukula border cross point area to increase patronage and customer flows to the
market. The exterior façade will therefore be designed to make it the biggest draw
feature of the market.
6.8 Signage
To generate awareness of the Mutukula Regional Market (MRM), we recommend the

installation of three significant and strategically placed Mutukula Regional Market
(MRM) building-top signs. The design and content of the interior signage will be
established in consultation with the Mutukula Town Council and Ministry of Works
and Transport.

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6.9 Utilities
It is assumed that primary MEP/FP (Mechanical, Electrical, Plumbing and Fire

Protection) systems will originate in the sub-grade mechanical rooms of the garage, or
the top floor mechanical penthouse above the garage. The concept for the market is to
incorporate a series of vertical utility columns, architecturally enclosed to feed water
and power to each vendor stall zone. Water distribution to vendor sinks could also be
from above and down the columns, but waste water removal poses a challenge due to
the slab separation to the adjacent vent buildings. To solve these challenges, a uniform
raised floor (12”) of a new concrete slab cast over foam blocks is proposed to facilitate
local drains from sinks and grinder pumps to push waste up and over to main drops
into the pump room.
Toilet plumbing floor chases will be designed into the building and will be used to the
fullest extent.
A main electric room of 15 square feet to 200 square feet will be needed within the
market, with conduit distribution across the ceiling above, to avoid floor outlets. The
fire alarm system will be zoned into the office building system at the common fire
command center in the office lobby. The will also be a central control room for CCTV
security cameras.
The market fire protection system is assumed to be zoned into the market building
complex as a new system with fire pumps, unless supplemental capacity is needed.
6.10 Ventilation and Food Preparation
Although our operational plans do not include a conventional sit-down restaurant, a

full HVAC system will be required to condition the space, provide fresh air, and
exhaust sufficient to meet not only the building code, but to favour a high air-change
rate to properly manage food market odors. It is assumed that a mechanical penthouse
on the top of the market building complex will be available for main packaged air
handlers. A riser route to the market will have to be established to connect to a market
ceiling duct network rationalized for the market layout with fixed primary and flexible
secondary branching (to accommodate vendor changes). The Demonstration Kitchen
will require an exhaust system with grease scrubbers that can be easily accommodated.

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6.11 Floors and Ceilings
As described above, a raised floor is envisioned to facilitate utilities and also to create
an even floor level, accessed by gentle 5% grade ramps near the entries. The even floor
level will be best for circulation and movement of produce and goods. A washable
surface of either polished concrete or granite tile would be appropriate. Electric outlets
in the floor will be avoided to permit safe wash-down and maintenance. The ceiling
finish is envisioned as an open architectural grid, sufficient to screen MEP systems, but
flexible to accommodate stall, signage and lighting arrangements. A solid surface
ceiling clouds option at selective vendor groupings will work with the grid.
6.12 Open Air Market
(a) Stalls/Shops
We have two types of Vendor stalls/shops; Permanent year-round interior stalls/shops

for agricultural and other perishable products and exterior-based shops/stalls for
industrial and other non-perishable goods. Each permanent year-round interior stall
will be provided with a minimum of a hand sink, separately metered electricity, and
floor drainage. The heating, ventilation, and air conditioning will be provided by the
lease-holder and charges will be pro-rated back to the vendors. For design aesthetics,
the Mutukula Regional Market (MRM) will collaborate with its architectural team to
establish design guidelines for each vendor type.
(b)Butchers, Fish Stalls, Poultry and Eggs Stalls and Dairy Products
Meat, dairy and fish stalls

Although fresh fruits and vegetables may make up the majority of the food-related
stalls, facilities for dairy product dealers, butchers and fishmongers will also be quite
important in the Mutukula Regional Market (MRM). Butchers and fishmongers will
have their own separate section with the advantage that hygiene standards and
cleaning routines can vary from that prevailing in other parts of the regional market
complex. This section will also have its own cool stores (refrigeration section) as
maintaining low temperatures in order to maintain dairy, meat and fish product
freshness is of paramount importance in livestock product sales in a public market
environment operating in hot and humid tropical climatic conditions.
Larger traders in dairy products, meat or fish also require a separate section within the
Mutukula Regional Market (MRM) with provision for adequate ventilation and of
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facilities for effectively washing down the stall area at the end of each day of business
activity. It is equally important from a health point of view that facilities for butchers
and fishmongers are concentrated in one location within the Mutukula Regional
Market (MRM) (ideally away from the movement of animals and vehicles). Such a
location shall also have a provision of fly-proof meat safes and hanging rails for meat.
The section will also have separate sub-sections for butchers, meat slaughter, fish sales,
fish-gutting and dairy product sales.
Poultry and egg marketing

The poultry section of the Mutukula Regional Market (MRM) including areas/stalls
for the sale of chickens and poultry products, will as a matter of necessity have their
own unique design requirements. The main distinction will be whether the poultry is
sold live or already slaughtered. In the latter case, the sales facility will not be visibly
much different from that used for fresh meat or fish, except that using hanging rails for
display of the dressed birds will be preferred. For live birds, which have the distinct
advantage over pre-killed birds in that they do not have to be disposed of by the end of
the working day, there are two basic modes of sale. Firstly, the poultry can be bought
live (i.e. for slaughter at home) or it can be slaughtered and plucked (de-feathered) in
the market on demand, in which case special slaughter facilities will need to provided,
This usually requires a shackle for hanging the birds and hot water for scalding
carcasses. Also to be included in the regional market complex will be a slaughter slab
oriented to Mecca to cater for Muslim customers; halaal beef needs.
6.13 Physical Security
Design guidelines will include two to three different security options for the permanent
interior tenants and vendors to choose from (i.e., vertical or horizontally drawn security
grilles). The security for the public entries will be reviewed on an individual basis.
Additionally, per our Operations Plan, the Mutukula Regional Market complex will be
staffed with five full-time security agents.
The Mutukula Regional Market complex will also provide space for a police post at a
convenient location within the complex.
6.14 Other Building Uses
As per the design layout, we have suggested where the office escalators could be
installed to allow departure to the upper floor and arrival down from at a point directly
associated with the office lobby. We observe that the escalators are best placed on either
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the east or west sides of the north stacks for overall accommodation of both the market
and the offices, without interference with the existing drainage trough or the fire-stairs.
This suggestion is subject to the office program and circulation.
Space will also be allotted for the positioning of important facilities and amenities
within the market complex including a conference hall, a health center (domiciliary),
and the main administration office where the MRML executive and other market
administration officers will sit to conduct routine market oversight and operations.

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7.0 START-UP OPERATION REQUIREMENTS AND PROCEDURES
The MRML’s project management team will have a long list of duties to accomplish
before the complex opens, including hiring the MRM Complex Manager one year out
and adding staff as needed up until opening day.
7.1 Pre-Opening Requirements
1. Formation of MRML6-man advisory committee

 Establish mission, guidelines and oversight
2. MRML advisory committee issues guidelines for complex development,
operation and oversight
3. Project Management Team hires manager
 Up to one year before opening
 Begin stall/shop sales and outreach
 Coordinate operations
 Set up office
 Set up systems
 Hire staff
 Open the MRM Complex for business
4. MRML advisory committee and Project Management Team establish
development team
 Point persons for development phase
 Design/Architecture/Engineering
 Financial coordination
 Tenant coordination
 Construction management
 Permitting
 Role of manager/operator
5. Project Management Team establishes policies and documents, approved by
oversight committee
 Rules and Regulations
 Lease applications
 Tenant leases
 Tenant Design Criteria
 Tenant allowance
 Establish hours of operation

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6. Establish relationships
 Mutukula Town Council
 Ministry of Local Government
 Other Governmental MDAs (Ministries, Departments, and Agencies)
 NGOs
7.2 Proposed Operating Requirements
1. Tenants
 Shops/Stalls acquisition down-payments
 Billing on balance of shops-stalls acquisition fee
 Relations
 Enforcements and inspections
2. Facilities
 Maintenance systems
3. Financials
 Accounting systems
 Reports to Project Management Team‟s Board of Directors and the MRML‟s 6-
man advisory committee
 Goal setting
 Long range capital planning
 Capital funds sourcing
4. Communications
 Customer relations
 Media relations
 Events, promotions and advertising
 Education
 Outreach to partners
5. Staff
 Hire
 Train
 Manage
6. Reports
 Project Management Team‟s board of directors
 MRML advisory committee

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8.0 ENVISAGED INSTITUTIONAL AND OPERATING ARRANGEMENTS
8.1 Running of the Company, Roles and Responsibilities
The management structure will be spearheaded by a Board of Directors who will

delegate their authority for the day to day activities to an operation team led by a Chief
Executive Officer (CEO). The CEO will supervise the General Manager will also
supervise the Operations Manager, Production Manager, Procurement Manager,
Internal Audit Manager, Finance & Administration Manager, and Human Resource
Manager. The Managers will have departments that be staffed with Assistants and
other Officer depending on need and strategic analysis of the market operations.
The General Manager will also oversee representatives from the East African Countries
including; Kenya, Tanzania, Uganda, DRC, Rwanda, Burundi and South Sudan. The
institution will employ qualified and experienced individuals as described in the
established recruitment policy.
In order to achieve our objective as a regional market bringing together entrepreneurs

and cross border from the region, management of the market will work with a Multi-
sectoral team adopted from all the Ministries, Department and Agencies (MDAs) of
Government which interface with cross border business in their day to day operations
such as: Uganda Revenue Authority (URA); Ministry of Trade, Industry and
Cooperatives (MTIC); Ministry of Agriculture, Animal Industry and Fisheries
(MAAIF); Directorate of Immigration and Citizenships (DIC); Uganda National
Bureau of Standards (UNBS); National Drug Authority (NDA) and the Uganda Police
Force (UPF).
Below is the Proposed Structure for Mutukula Regional Market Limited (MRML).

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Figure 8: MRML Organizational Structure
Shareholders
Committee to the Board of

Board Directors
Chief Exexutive
Officer (CEO)
General
Manager
Finance & Procurement Internal Production Human Resource

Operations Manager
Administartion Manager Audit Manager
Manager Manager
Manager
Department
Loaders
8.1.1 Shareholders
The ultimate owners of MRML are the shareholders who elect members of the Board of
Directors to represent them in managing the company. At registration the company
had 2 shareholders each subscribing 18,000 shares and 10,000 shares respectively. The
shareholders are responsible for the following:
► Appointment of directors
► Appointment of auditors and fixing their remuneration
► Approval of the audited financial statements and
► Any other matters as determined by the Companies Act to be approved by the

shareholders
8.1.2 MRML Board of Directors
The Board of Directors will be the highest governing authority within the
management structure of MRML. The primary responsibility of the Board of
Directors will be to develop policies for the proper management of the company. The
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board will be expected to develop policies which will guide the management of
MRML in carrying out the following:
► Implementation of good corporate practices
► Constructing and maintaining the mall property in accordance with international

standards;
► Designing and implementing a management information system which will

produce update information for decision making;
► Mobilizing funding to enable MRML carry out its activities
► Preparing and maintaining adequate records of the company.
► The directors are also responsible for ongoing decision making in the business
and are directly accountable to shareholders. They provide a report to
shareholders on the performance of the company during the annual general
meetings. The roles and responsibilities of the Board of Directors are summarized
as follows:
► Establish vision, mission and values of MRML. They are to determine the
company‟s vision and mission to guide and set the pace for its current operations
and future development as well as determine the values to be promoted
throughout the company.
► The directors are charged to determine and review company goals and policies.
► Set strategy and structure. The BOD reviews and evaluates present and future
opportunities, threats and risks in the external environment and current and future
strengths, weaknesses and risks relating to MRML. The board is also charged with
determining strategic options, select those to be pursued, and decide the means to
implement and support them, as well as determining the business strategies and
plans that underpin the corporate strategy. The board also ensures that the
company's organizational structure and capability are appropriate for
implementing the chosen strategies.
► Provide oversight on the management of the company. .

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► Fiduciary responsibility.
► Delegate to management. The BOD delegates authority to management, and

monitor and evaluate the implementation of policies, strategies and business
plans, determines monitoring criteria to be used by the board, to ensure that
internal controls are effective. The board is further charged with facilitating
communication with senior management.
► Exercising accountability to shareholders and be responsible to relevant

stakeholders. The board ensures that communications both to and from
shareholders and relevant stakeholders are effective, as well as understand and
take into account the interests of shareholders and relevant stakeholders. The
directors look after the affairs of the company, and are in a position of trust, must
act with due skill and care and are obliged to consider the interests of employees
of the company
► The BOD also arranges and facilitates the Annual General Meeting and any extra
ordinary meetings of MRML.
8.1.3 Non-Executive Directors
MRML plans to have specially elected non executive directors on the board to
independently crosscheck decisions and deliberations of the executive members of the
board of directors and to offer unbiased outsider opinion in the running of the
company.
Qualification and skills of Board members
The overall ability and experience of individual Board members should determine
their suitability. The following attributes should be considered as desirable in the
Board of Directors:
► Must have extensive experience in business, real estate and/or public service
► Should hold an undergraduate degree from a respected college or university
► Should be of the highest moral and ethical character.
► Should have the personal qualities to be able to make a substantial active

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contribution to Board deliberations.
► Must be willing to commit, as well as have, sufficient time available to discharge

the duties of Board membership.
► Should be able to develop a good working relationship with other Board members
and contribute to the Board's working relationship with the senior management of
MRML.
8.1.4 Management
The board of directors will appoint a management company that will be led by a Chief
Executive Officer (CEO) or Managing Director (MD). The CEO working together with
the board shall appoint qualified management staff to fill the key positions as specified
in the management structure of MRML. MRML shall also engage professional advisors
to the company who will be available advice and guide the company on best
management practices.
8.1.5 Chief Executive Officer (CEO)
The CEO’s role is to develop and deliver on MRML’s strategic plan in the most
effective and efficient manner and is also accountable for the overall performance of
MRML and for the day-to-day running and management of the company‟s business.
The responsibilities of the Chief Executive Officer (CEO) will include;
► Implement the Board‟s policies and strategies
► Develop and present the strategic and annual business plans to the Board for
approval
► Report to the Board on progress against the strategic and annual business plans on
a regular basis.
► Manage the day-to-day operations of MRML.
► Manage, motivate, develop and lead members of the Management Team
► Manage resources efficiently and effectively to achieve the company‟s objectives

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Qualifications of the Chief Executive Officer:
The Chief Executive Officer (CEO) should have the following Qualifications;
► Strong managerial and leadership skills
► Graduate or post graduate in subjects related to business management, economics,

etc.
► 10 years of experience in senior managerial positions.
► Effective decision making and excellent communication skills.
8.1.6 General Manager (GM)
The General Manager (GM) will be tasked with overseeing daily business activities of
MRML, improving overall business functions, training heads of departments, managing
budgets, developing strategic plans, creating policies, and communicating business goals.
The key responsibilities of the General Manager (GM) will however include the following:
► Overseeing daily business operations.
► Developing and implementing growth strategies.
► Training low-level managers and staff.
► Creating and managing budgets.
► Improving revenue.
► Hiring employees.
► Evaluating performance and productivity.
► Analyzing accounting and financial data.
► Researching and identifying growth opportunities.
► Generating reports and giving presentations.

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Qualifications of the General Manager:
► Degree in Business Management or a Masters in Business Administration.
► Good knowledge of different business functions.
► Strong leadership qualities.
► Excellent communication skills.
► Highly organized.
► Strong work ethic.
► Good interpersonal skills.
► Meticulous attention to detail.
► Computer literate.
► Proactive nature.
8.1.7 Finance & Administration Manager
The Finance Manager‟s role is to plan, organize and direct MRML’s Finance and
Administration Department. This position is responsible for developing and
implementing financial and administrative procedures such as:
► Receiving rent and maintaining tenants records
► Maintaining payroll,
► Maintaining a reliable management information system,
► Dealing with all matters pertaining to the administration of MRML including

security, marketing, customer relationship management etc

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Qualifications of a Finance and Administration Manager
► Graduate in either economics or Finance, Management, Business
► Membership of a relevant professional accounting body
► Previous work experience in real estate.
► Good oral and written communication skills, self-motivation, commercial

awareness, initiative
► Excellent problem-solving, analytical, technical, IT and numerical abilities are

crucial.
8.1.8 Operations Manager
The Operations Manager (OM) would manage the local provision of facilities in the
complex and other properties for MRML and its premises. The role would involve
supervising staff, contractors and consultants to ensure the services provided meet the
needs of the vendors and tenants. The responsibilities of the Operations Manger will
include;
► Collaborating with relevant parties to create a budget.
► Overseeing money handling, accounting, and bank processes.
► Employing strategies to ensure the company‟s growth.
► Implementing plans to address stock losses and theft.
► Employing means to control company costs.
► Generating financial reports.
► Conducting performance reviews judiciously and motivating staff.
► Effecting better business practices.
► Maximizing operating potential to exceed customers’ expectations and company goals.

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► Managing marketing initiatives.
► Responding to and addressing maintenance issues.
► Registering tenants
► Participating in or initiating litigation with tenants, contractors and insurance

agencies.
► Manage and administrate operations of the complex
► Oversee major renovation, design and construction and land altering projects
► Oversee security requirements.
Qualification of the Operations Manager
► Graduate in business administration, finance, accounting, real estate and public

administration
► Experience in real estate with skills and knowledge in areas as maintenance of

mechanical systems, influencing property values, risk management, human
resources, real estate law, and tenant relations.
► 5+ years of experience successfully managing a complex enterprise's human

resources, finances, operations, or strategies.
► Proficient ability to manage complex budgets.
► Proficient ethical leadership abilities.
► Excellent communication skills, both written and verbal.
► Outstanding people skills.
► Ability to make projections three years into the future.

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8.1.9 Procurement Manager
The primary role of a Procurement Manager is to understand the current business

processes, policies, and contract law. The responsibilities of a procurement
manager may include;
► Identifying suppliers
► contracting , and managing the various traders and vendors
► Policy compliance, to protect MRML from legal challenges,
► Obtaining the best possible combination of price, quality, and service
► Coordinating procurement activities, and
► Supervising procurement staff.
Qualifications of the Procurement Manager
► Bachelor's degree program with a business emphasis
► Professional qualification in Procurement
► Ability to analyze technical data in suppliers' proposals;
► Good communication, negotiation, and mathematical skills;
► Knowledge of supply-chain management;
► Ability to perform financial analyses.
8.1.10 Human Resource Officer
The HR officer has responsibility for all of the functions that deal with the needs and
activities of MRML’s staff and these may include the following responsibility.

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► Recruiting
► Hiring
► Training
► Organization Development
► Communication
► Performance Management
► Coaching
► Policy Recommendation
► Salary and Benefits
► Team Building
► Employee Relations
► Leadership
8.1.11 Internal Audit Manager
The internal audit manager shall be charged with managing the internal audit function.
The internal audit manager shall evaluate MRML’s internal controls, processes, policies
and mechanisms to ensure that they are adequate, effective and in compliance with
regulatory principles, industry standards and corporate guidelines. He/she shall do the
work with the help of generally accepted auditing standards (GAAS) in testing or
reviewing the company‟s controls.
Qualifications of an Internal Audit Manager
► Graduate in auditing, accounting, finance or economics.
► Professional Accounting Qualifications

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8.1.12 Production Manager
The Production Manager shall be responsible for ensuring the production processes of
MRML run reliably and efficiently. His duties and responsibilities include:
► Planning and organizing production schedules.
► Assessing project and resource requirements.
► Estimating, negotiating and agreeing budgets and timescales with clients and
managers.
► Ensuring that health and safety regulations are met.
► Determining quality control standards.
► Overseeing production processes.
► Re-negotiating timescales or schedules as necessary.
► Selecting, ordering and purchasing materials.
► Organizing the repair and routine maintenance of production equipment.
► Liaising with buyers and marketing and sales staff.
► Supervising and managing the work of junior staff.
► Organizing relevant training sessions.
Qualifications of the Production Manager
► Degree in Business Management
► Industry-related experience
► Excellent organizational and time management skills
► Ability to solve problems quickly and efficiently

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8.1.13 Project Team
The following team is responsible for the development of the property to completion
before handing the over the property to MRML management.
Figure 9: Chart Showing Project Team Structure

Project Sponsors
Project Manager
Finance Specialist Procurement Internal Auditor Clerk of Works

Specialist
Contractors Architect
Quantity Electrical Civil Engineer

Surveyor Engineer
8.1.14 Roles of the Project Team
Project Sponsors
The Project sponsors have authority or influence to undertake the work and bring
about the implementation of the project. These have been selected across the entire
MRML organization to be in-charge of the entire implementation of the Project. Their
roles include;
► Defining the project
► Reviewing and approving the project progress
► Regular briefs to the board and a wider group of stakeholders

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► Authorizing payments to the consultants
Project Manager
The project manager is responsible for the implementation and success of the project.
The roles include;
► Provide interpretation of company or project vision, direction and execution of

objectives as far as the project is concerned.
► To give guidance to the sponsors throughout the project
► Ensures that the project is delivered on time, to budget and to the required quality
standard
► Ensures the project is effectively resourced and manages relationships with the
management team and the consultants
► Responsible for managing the work of consultants, allocating and utilizing

resources in an efficient manner and maintaining a co-operative, motivated and
successful team.
Finance Specialist for the Project
The role of a Finance Specialist involves the following;
► To help MRML ensure that the project‟s internal financial policies are functional
► Evaluates funding requirements for project operations
► Prepares and reports accurate and complete financial statements for the project
Procurement Specialist for the Project:
The role of a procurement specialist is to negotiate contracts and acquire the goods
and services that MRML needs for the project. Their responsibilities will include the
following;
► Responsible for MRML's spending efficiency.

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► Identify, contract, and manage the various ancillary trades and vendors for a
construction project.
► Recommending for contracting out work.
► Obtain competitive pricing, negotiate contracts,
► Work with the project manager to ensure the vendors adequately perform their
scope of work.
Project Internal Auditor:
The role of the internal auditor is to evaluate the project internal procedures or
mechanisms and ensures that they comply with project policies and regulatory
requirements. The Internal Auditor‟s role will include;
► Carrying out an independent appraisal and evaluation of the effectiveness of

controls.
► Appraising and advising on the controls to be included in new or revised systems.
Clerk of Works:
His role is to ensure that a consistent high standard of quality control and supervision is
maintained for each contract phase, via site visits, assessing contract implementation
with due regard to building and health and safety legislation and, if appropriate, to
instruct contractors to cease operations.

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9.0 OPERATING COSTS ESTIMATES AND JUSTIFICATIONS
9.1 Direct Cost Assumptions
Direct costs include the costs involved in the day-to-day running of the business based
on discussion with the project sponsors.
Table 8: Direct Costs

Direct Costs % %
Building Maintenance [0.25% of Building Costs] 79.21% Of OPEX4
Equipment Repairs & Maintenance [0.25% of Plant Costs] 12.07% Of OPEX
Motor Vehicle Fuel, Oil and Maintenance [USD ‘000s] 30 Annually
Water & Electricity [USD ‘000s] 24 Annually
All the direct costs will increase by 5% annually.
9.2 Overhead Expense Assumptions
The management of MRML has assumed the following administrative expenses.
Table 9: Administrative Expenses

Administrative Expenses % %
Salaries and Wages [USD ‘000s] 100.00 Per Year
Printing and Stationery [USD ‘000s] 4.20 Per Year
Accountancy/Tax Fees [USD ‘000s] 5.00 Per Year
Telephone and Internet Expenses [USD ‘000s] 2.40 Per Year
Staff Meals/Medical Expenses [USD ‘000s] 7.20 Per Year
Legal and Professional Fees [USD ‘000s] 10.00 Per Year
All the administrative expenses will increase by 5% every year.
9.3 Depreciation
The following table details the depreciation rates for the MRML Project’s fixed assets;
4 OPEX: Operational Expenses

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Table 10: Depreciation of Assets
Asset Depreciation Rate
Land 0%
Buildings 2%
Plant Machinery and Equipment 10%
Water Plant & Reticulation Systems 5%
Electricity Generation Plant 5%
Security Equipment & CCTV Systems 10%
Furniture and Fittings 10%
Source: MRML Management, 2021
9.4 Interest Expense
Interest expense represents the cost of the loan that the MRML Project will incur
through financing a part of its investment cost. Management has assumed the interest
rate to be 4% per year. The term loan will be for a period of 20 years with a grace period
of 2 years.
9.5 Taxation
The corporation tax rate is taken as 30% per the current tax legislation.
Tax depreciation rates for buildings, plant and machinery are 5% and 20% respectively.
The mall does not qualify for an initial allowance as it is a commercial building.
Any tax losses shall be carried forward and offset against the profits for the subsequent
years.

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10.0 FINANCIAL VIABILITY ASSESSMENT
10.1 General Assumptions
10.1.1 Projection Period
The Management of MRML has made projections for 20 years. The construction work
and all other necessary activities to bring the regional market facility to commissioning
are expected to take 60 months [i. e. 5 years].
The MRML’s projected income statements, balance sheets and cash flows from year 1
to year 20 are also included in the Financial Forecasts section at the end of this
Business Plan document on pages 97-129. The financial projections are based on the
following assumptions.
10.1.2 Significant Assumptions
The significant assumptions that have been used by the MRML Project sponsors to
estimate the Project‟s future performance throughout the first twenty years of
operations are highlighted below:
► MRML’s ability to manage all components of the Project in accordance with the
best practices,
► MRML’s ability to market all components of the Project and achieve targeted
revenue levels,
► The availability of finance for the construction phase of the project within the
projected period of 60 months.
The average number of days within which the MRML Complex will operate through
the period of the projections is 360 days; an average of 30 days a month.
10.2 Assumptions to the Economic Projections
10.2.1 Currency
The project sponsors have adopted United States Dollars (USD) as the reporting
currency for the projection period. Any local costs incurred in Uganda shall be

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translated at a rate ruling on that date.
10.2.2 Inflation
Inflation rate – It is projected the average annual inflation which is currently 4.77% will
average 5% over the projection period.
10.2.3 Discount Rate
The project sponsors have assumed and used a discount rate of 10%.
10.2.4 Growth Rate to Perpetuity
The project sponsors have assumed the growth rate to perpetuity to be 5%.
10.2.5 Foreign Exchange Earning
MRML cannot readily quantify the amount of revenue that shall be earned in foreign
currency. However, Management is certain that some of the tenants shall be billed in
United States Dollars. This has been considered for the purposes of projections to be
negligible.
10.2.6 Incremental Revenue from Tenants
The average monthly revenue expected from tenants is estimated at US$13.506 million.
It is estimated that this revenue shall increase by an average of 5% per year as a result of
better facilities (either expansion of business due availability of space and market for
goods and services, start of businesses among others). The tenants are expected to
occupy a total space of 8,000,000 square metres on --- floors of the MRML building.
Some businesses will require bigger space that the estimated average herein has been
ignored for purposes of the projections. These may include; restaurants, banks, clinics,
whole sale shops among others.
10.3 Projected Income Statement Assumptions
The following assumptions have been made with respect to revenues and
expenditures for the proposed MRML complex;

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10.3.1 Floor Area Assumptions
The MRML Complex will have a total of --- floors with a total floor area (gross) of
8,000,000 square meters;
The total lettable area will be 5,120,000 square meters, which is 64% of the total floor
area.
The breakdown of the floors and the estimated square meters per floors are provided
below:
Table 11: Floor Use

Size/Unit [Sq. mts] Estimated lettable area/Sq. mts
1,000 Warehouses 325 Sq. mts x 1,000 325,000 Sq. metres = 80.3 Acres
300 Market Shades 1,275 Sq. mts x 300 382,500 Sq. metres
50,000 shops 30 Sq. mts x 50,000 1,500,000 Sq. metres [138.38 Acres]
Commercial Parking 10 Acres 40,470 Sq. metres
International Hospital
Five-Star Hotel
Lodges
Commercial Buildings
Children's Parks
Grain Silos & Grain Drying Equipment
Electricity Plant & Equipment
Water Plant Systems
6 Petrol Stations
Day Care Centre
Livestock Market & Abattoir
Toilets
Other Facilities
Total 5,120,000
10.4 Balance Sheet Assumptions
The following assumptions have been made with respect to revenues and expenditures
for the proposed MRML Complex;
10.4.1 Working Capital
The project‟s working capital has been assumed and detailed below;
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► Inventory will constitute 10% of total direct expenses. Inventory will mainly
constitute of the cleaning materials and other utility consumables used in the day-
to-day maintenance of the MRML Complex;
► Accounts receivables include the rent paid in arrears by some tenants. It is

assumed that 10% of revenue from rent will be paid in arrears. Commercial
parking fees, market levies and advertising revenue shall be payable as and when
the service is delivered or consumed. Accounts payable include amounts due to
suppliers of items used in the day to day running of the malls. Accounts payables
will be 10% of total operating expenses.
10.4.2 Fixed Assets
Fixed assets represent the land, buildings and civil work, furniture and fixtures, other
buildings and infrastructure of the MRML Complex.
Property, plant and equipment comprise land, building, plant and machinery.
The cost of the building includes the amount paid to the contractor and includes the
cost of site preparation cost. It is estimated at USD 664,624,000 and 33.33% of the cost
of construction shall be incurred in the incurred in the first year of construction and the
rest incurred in the second (33.33%) as well as the third and final year of construction.
The start-up costs have also been capitalized and these include consultancy services of
the legal advisors, financial advisors and the architects.
Plant and machinery includes water and sewerage treatment plant, the electricity sub-
station and solar systems, security equipment and CCTV systems and other
installations. It is expected that the contractor shall construct and install the MRML
Complex with the necessary operating equipment for the running of the MRML
Complex before commissioning of the MRML Complex. It is estimated this cost shall
be incurred in these in the first to third year [for the water and power utility systems];
in the third and fourth years [for the hotels & lodges and the grain drying plant and
children‟s park]; and in the fifth year for the international hospital.
Any disposals proceeds or losses from the above plant equipment have been ignored in
these projections.

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10.5 Financing Arrangements and Source of Finance
MRML plans to fund the construction of the complex through both equity and debt at a
ratio of 2.74%: 97.26%.
10.5.1 Equity
The equity contribution is mainly in form the 466 Acre land asset at Mutukula owned
by Mutukula Regional Market Limited that is worth an estimated US$21,924,000.
The promoters have also so far injected over US$764,894 into the project and this
includes payment for consultancy services including legal, financial, engineering,
architectural and environmental, and Mutukula Town Council approvals. The
promoters have been releasing funds to the project as and when need arises. Currently
these funds are pooled in the MRML Project Bank Account.
10.5.2 Debt
The sponsors have assumed that the debt finance to be for 20 year period with a grace
period of 5 years and interest rate has been estimated to be 4% per year. MRML shall
take out a term loan in United States Dollar (USD). It is expected some of the tenants
especially corporate organizations shall be pay their rent in dollars. MRML
Management also plans to enter into a forward rate contract with financial institutions
to buy United States Dollars on loan repayment dates.
The project requires a loan of USD 777.71 million which will be repaid over a period of
20 years. This loan will be financed through rental revenues realized from warehousing
and commercial parking space, market shades and shops, income generated from the
international hospital and five-star hotel, rentals from the commercial building and
other operating business installations within the MRML Complex.
10.5.3 Project Attractiveness to Various Providers of Capital
Potential financiers to the project will be interested in the following;
► Strategic location of the MRML Complex project. The border cross point location
of the project at Mutukula Town renders it to be a regional business hub of high
cross-border trading potential within the EAC trade bloc framework within the
next 5-10 years.

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► Commitment of the project sponsors in terms of their enthusiasm and passion to

develop the project and realize its full commercial and economic value.
► Willingness and ability to pay back the loan by offering equity-shareholding in the
project to the international project financiers to be jointly involved in the routine
management and operation of the MRML Complex with the project promoters.
On completion of the loan the vendors will be entitled to a certificate of ownership
of space.
► The company will be managed by a management company that will run the day to
day operations and this will report to the Board of Directors.
10.6 Financial Statements
10.6.1 Break-even Analysis
The Mutukula Regional Market Limited Break-even Analysis figures are linked to the
main financial analysis spreadsheets (i.e. Schedules 01-12) that are appended to this
Business Plan.
The project‟s commercial break-even level (profitability break-even) in Project Year 10

[2030]is calculated below:
Table 12: Break-Even Analysis in Project Year 5 (In US$)

Items Variable Cost Fixed Cost Total Cost
Building Maintenance 1,514,727 504,909 2,019,637
Equipment Repairs & Maintenance 230,841 76,947 307,788
Motor Vehicle Fuel, Oil and Maintenance 27,349 9,116 36,465
Water & Electricity 21,879 7,293 29,172
Salaries and Wages 81,034 40,517 121,551
Printing and Stationery 3,403 1,702 5,105
Accountancy/Tax Fees 3,333 1,667 5,000
Telephone and Internet Expenses 1,945 972 2,917
Staff Meals/Medical Expenses 5,834 2,917 8,752
Legal and Professional Fees 6,667 3,333 10,000
Depreciation 0 21,135,930 21,135,930
Financial Expenses 0 22,880,000 22,880,000
TOTAL 1,897,013 44,665,304 46,562,317
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Sales Value of Production = US$196,999,529
Break-even Sales = 44,665,304 = 44,665,304 = 44,665,304

1–1,897,013 1 –0.0096 0.9904
196,999,529
Break-even Sales = US$45,099,592
Capacity utilization required to Break-even = US$45,099,592 x 100 = 22.89%

US$196,999,529
Margin of Safety = 100% – 22.89% = 77.11%.
10.6.2 Total Initial Investment Cost & Financing
The total investment cost of the project including working capital is estimated at
US$799.64 million. The major breakdown of the total initial investment cost and
financing plan is shown in Table 13below.
Table 13: Initial Project Investment Cost (In US$)

Source Share MRML Equity Investment Total
Loan
Land @ Mutukula [466 Acres] 2.74% 21,924,000 0 21,924,000
Buildings & Civil Works 83.12% 0 664,624,000 664,624,000
Plant Machinery & Equipment 5.21% 0 41,681,000 41,681,000
Water Plant & Reticulation System 2.13% 0 17,054,000 17,054,000
Electricity Sub-Station & Solar System 3.58% 0 28,651,000 28,651,000
Security Equipment & CCTV Systems 1.31% 0 10,462,000 10,462,000
Office Furniture & Fittings 0.43% 0 3,439,000 3,439,000
Start-Up Costs 1.44% 0 11,500,000 11,500,000
Working Capital Requirements 0.04% 0 300,000 300,000
TOTAL 100.00% 21,924,000 777,711,000 799,635,000
% of Total 2.74% 97.26% 100.00%
10.6.3 Total Operating Cost
The annual total operating cost at full operation capacity (2026) is estimated at US$32.45
million (see Table 14). While building maintenance and repair costs account for 79.21
per cent and equipment repairs and maintenance costs account for 12.07 per cent of

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total operating expenses respectively, administrative costs take 6.14 per cent of the
annual operating cost.
Table 14: Annual Production Cost at 100% Capacity (US$)

Items Cost %
Direct Costs/Prime Overheads
Building Maintenance 1,661,560 79.21%
Equipment Repairs & Maintenance 253,218 12.07%
Motor Vehicle Fuel, Oil and Maintenance 30,000 1.43%
Water & Electricity 24,000 1.14%
Total Direct Costs 1,968,778 93.86%
Administrative Expenses
Salaries and Wages 100,000 4.77%
Printing and Stationery 4,200 0.20%
Accountancy/Tax Fees 5,000 0.24%
Telephone and Internet Expenses 2,400 0.11%
Staff Meals/Medical Expenses 7,200 0.34%
Legal and Professional Fees 10,000 0.48%
Total Administrative Expenses 128,800 6.14%
Total Operating Expenses 2,097,578 100.00%
10.6.4 Financial Performance
Income for the Mutukula Regional Market Limited complex is realized from the
pricing margins realized on the sale of iodized salt, inorganic salts, drywall gypsum
panels and lithium as explained in Schedule 01: Key Financial Modeling Assumptions
on page 97. Net Income has been calculated by taking into account all the operational
cost and gross income for the variety of MRML complex products and services.
The stabilized average income realized by the Mutukula Regional Market Limited
complex is presented in Schedule 09: Projected Income Statement.
Summarized income and expenditure forecasts have been compiled and are set out in
Schedules 03/3, 07, and 09 respectively. These projected financial figures are based on
the assumption that the salt-processing and marketing enterprise is established and
operating effectively.
Taxation has been provided at the company income tax rate of 30%. However,
corporation tax is rebated in PY1 to PY5 [i. e. 2021-2025] as part of the government’s

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tax holiday incentive to nascent locally-based high-trade volume border cross point
markets.
10.6.5 Basis of Preparation
The generation of cash is crucial in sustaining any business, but for the purposes of this
Business Plan the forecast profit and loss account has been prepared on the cash basis of
accounting.
For the purposes of illustration all receipts and payments have been reflected on a
“cash” basis.
10.6.6 The Vehicle
As a medium-sized but highly promising salts processing and marketing enterprise, it is

imperative that Mutukula Regional Market Limited employs the most transparent,
ethical and responsible CEO and subordinate Departmental Managers to run the
business.
To this end, we would suggest the following governance mechanisms:-

A small but efficient Board of Directors be instituted to guide and control the company.
Only people who have the necessary time to devote to the business should be
considered.
Sound accounting and internal controls to be followed.
By running a business through a company the most efficient tax mechanism can be
planned and staff can be remunerated and employed on an incentives-driven basis.
10.6.7 The Accounting System and Financial Control
An up-market software accounting package will be acquired in order that the financial
condition of the business can be regularly monitored.
We see control over expenditure as a most important issue. The following methods of achieving
sound financial control will be implemented.
Annual operating budget will be approved.

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Monthly management accounts to be prepared on a timely basis and any capital
expenditure and all major running expenditures will have to be approved by the Board.
Audit shall by a reputable firm of auditors with expertise in the industry that can offer
high quality business solutions.
10.7 Project Viability
The Internal Rate of Return (IRR) is 16.23%. This is subject to shareholders‟ ability to
raise 2.74% of the project cost.
10.7.1 Sensitivity Analysis
Sensitivity analysis is performed to assess the impact of any change in the major
parameter assumptions on the IRR. Four scenarios that were conducted are as follows:
► Sensitivity (1): Change in CAPEX cost;
► Sensitivity (2): Change in rates per square metre and fee rate;
► Sensitivity (3): Change in direct expenses.
10.7.2 Change in CAPEX Cost
In this scenario we tested the effect of change in CAPEX Cost on the IRR. The results of
this scenario are summarized hereunder:
Table 15: Change in CAPEX Cost

Change in CAPEX Cost IRR
Increase by 10% 14.63%
Base Case 0% 16.23%
- Decrease by (2%) 16.59%
- Decrease by (10%) 18.12%

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10.7.3 Change in Rates per Square Metre and Fee Rate
In this scenario we tested the effect of change in rates per square metres and fee rate on
the IRR. The results of this scenario are summarized hereunder:
Table 16: Change in Rates/Square Metre and Fee

Change in Rates per Sq. Metre and Fee IRR
Base Case 0% 16.23%
- Decrease by (10%) 14.45%
10.7.4 Change in Direct Expenses
In this scenario we tested the effect of change in direct expenses on the IRR. The results
of this scenario are summarized hereunder:
Table 17: Change in Direct Expenses

Change in Direct Expense Equity IRR
Base Case 0% 16.23%
- Decrease by (10%) 16.25%
- Decrease by (20%) 16.28%
- Decrease by (30%) 16.30%
- Decrease by (40%) 16.32%
- Decrease by (50%) 16.34%

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11.0 IMPLEMENTATION SCHEDULE
The Project Implementation Schedule for the Mutukula Regional Market Limited
(MRML) that includes the design, pre-construction and construction phases is
summarized below in Figure 10.
Key:
Project Summary:
Task:
DD : Drawing Design
GMP : Good Manufacturing Practice
ISD : Internal Structural Design
MTC : Mutukula Town Council
MoLG : Ministry of Local Government
RFP : Request for Proposals
SD : Structural Design

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Figure 10: Project Implementation Schedule
ID Task Name Duration 2021 2022 2023 2024 2025
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
1
2 ACQUISITION 18 wks
3 RFP Response Due 0 days
4 Selection & Award 6 wks
5 Due Diligence & Lease Agreement 12 wks
6
7 PERMITTING 42 wks
8 Design Reviews 30 wks
9 Other Preconstruction Permitting 20 wks
10
11 DESIGN 54 wks
12 Design Concept/Dimensions/Program Finalized 12 wks
13 Elevations Developed 12 wks
14 MTC Engineering Review 4 wks
15 Schematic Design 6 wks
17 Design Development 10 wks
19 Construction Documents 12 wks
20 MTC/MoLG Engineering Review 8 wks
21
22 PRE-CONSTRUCTION 42 wks
23 Conceptual Cost Estimate 2 wks
24 SD Cost Estimate 2 wks
25 DD Cost Estimate 2 wks
26 ISD Complete Building Permit Application 1 wk
27 Full Bldg Permit Issued 4 wks
28 GMP - Earliest Possible 6 wks
29 Procurement of Contractor 4 weeks
30 Construction Start 0 days
31
32 CONSTRUCTION 45 months
33 Infrastructure/Enabling Work 15 months
34 Interior Fit Out Work 22 months
35 Exterior Signage & Façade Work 18 months
36 Construction Completion/Pre-Opening Permitting 8 months
37 Opening Day 0 days

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12.0 MONITORING MARKET DEVELOPMENT AND IMPACT
12.1 Objective of Monitoring and Evaluation
The targets for measuring the direct results of the MRML market development program
are difficult to determine at the outset. Such a program is in part capacity building, but
a significant part of a program is likely to be finance-driven (see Box 1) and often
includes a beneficiary contribution).
The three main functions of monitoring are to:
 enable assessments to be made of the social and economic impact of the program;
 determine whether resources have been correctly utilized; and
 provide an indication of what adjustment should be made in future management
and design.
Box 1:Monitoring regional market development schemes

Measures of effectiveness should include whether there are:
- Increased trade, measured by market turn-over (tons);
- Reductions in the percentage of post-harvest losses;
- Increased use of market facilities by farmers and traders;
- Better prices for market users;
- Increased market revenues; and
- Improved market maintenance and management.
Given the grassroots emphasis of a market development program the monitoring

system should aim to provide tools that can be used by the key actors at all the
implementation levels. It should inform management of the progress in implementing
the physical targets of the program. Standardized reporting on a small number of key
indicators will allow more meaningful impact assessments to be made and this
information can be used to modify the program to match changing and evolving
circumstances.

85
Table 18: Monitoring and Evaluation Impact Indicators
Functionary Expected result of improvements Indicator
Market operator: - Increased municipal revenues US$ per annum
All functionaries: - Reduced vehicle operating costs US$ per ton/km
- Increased traffic levels ADT per week
- Reduced post-harvest losses % change in losses
Producers: - Increased farm gate prices US$ per kg of produce
- Increased marketable surplus Ton per ha per annum
Wholesalers: - Increased wholesale volumes Ton per m2 per annum
- Reduced loading/unloading time Minutes per load
- Increased employment of assemblers No. of employees
Retailers: - Increased female retailers No. of female sellers
- Increased trading days No. of days per month
- higher sales volumes Ton per m2 per annum
12.2 Monitoring and Evaluation Indicators
Individual small-scale market improvements probably need only to be monitored using

simple physical indicators, such as area improved, number of stalls created and total
number of traders. For larger-scale programs the expansion of market trading activities
could also be monitored:
Regular program evaluation and reports prepared by a marketing department

supported by market committee reports should be used to monitor the marketing
improvement program. These reports will also include environmental impact and
gender dimensions (gender policy and disaggregated data). Typical indicators are
shown in Table 18.

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13.0 PROJECT BENEFICIAL IMPACTS
13.1 Trade & Industrial Benefits of MRML to Regional & Global Communities
Mutukula Regional Market will increase the intra-trade among the member states (a
population of over 172 million),bring a unique venture within a region, introduce a
unique and multi-specialty market, one of its kind in the East African region, enhance
regional cooperation of East African Community (EAC), Southern African
Development Community (SADC), Common Market for Eastern and Southern Africa
(COMESA) and African Continental Free Trade Area (AfCFTA) within the East
African region, create an enabling environment for increased trade flow among partner
states, create employment opportunities in trade industry and investment, provide
employment to over 100,000 individuals including traders and manufacturers and
investors as well as hosting over 2 Million buyers per day.
The regional market will also employ representatives from the East African Countries
,create an Eastern African regional sales point for merchandise for traders and
manufacturers within the region, conduct research into intra-East African trading
opportunities, challenges, threats, emerging trends, best practices and innovations , will
lobby and advocate for increased intra-East African trade and create an enabling
environment for trading and production within the East African states, contribute to the

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socio-economic transformation of the East African community, influence the status-quo
within the East African region through enabling access to markets for products for
agricultural and non-agricultural products, enabling support to agricultural activities
and agro-processing; enabling inspection of all items with safety and quality
requirements, increased support to agricultural activities and agro-processing,
improved management of facilities and services for the distribution of agricultural and
non- agricultural products, and provision of services and systems that add value chain
of agricultural and non- agricultural products, enhance the need and plight of the
traders, offer sector space to those products that are highly sought for among partner
states, promote tourism activities in the region, enhance revenue collections among the
partner states as traders and other stakeholders will pay taxes, create and boost inter-
relations amongst the traders and all other stakeholders, enhance the improvement on
the quality of products and services, networking of traders, farmers, lead to increased
productivity as the demand for products, goods and services will be so high. All partner
states and other countries like China, USA, UK, and UAE will produce more and more
products also to meet the demands of the global communities and will widen the
market base for the products, goods and services as over 2 million customers will be
visiting the market daily to purchase products from all over the world.
The establishment of Mutukula Regional Market will bring a unique venture within a
region that has great potential similar to the benchmarked regional markets of China
(Hua-nan, Hua-dong, Zhong-yuan, Xi-nan), USA (Eastern market in Washington DC),
London (Broadway, Borough, Columbia, Portobello and Brick Lane markets), Dubai,
Abu Dhabi, among other unique markets in world regional trade center points.
Mutukula Regional Market will create an Eastern African regional sales point for
merchandise for traders and manufacturers within the region. Mutukula Regional
Market will conduct research into intra-East African trading opportunities, challenges,
threats, emerging trends, best practices and innovations. Mutukula Regional Market
will lobby and advocate for increased intra-East African trade and create an enabling
environment for trading and production within the East African states. Mutukula
Regional Market will contribute to the socio-economic transformation of the East
African community.
Mutukula Regional Market will influence the status-quo within the East African region
through enabling access to markets for products for agricultural and non-agricultural
products, enabling support to agricultural activities and agro-processing; enabling
inspection of all items with safety and quality requirements, increased support to

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agricultural activities and agro-processing, improved management of facilities and
services for the distribution of agricultural and non- agricultural products, and
provision of services and systems that add value chain of agricultural and non-
agricultural products.
Mutukula Regional Market will enhance the need and plight of the traders that had
disintegrated into smaller markets in the East African region, making it expensive and
difficult for the clients to get quality and value added goods; most markets are not
specialized, there difficulties in getting all the required goods and services under the
same market. This has led to an influx of people with the need to travel abroad in the
quest to purchase quality goods and services so as to quench the need for the right
quality and quantity of products in East Africa, hence the establishment of Mutukula
Regional Market comes in to be the solution during this generation.
Through a comprehensive analysis of the potential for trade among the EAC partner
states, Mutukula Regional Market will offer sector space to those products that are
highly sought for among partner states. For instance, instead of a Kenyan trader
transporting products all the way to North Western Tanzania, Rwanda, Burundi or
even DRC, he/she can deliver the said goods to Mutukula Regional Market, where
buyers from Tanzania, Rwanda or Burundi can access them and conversely Kenyan
buyers can easily access products from Rwanda, Burundi or DRC. Overtime, the range
of products traded at Mutukula Regional Market will increase alongside the volumes.
The continual growth and popularity of the proposed Mutukula Regional Market has
demonstrated the potential for a central market selling a variety of products in the East
African region. A permanent regional public market can build upon this success which
will continue to attract customers from a wide geographic region as well as local
residents, workers, and traders.
Mutukula regional market will promote tourism activities in the EAC region through
creating the opportunities and better environment that can attract tourists from all over
the world.
The regional market will enhance revenue collections among the EAC partner states
as traders and other stakeholders will pay taxes. This will boost the East African
Federation and the world economies.

89
The regional market will create and boost inter-relations amongst the traders and all
other stakeholders. This will enhance the improvement on the quality of products and
services, networking of traders, farmers, among others.
The regional market will lead to increased productivity as the demand for products,
goods and services will be so high. All partner states and other countries like China,
USA, UK, and UAE will produce more and more products also to meet the demands of
the global communities.
The regional market will widen the market base for the products, goods and services
as over 2 million customers will be visiting the market daily to purchase products from
all over the world.
Mutukula regional market will rally behind the East African Federation as one of the
fastest growing regional economic blocs in the world, the EAC is widening and
deepening co-operation among the Partner States in various key spheres for their
mutual benefit. These spheres include political, economic and social. At the moment,
the regional integration process is in full swing as reflected by the encouraging progress
of the East African Customs Union, the establishment of the Common Market in 2010
and the implementation of the East African Monetary Union Protocol. The process
towards an East African Federation is being fast tracked, underscoring the serious
determination of the East African leadership and citizens to construct a powerful and
sustainable East African economic and political bloc.
Mutukula regional market will support the vision of EAC is to be a prosperous,

competitive, secure, stable and politically united East Africa as well as the mission of
the Community which is to widen and deepen economic, political, social and cultural
integration in order to improve the quality of life of the people of East Africa through
increased competitiveness, value added production, trade and investments.
Mutukula regional market will promote the Customs Union. The Customs Union is
the first Regional Integration milestone and critical foundation of the East African
Community (EAC), which has been in force since 2005, as defined in Article 75 of the
Treaty for the Establishment of the East African Community. It means that the EAC
Partner States have agreed to establish free trade (or zero duty imposed) on goods and
services amongst themselves and agreed on a common external tariff (CET), whereby
imports from countries outside the EAC zone are subjected to the same tariff when sold
to any EAC Partner State. Goods moving freely within the EAC must comply with the
EAC Rules of Origin and with certain provisions of the Protocol for the Establishment
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of the East African Community Customs Union. The market will improve on Sectorial
aspirations under the Customs Union including Agriculture and Food Security,
Customs, Health, Immigration and Labour, Industrialization & SME Development,
Infrastructure, Tourism and Wildlife Management and Trade.
Mutukula regional market will promote the common market. The Common Market is
the second Regional Integration milestone of the East African Community (EAC), which
has been in force since 2010, in line with the provisions of the EAC Treaty. It follows the
Customs Union, which became fully-fledged in January 2010. To accelerate economic
growth and development, it means that the EAC Partner States maintain a liberal stance
towards the four Freedoms of movement for all the factors of production and two
Rights between themselves. These Freedoms and Rights include: Free Movement of
Goods, Free Movement of Persons, Free Movement of Labour / Workers, Right of
Establishment, Right of Residence, Free Movement of Services, Free Movement of
Capital. The market will boost the Sectorial activities under the Common Market
including agriculture and Food Security, Culture, Customs, Education, Science and
Technology, Energy, Environment and Natural Resources, Gender, Community
Development and Civil Society, Health, Immigration and Labour, Industrialization and
SME Development, Infrastructure, Investment Promotion and Private Sector
Development, Peace and Security, Tourism and Wildlife Management and Trade.
Mutukula regional market will promote the EAC Monetary Union. The East African
Monetary Union (EAMU) is an important stage in the process of East African
Community (EAC) Regional Integration. The EAMU Protocol was adopted in
accordance with the EAC Treaty and signed on 30th November 2013; it lays
groundwork for a monetary union within 10 years and allows the EAC Partner States to
progressively converge their currencies into a single currency in the Community. In the
run-up to achieving a single currency, the EAC Partner States aim to harmonize
monetary and fiscal policies; harmonize financial, payment and settlement systems;
harmonize financial accounting and reporting practices; harmonize policies and
standards on statistical information; and, establish an East African Central Bank. The
Monetary Union targets will be promoted to include; Financial, Investment Promotion
and Private Sector Development and Trade.
Mutukula Regional Market will promote the EAC Political Federation. The Political
Federation is the ultimate goal of the EAC Regional Integration, the fourth step after the
Customs Union, Common Market and Monetary Union. It is provided for under Article
5(2) of the Treaty for the Establishment of the East African Community and founded on

91
three pillars: common foreign and security policies, good governance and effective
implementation of the prior stages of Regional Integration. It is worth noting that
attainment of the Political Federation is a process and not an event. Though the process
has been slow, the EAC Heads of State resolved at a Special Summit held in Nairobi on
27-29 August 2004 to examine ways and means of deepening and accelerating the
process through a fast-track Mechanism. The Summit set up a Committee to Fast-Track
the EAC Political Federation, dubbed the Wako Committee, to carry out wide
consultations and finalize the work on the Political Federation. The Committee
presented its report to the Summit on 29 November 2004.
Since 2004, the EAC has been putting in place initiatives to fast-track political
integration. Summit directives were given and national consultations with stakeholders
between 2006 and 2008 as well as various studies were undertaken to examine, facilitate
and fast-track the process. In the consultations, it became clear that the East African
citizens want to be adequately engaged and to have a say in the decisions and policies
pursued by the East African Community. On 20th May, 2017, the EAC Heads of State
adopted the Political Confederation as a transitional model of the East African Political
Federation which Mutukula regional fully supports.
Figure 11: East African Heads of State at a Previous Summit Meeting

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13.2 Other Considerations/Economic Analysis
13.2.1 Fiscal Impact
When the MRML Complex is completed, it is expected there will be an increase in the
revenue collected by government in form of trading license fees and income taxes as a
result of increase in business.
13.2.2 Increased Employment Opportunities
As a regional logistical hub, the MRML Complex will have 1,000 warehouses, 300
market shades and 50,000 shops plus a variety of other mixed use facilities including
an international hospital, a 5-star hotel, banking halls, offices, health clinics,
entertainment hubs, restaurants and accommodation facilities. All these MRML
facilities and structures are expected to employ over 50,000 people.
13.2.3 Improvement of Household Incomes
The project is to improve marketplace economic and social infrastructure thus inducing
incremental production and marketing of agricultural commodities, enhancing the
incomes of tenants, increasing employment and increasing customer satisfaction. This
will be achieved through:
► Improved marketplace economic and social infrastructure
► Improved marketing opportunities and conditions for farmers and vendors and
► Reducing post-harvest or post-production losses reduced and thereby increasing

quality and prices
► Contributing to poverty reduction mainly as a result of increased income

generation through increased marketed agricultural commodities and traded
merchandise. The project will facilitate gainful employment, especially with the
increase in the number of stalls/lock-ups as well as expansion of selling areas. The
project will have far reaching social welfare benefits including better working
conditions and facilities for a clean and hygienic environment leading to
improved wellbeing.

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MRML will contribute towards the development of sustainable food production, value
addition and best practices in management, leading to improved food security,
nutrition, and competitive commodity prices for consumers, improved quality of life for
market traders and environmental management practices. Specifically, the project will
encourage demand driven agricultural development in both rural and peri-urban areas
for sustainable poverty reduction.
13.2.4 Improved Market Linkages
The Mutukula Regional Market will provide ready market for goods especially
agricultural products and manufactured goods as a result of improved storage capacity
(ability to store goods for longer shelf life) expanded market capacity. Agricultural and
producers of other manufactured products will benefit thereby creating more job
opportunities in the local communities as they will be required to produce more. This
also will indirectly increase household income for both the producer/supplier and the
employees of the suppliers.
13.2.5 Environment
Development of the Mutukula Regional Market will considerably improve

environmental and hygienic sanitation, especially due to the improvement of the
drainage system in the market. An improved garbage disposal system and a bio –
electric generation plant will be introduced to ensure effective garbage collection and
recycling on a daily basis. There will be limited negative environmental impacts. Site
clearance for construction will generate waste soils and debris from demolished
structures, which will require safe disposal.

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14.0 CONCLUSIONS
14.1 Statutory Requirements
All works to be undertaken during construction of the Mutukula Regional Market

complex should comply with all relevant statutory acts and regulations including
Health and Safety Acts, National Building Regulations, Mutukula Town Council
approvals among others.
14.2 Traffic Arrangements
MRML will need to meet with Ministry of Transport and Local Government together
with Mutukula Town Council to agree on temporary and permanent access to and
from the commercial complex prior to the commencement of work on site. The MRML
and the Contractor shall provide all temporary roads, footpaths, and walkways as
deemed necessary during the period of construction and maintain such temporary
parking as necessary at all times.
14.3 Regional Market Infrastructure Development
The sponsors anticipate that Mutukula Regional Market Complex will be a

magnificent addition to East Africa‟s border cross point market infrastructure. The
business model thereof is unique and strategic, enabling the sponsors of the project to
meet their loan obligations on time and to ensure a favourable return on their
investment. It is important that the MRML organizes its shareholders well and steps
up the equity raising drive so as to quicken their access to loan financing, and also to
enable timely completion of the construction. Mutukula Regional Market Complex
promises to be a great venture.
Under the current operating assumptions the project seems to increase the wealth of the
shareholders over the projected period. This assumes that the MRML would be in
position to raise the loan financing required towards the cost of the project.
14.4 Organization
This requires a full-time Chief Executive Officer (CEO) to oversee the development and
progress of the MRML Complex as a professional business and cultural amenity for the
Mutukula Town area.

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14.5 Marketing
A commitment to advertise and promote the MRML Complex based on professional

materials that will draw people to the Mutukula Regional Market. An appeal to local
and regional residents as well as tourists based on an authentic MRML experience will
be well received.
14.6 Client Recruitment
The number of client tenants needs to be attracted to lease space in the MRML
Complex and to help draw customers including the full range of fruit and vegetable,
meat, dairy, other protein, prepared foods, household items and personal goods,
clothing and footwear, arts and crafts vendors and service providers including
warehouse and car bond operators, fuel station and auto-service garage operators, auto
spare parts retailers, carpentry and welding workshops operators, shopping malls and
supermarket operators, forex bureau operators, hardware shop retailers & wholesalers,
grain silo and grain post-harvest operators, 5-Star hotel and restaurant operators, health
centre operators, day care centre & kids amusement park operators, recreation grounds
and sports facility operators, beauty salons operators and clothing shops traders,
business office managers, solar power plant and electrical sub-station operators, water
treatment plant operators, livestock abattoir and cold room operators, and agricultural
demo farm operators and managers. There should be an aim to have approximately all
the 10, 000 client members operating in the new complex.

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Schedule 01: KEY FINANCIAL MODELLING ASSUMPTIONS
Table 19-1: Operating Assumptions

Number of Stalls/Shops in MRML Complex 50,000
Number of Warehouses in MRML Complex 1,000
Number of Market Shades in MRML Complex 300
Market Occupancy rate (Capacity Utilization) 100%
Operating Months per year 12
Operating Days per month 30
Table 19-2: Economy-Related Assumptions

Electricity price growth rate p. a. 5%
Diesel price growth rate p. a. 5%
Wage growth rate p. a. 5%
Sales Revenue growth rate p. a. 5%
Operating Expenses growth rate p. a. 5%
Table 19-3: Working Capital Calculation Assumptions

Accounts Receivable cycle (in days) 30
Accounts Payable cycle (in days) 30
Cost of Goods Sold cycle (in days) 30
Salaries & Wages cycle (in days) 90
Market Operations cycle(in days) 60
Maintenance & Repair cycle(in days) 180
Work-in-Process cycle(in days) 9
Finished Products cycle(in days) 45
Cash-in-Hand cycle(in days) 30
Total Production Costs cycle(in days) 15

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Table 19-4: Annual Revenue Assumptions (in USD) for 2026
Commodity/Service %age Share Revenue in USD (2026)
1,000 Warehouses 34.06% 55,200,000
300 Market Shades 19.81% 32,112,000
50,000 shops 29.41% 47,664,000
Commercial Parking 0.28% 456,000
International Hospital 4.07% 6,600,000
Five-Star Hotel 3.33% 5,400,000
Lodges 1.85% 3,000,000
Commercial Buildings 2.59% 4,200,000
Children's Parks 1.11% 1,800,000
Silos & Grain Drying Equipment 1.11% 1,800,000
Electricity Plant & Equipment 0.56% 912,000
Water Plant Systems 0.56% 912,000
6 Petrol Stations 0.06% 96,000
Day Care Centre 0.06% 96,000
Livestock Market & Abattoir 0.12% 192,000
Toilets 1.01% 1,632,000
Total Revenues 100.00% 162,072,000
Table 19-5: Annual Operating Expense Assumptions (in USD) for 2026
Expense Account Amount (USD)
Direct Costs/Prime Overheads
Building Maintenance 1,661,560
Equipment Repairs & Maintenance 253,218
Motor Vehicle Fuel, Oil and Maintenance 30,000
Water & Electricity 24,000
Total Direct Costs 1,968,778
Salaries and Wages 100,000
Printing and Stationery 4,200
Accountancy/Tax Fees 5,000
Telephone and Internet Expenses 2,400
Staff Meals/Medical Expenses 7,200
Legal and Professional Fees 10,000
Total Administrative Expenses 128,800
Total Operating Expenses 2,097,578

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Table 19-6: Financial Assumptions
Project Life (Years) 20
Long-Term Loan 97.26%
MRML Equity 2.74%
Interest rate on long-term debt 4%
Arrangement Fees (%age of Loan Funds) 0.025%
Brokers’ Fees (%age of Loan Funds) 0.050%
Debt tenure (Years) 20
Grace Period (Years) 5
Debt payments per year (after Grace Period) 1
Table 19-7: Depreciation Rate Assumptions

Asset Depreciation Rate
Land 0%
Buildings 2%
Plant Machinery and Equipment 10%
Water Plant & Reticulation Systems 5%
Electricity Generation Plant 5%
Security Equipment & CCTV Systems 10%
Furniture and fittings 10%

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Schedule 02/1: Project Budget (In USD)
GROSS AREA OF FACILITY 86,111,283 GSF 8,000,000 sq. metres
ACQUISITION COSTS % OF TOTAL NOTES

Land Acquisition Cost 21,924,000 2.99%
Mutukula Town Council Land and Building Clearances 75,000 0.01%
Kyotera District Land Board 50,000 0.00%
Stamp Duty 1.5 % 328,860 0.04%
Acquisition/RFP Legal 50,000 0.00%
Acquisition Engineering/Environmental/Design 40,000 0.01%
SUB-TOTAL ACQUISITION COSTS 22,407,860 3.06%
HARD COSTS
TOTAL HARD COST 664,624,000 90.63% at a rate of $12.35/GSF
Pre-construction Services 8,340,600 1.14% Cost estimating, etc.
Hard Cost Contingency (10%) 16,615,600 2.27% 10% of total hard costs
SUB-TOTAL HARD COSTS 689,580,200 94.03%
SOFT COSTS
PUBLIC RFP PROCESS
Preparation Costs 150,000 0.02% RFP Consultants' Fees + Reimbursables
DESIGN/PERMITTING/CONSULTANTS
Architecture Basic Services 6,895,802 0.94% Basic Architectural Services
Structural/MEPFP Engineering 10,000 0.00% All Structural/MEPFP consultants
A/E Permitting Services 80,000 0.01% Presentation materials, etc. etc.
A/E Reimbursables 137,916 0.01% 2% of basic services fees
Landscape Architecture 40,000 0.01% Minor plaza improvements, street furniture, etc.
Urban Design/Planning 40,000 0.01% Market area coordination
Surveys & Site Conditions Verification 40,000 0.01%
Traffic Engineer 40,000 0.01% Parking/MTC work & SCL for signage, etc.
Civil Engineering 40,000 0.01% Utility Coordination
Geotech/ Site Environmental Engineering 40,000 0.01% Confirmatory only - no design work
Market Services Consultant 0 0.00%
Lighting Consultant 50,000 0.00%
Health/Code Consultant 50,000 0.00%
Permitting Studies/Modeling 0 0.00%
Historic Consultant 0 0.00%
Testing/Commissioning 10,000 0.00% Owner's test materials & LEED Commissioning
Security/Tel/Data 10,000 0.00%
Other MRML Project Consultants 40,000 0.01%
LEED 50,000 0.00%
DEVELOPMENT FEES
Construction Manager's Fee 50,000 0.01% 20 months @ 2,500/month
MRML Staff Overhead 23,000 0.00% 20 months @ $1,150/month
LEGAL/PUBLIC RELATIONS
Permitting Legal 40,000 0.01%
Contracts & Leases Legal 40,000 0.01%
100
Schedule 02/1: Project Budget (In USD)
SOFT COSTS % OF TOTAL NOTES
Real Estate Legal 0 0.00%
Enforcement Protocol Legal 0 0.00%
Financing/ Legal 0 0.00% Depends on debt structure, if any
Title Recording 50,000 0.00%
Public Relations/Marketing 60,000 0.01% Re-opening campaign
Marketing/Advertising 50,000 0.01% Initial collateral materials & public awareness
Capital Campaign Costs 50,000 0.01% 10% of $50 Million capital campaign
FINANCING FEES
Construction/Perm/Mezz/Loan Arrangement 0 0.00%
Construction Loan Origination/Commitment 0 0.00% Assumes no debt
Construction Lender engineering fees 0 0.00%
Construction Lender legal fees 0 0.00%
Lender's Appraisal 0 0.00%
FINANCING CARRY
Construction Debt Carry 0 0.00%
Mezzanine Debt Carry 100,000 0.01%
LEASING FEES
Retail Leasing 0 0.00% No brokerage protection
OTHER SOFT COSTS
Property Taxes After Conveyance 0 0.00% Exempt
Logistics/Transportation/Misc Expenses 100,000 0.01% Development period MRML expenses
Startup Expenses 11,500,000 1.57% Allowances for staff, equipment, vehicles, etc.
Operating &CapEx Reserve 200,000 0.03% 2 yrs operating reserves
Loan Arrangement Fees (0.75%) 194,428 0.03%
Loan Brokers' Fees (1.5%) 388,856 0.05%
Sub-Total Soft Costs 20,420,001 2.78%
Soft Cost Contingency (10%) 1,021,000 0.14% 10% of total soft costs
SUB-TOTAL SOFT COSTS 21,441,001 2.92%
TOTAL DIRECT COSTS 733,429,061 100.00%
Key:
A/E: Architects/Engineers
GSF: Ground Square Feet
LEED: Leadership in Energy and Environmental Design Green Building Rating System
MEP/FP: Mechanical, Electrical, Plumbing and Fire Protection
MRML: Mutukula Regional Market Limited
MTC: Mutukula Town Council
RFP: Request for Proposals
SCL: Signcare Ltd.
*1 square metre = 10.7639 square feet

101
Schedule 02/2: Source & Structure of Project Financing (In US$)
Source Share MRML Equity Investment Loan Total
Land @ Mutukula [466 Acres] 2.74% 21,924,000 0 21,924,000
Buildings & Civil Works 83.12% 0 664,624,000 664,624,000
Plant Machinery & Equipment 5.21% 0 41,681,000 41,681,000
Water Plant & Reticulation System 2.13% 0 17,054,000 17,054,000
Electricity Sub-Station & Solar System 3.58% 0 28,651,000 28,651,000
Security Equipment & CCTV Systems 1.31% 0 10,462,000 10,462,000
Office Furniture & Fittings 0.43% 0 3,439,000 3,439,000
Start-Up Costs 1.44% 0 11,500,000 11,500,000
Working Capital Requirements 0.04% 0 300,000 300,000
TOTAL 100.00% 21,924,000 777,711,000 799,635,000
% of Total 2.74% 97.26% 100.00%

102
Schedule 03: Loan and Interest Service Schedule (In US$)
Loan Service Years
LOAN PORTFOLIO 777,711,000
Project Year 2021-25 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035
Loan Repayment 0 49,711,000 52,000,000 52,000,000 52,000,000 52,000,000 52,000,000 52,000,000 52,000,000 52,000,000 52,000,000
Interest (@ 4% p.a.) 0 31,108,440 29,150,000 27,040,000 24,960,000 22,880,000 20,800,000 18,750,000 16,640,000 14,560,000 12,480,000
Schedule 03: Loan and Interest Service Schedule (In US$)….continued

Loan Service Years
LOAN PORTFOLIO 777,711,000
Project Year 2036 2037 2038 2039 2040 Total
Loan Repayment 52,000,000 52,000,000 52,000,000 52,000,000 52,000,000 777,711,000
Interest (@ 4% p.a.) 10,400,000 8,350,000 6,240,000 4,160,000 2,080,000 249,508,440

103
Schedule 04/1: CALCULATION OF WORKING CAPITAL: I Minimum
Requirements of Current Assets and Liabilities
(a) Accounts receivable: 30 days at total production costs minus depreciation

and interest
(b) Inventory:
Direct Costs: 30 days
Salaries & Wages: 30 days
MRML Facility Operations: 60 daysat total operating expenses
Building & Equipment maintenance: 90 days
Work-in-progress: 9 days at total direct costs
Finished products: 18 days at total direct costs
© Cash-in-hand: 15 days, see separate calculations at the bottom of

Schedule 03/4.
(d) Accounts payable: 30 days of 10% total operating expenses
N.B.: All the local cost price factors for cost of sales, operational costs and working
capital are indicated in US dollars for the ease of computational and financial analysis.

104
Table 04/2: Calculation of Working Capital: II Consolidated Annual Income Estimates (USD)
ACCOUNT HEAD FINANCIAL YEAR OF OPERATION
YEAR 2021-25 2026 2027 2028 2029 2030 2031 2032 2033 2034
1,000 Warehouses 55,200,000 57,960,000 60,858,000 63,900,900 67,095,945 70,450,742 73,973,279 77,671,943 81,555,540
300 Market Shades 32,112,000 33,717,600 35,403,480 37,173,654 39,032,337 40,983,954 43,033,151 45,184,809 47,444,049
50,000 shops 47,664,000 50,047,200 52,549,560 55,177,038 57,935,890 60,832,684 63,874,319 67,068,035 70,421,436
Commercial Parking 456,000 478,800 502,740 527,877 554,271 581,984 611,084 641,638 673,720
International Hospital 6,600,000 6,930,000 7,276,500 7,640,325 8,022,341 8,423,458 8,844,631 9,286,863 9,751,206
Five-Star Hotel 5,400,000 5,670,000 5,953,500 6,251,175 6,563,734 6,891,920 7,236,516 7,598,342 7,978,259
Lodges 3,000,000 3,150,000 3,307,500 3,472,875 3,646,519 3,828,845 4,020,287 4,221,301 4,432,366
Commercial Buildings 4,200,000 4,410,000 4,630,500 4,862,025 5,105,126 5,360,383 5,628,402 5,909,822 6,205,313
Children's Parks 1,800,000 1,890,000 1,984,500 2,083,725 2,187,911 2,297,307 2,412,172 2,532,781 2,659,420
Silos & Grain Drying Equipment 1,800,000 1,890,000 1,984,500 2,083,725 2,187,911 2,297,307 2,412,172 2,532,781 2,659,420
Electricity Plant & Equipment 912,000 957,600 1,005,480 1,055,754 1,108,542 1,163,969 1,222,167 1,283,276 1,347,439
Water Plant Systems 912,000 957,600 1,005,480 1,055,754 1,108,542 1,163,969 1,222,167 1,283,276 1,347,439
6 Petrol Stations 96,000 100,800 105,840 111,132 116,689 122,523 128,649 135,082 141,836
Day Care Centre 96,000 100,800 105,840 111,132 116,689 122,523 128,649 135,082 141,836
Livestock Market & Abattoir 192,000 201,600 211,680 222,264 233,377 245,046 257,298 270,163 283,671
Toilets 1,632,000 1,713,600 1,799,280 1,889,244 1,983,706 2,082,892 2,187,036 2,296,388 2,411,207
Net Sales Revenue (USD) 162,072,000 170,175,600 178,684,380 187,618,599 196,999,529 206,849,505 217,191,981 228,051,580 239,454,159

105
Table 04/2: Calculation of Working Capital: II Consolidated Annual Income Estimates (USD)…continued
YEAR 2035 2036 2037 2038 2039 2040
1,000 Warehouses 85,633,318 89,914,983 94,410,733 99,131,269 104,087,833 109,292,224
300 Market Shades 49,816,252 52,307,064 54,922,417 57,668,538 60,551,965 63,579,564
50,000 shops 73,942,508 77,639,633 81,521,615 85,597,696 89,877,581 94,371,460
Commercial Parking 707,406 742,776 779,915 818,910 859,856 902,849
International Hospital 10,238,766 10,750,705 11,288,240 11,852,652 12,445,284 13,067,549
Five-Star Hotel 8,377,172 8,796,031 9,235,833 9,697,624 10,182,505 10,691,631
Lodges 4,653,985 4,886,684 5,131,018 5,387,569 5,656,947 5,939,795
Commercial Buildings 6,515,579 6,841,357 7,183,425 7,542,597 7,919,726 8,315,713
Children's Parks 2,792,391 2,932,010 3,078,611 3,232,541 3,394,168 3,563,877
Silos & Grain Drying Equipment 2,792,391 2,932,010 3,078,611 3,232,541 3,394,168 3,563,877
Electricity Plant & Equipment 1,414,811 1,485,552 1,559,829 1,637,821 1,719,712 1,805,698
Water Plant Systems 1,414,811 1,485,552 1,559,829 1,637,821 1,719,712 1,805,698
6 Petrol Stations 148,928 156,374 164,193 172,402 181,022 190,073
Day Care Centre 148,928 156,374 164,193 172,402 181,022 190,073
Livestock Market & Abattoir 297,855 312,748 328,385 344,804 362,045 380,147
Toilets 2,531,768 2,658,356 2,791,274 2,930,838 3,077,379 3,231,248
Net Sales Revenue (USD) 251,426,867 263,998,210 277,198,120 291,058,026 305,610,928 320,891,474

106
Table 04/3: Calculation of Working Capital: III Annual Production Cost Estimates (USD)
YEAR 2021-25 2026 2027 2028 2029 2030 2031 2032 2033 2034
Operating Costs (USD)
Building Maintenance 1,661,560 1,744,638 1,831,870 1,923,463 2,019,637 2,120,618 2,226,649 2,337,982 2,454,881
Equipment Repairs & Maintenance 253,218 265,879 279,173 293,131 307,788 323,177 339,336 356,303 374,118
Motor Vehicle Fuel, Oil and Maintenance 30,000 31,500 33,075 34,729 36,465 38,288 40,203 42,213 44,324
Water & Electricity 24,000 25,200 26,460 27,783 29,172 30,631 32,162 33,770 35,459
Total Direct Costs 1,968,778 2,067,217 2,170,578 2,279,107 2,393,062 2,512,715 2,638,351 2,770,268 2,908,782
Salaries and Wages 100,000 105,000 110,250 115,763 121,551 127,628 134,010 140,710 147,746
Printing and Stationery 4,200 4,410 4,631 4,862 5,105 5,360 5,628 5,910 6,205
Accountancy/Tax Fees 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000 5,000
Telephone and Internet Expenses 2,400 2,520 2,646 2,778 2,917 3,063 3,216 3,377 3,546
Staff Meals/Medical Expenses 7,200 7,560 7,938 8,335 8,752 9,189 9,649 10,131 10,638
Legal and Professional Fees 10,000 10,000 10,000 10,000 10,000 10,000 10,000 10,000 10,000
Total Administrative Expenses 128,800 134,490 140,465 146,738 153,325 160,241 167,503 175,128 183,134
Total Operating Expenses 2,097,578 2,201,707 2,311,042 2,425,844 2,546,387 2,672,956 2,805,854 2,945,396 3,091,916
Financial Costs (USD)

Arrangement Fees (0.025%) 194,428 0 0 0 0 0 0 0 0
Brokers' Fees (0.050%) 388,856 0 0 0 0 0 0 0 0
Interest on Long-Term Loan 31,108,440 29,150,000 27,040,000 24,960,000 22,880,000 20,800,000 18,750,000 16,640,000 14,560,000
Depreciation 21,135,930 21,135,930 21,135,930 21,135,930 21,135,930 21,135,930 21,135,930 21,135,930 21,135,930
Total Financial Costs 52,827,653 50,255,930 48,175,930 46,095,930 44,015,930 41,935,930 39,855,930 37,775,930 35,695,930
Total Production Costs 54,925,231 52,457,637 50,486,972 48,521,774 46,562,317 44,608,886 42,661,784 40,721,326 38,787,846

107
Table 04/3: Calculation of Working Capital: III Annual Production Cost Estimates (USD)….continued
YEAR 2035 2036 2037 2038 2039 2040
Operating Costs (USD)
Building Maintenance 2,577,625 2,706,506 2,841,831 2,983,923 3,133,119 3,289,775
Equipment Repairs & Maintenance 392,824 412,465 433,089 454,743 477,480 501,354
Motor Vehicle Fuel, Oil and Maintenance 46,540 48,867 51,310 53,876 56,569 59,398
Water & Electricity 37,232 39,093 41,048 43,101 45,256 47,518
Total Direct Costs 3,054,221 3,206,932 3,367,279 3,535,642 3,712,425 3,898,046
Salaries and Wages 155,133 162,889 171,034 179,586 188,565 197,993
Printing and Stationery 6,516 6,841 7,183 7,543 7,920 8,316
Accountancy/Tax Fees 5,000 5,000 5,000 5,000 5,000 5,000
Telephone and Internet Expenses 3,723 3,909 4,105 4,310 4,526 4,752
Staff Meals/Medical Expenses 11,170 11,728 12,314 12,930 13,577 14,256
Legal and Professional Fees 10,000 10,000 10,000 10,000 10,000 10,000
Total Administrative Expenses 191,541 200,368 209,637 219,368 229,587 240,316
Total Operating Expenses 3,245,762 3,407,300 3,576,915 3,755,011 3,942,011 4,138,362
Financial Costs (USD)

Arrangement Fees (0.025%) 0 0 0 0 0 0
Brokers' Fees (0.050%) 0 0 0 0 0 0
Interest on Long-Term Loan 12,480,000 10,400,000 8,350,000 6,240,000 4,160,000 2,080,000
Depreciation 21,135,930 21,135,930 21,135,930 21,135,930 21,135,930 21,135,930
Total Financial Costs 33,615,930 31,535,930 29,455,930 27,375,930 25,295,930 23,215,930
Total Production Costs 36,861,692 34,943,230 33,032,845 31,130,941 29,237,941 27,354,292

108
Schedule 04/4: Calculation of Working Capital: IV Working Capital Requirements (In US$)
X Y Requirements (USD)
Minimum Coefficient
days of Full-Capacity
Item of coverage turn-over 2026 2027 2028 2029 2030 2031 2032 2033 2034
I. Current Assets
A. Accounts receivable 30 12 174,798 183,476 192,587 202,154 212,199 222,746 233,821 245,450 257,660
B. Inventory
a) Direct Costs 30 12 164,065 172,268 180,881 189,926 199,422 209,393 219,863 230,856 242,398
b) Salaries & Wages 90 4 25,000 26,250 27,563 28,941 30,388 31,907 33,502 35,178 36,936
c) MRML Facility Operations 60 6 349,596 366,951 385,174 404,307 424,398 445,493 467,642 490,899 515,319
d) Maintenance & Repair 180 2 957,389 1,005,258 1,055,521 1,108,297 1,163,712 1,221,898 1,282,993 1,347,142 1,414,500
e) Work-in-Process 9 40 3,220 3,362 3,512 3,668 3,833 4,006 4,188 4,378 4,578
f) Finished Products 45 8 16,100 16,811 17,558 18,342 19,166 20,030 20,938 21,891 22,892
C. Cash-in-hand (from V below) 15 24 1,320,488 1,213,333 1,126,667 1,040,000 953,333 866,667 780,000 693,333 606,667
D. Current Assets _ _ 3,010,657 2,987,710 2,989,462 2,995,635 3,006,450 3,022,140 3,042,947 3,069,127 3,100,950
II. Current Liabilities

A. Accounts payable 30 12 -17,480 -18,348 -19,259 -20,215 -21,220 -22,275 -23,382 -24,545 -25,766
III. Working Capital

A. Net Working Capital 2,993,177 2,969,363 2,970,204 2,975,420 2,985,231 2,999,865 3,019,565 3,044,582 3,075,184
B. Increase in Working Capital _ -23,814 841 5,216 9,811 14,634 19,700 25,018 30,602
IV. Total Production Costs _ _ 54,925,231 52,457,637 50,486,972 48,521,774 46,562,317 44,608,886 42,661,784 40,721,326 38,787,846
Less: Direct Costs _ _ 1,968,778 2,067,217 2,170,578 2,279,107 2,393,062 2,512,715 2,638,351 2,770,268 2,908,782
Administrative Expenses _ _ 128,800 134,490 140,465 146,738 153,325 160,241 167,503 175,128 183,134
Depreciation _ _ 21,135,930 21,135,930 21,135,930 21,135,930 21,135,930 21,135,930 21,135,930 21,135,930 21,135,930
15 24 31,691,723 29,150,000 27,040,000 24,960,000 22,880,000 20,800,000 18,750,000 16,640,000 14,560,000
V. Required Cash Balance _ _ 1,320,488 1,213,333 1,126,667 1,040,000 953,333 866,667 780,000 693,333 606,667

109
Schedule 04/4: Calculation of Working Capital: IV Working Capital Requirements (In US$)….continued
X Y Requirements (USD)
Minimum Coefficient
days of Full-Capacity
Item of coverage turn-over 2035 2036 2037 2038 2039 2040
I. Current Assets
A. Accounts receivable 30 12 270,480 283,942 298,076 312,918 328,501 344,863
B. Inventory
a) Direct Costs 30 12 254,518 267,244 280,607 294,637 309,369 324,837
b) Salaries & Wages 90 4 38,783 40,722 42,758 44,896 47,141 49,498
c) MRML Facility Operations 60 6 540,960 567,883 596,153 625,835 657,002 689,727
d) Maintenance & Repair 180 2 1,485,225 1,559,486 1,637,460 1,719,333 1,805,300 1,895,565
e) Work-in-Process 9 40 4,789 5,009 5,241 5,484 5,740 6,008
f) Finished Products 45 8 23,943 25,046 26,205 27,421 28,698 30,040
C. Cash-in-hand (from V below) 15 24 550,000 433,333 346,667 260,000 173,333 86,667
D. Current Assets _ _ 3,138,698 3,182,666 3,233,166 3,290,524 3,355,084 3,427,205
II. Current Liabilities

A. Accounts payable 30 12 -27,048 -28,394 -29,808 -31,292 -32,850 -34,486
III. Working Capital

A. Net Working Capital 3,111,650 3,154,272 3,203,358 3,259,233 3,322,234 3,392,718
B. Increase in Working Capital 36,465 42,622 49,087 55,874 63,001 70,485
IV. Total Production Costs _ _ 36,861,692 34,943,230 33,032,845 31,130,941 29,237,941 27,354,292
Less: Direct Costs _ _ 3,054,221 3,206,932 3,367,279 3,535,642 3,712,425 3,898,046

Administrative Expenses _ _ 191,541 200,368 209,637 219,368 229,587 240,316
Depreciation _ _ 21,135,930 21,135,930 21,135,930 21,135,930 21,135,930 21,135,930
15 24 12,480,000 10,400,000 8,350,000 6,240,000 4,160,000 2,080,000
V. Required Cash Balance _ _ 550,000 433,333 346,667 260,000 173,333 86,667

110
Schedule 05: Fixed Assets and Depreciation Allowances in US$
Year 2021-25 2026 2027 2028 2029 2030 2031 2032 2033 2034
Initial Dep Dep Dep Dep Dep Dep Dep Dep Dep
Asset Value Allowance Allowance Allowance Allowance Allowance Allowance Allowance Allowance Allowance
Buildings & Civil Works 664,624,000 13,292,480 13,292,480 13,292,480 13,292,480 13,292,480 13,292,480 13,292,480 13,292,480 13,292,480
Plant Machinery & Equipment 41,681,000 4,168,100 4,168,100 4,168,100 4,168,100 4,168,100 4,168,100 4,168,100 4,168,100 4,168,100
Water Systems 17,054,000 852,700 852,700 852,700 852,700 852,700 852,700 852,700 852,700 852,700
Electricity Generation Plant 28,651,000 1,432,550 1,432,550 1,432,550 1,432,550 1,432,550 1,432,550 1,432,550 1,432,550 1,432,550
Security Equipment & CCTV Systems 10,462,000 1,046,200 1,046,200 1,046,200 1,046,200 1,046,200 1,046,200 1,046,200 1,046,200 1,046,200
Office Furniture & Fittings 3,439,000 343,900 343,900 343,900 343,900 343,900 343,900 343,900 343,900 343,900
TOTALS 765,911,000 21,135,930 21,135,930 21,135,930 21,135,930 21,135,930 21,135,930 21,135,930 21,135,930 21,135,930

111
Schedule 05: Fixed Assets and Depreciation Allowances in US$....continued
Year 2035 2036 2037 2038 2039 2040
Initial Dep Dep Dep Dep Dep
Asset Value Allowance Allowance Allowance Allowance Allowance
Buildings & Civil Works 13,292,480 13,292,480 13,292,480 13,292,480 13,292,480 13,292,480
Plant Machinery & Equipment 4,168,100 4,168,100 4,168,100 4,168,100 4,168,100 4,168,100
Water Systems 852,700 852,700 852,700 852,700 852,700 852,700
Electricity Generation Plant 1,432,550 1,432,550 1,432,550 1,432,550 1,432,550 1,432,550
Security Equipment & CCTV Systems 1,046,200 1,046,200 1,046,200 1,046,200 1,046,200 1,046,200
Office Furniture & Fittings 343,900 343,900 343,900 343,900 343,900 343,900
TOTALS 21,135,930 21,135,930 21,135,930 21,135,930 21,135,930 21,135,930

112
Schedule 06: Change in Total Investment Costs (In US$)
Period Construction Full Capacity
Year 2021-25 2026 2027 2028 2029 2030 2031 2032 2033 2034
1. Fixed Investment Costs 787,835,000 0 0 0 0 0 0 0 0 0

a) Initial fixed investment costs 787,835,000 0 0 0 0 0 0 0 0 0
b) Replacement 0 0 0 0 0 0 0 0 0 0
2. Pre-operational expenses 11,800,000 0 0 0 0 0 0 0 0 0
3. Working Capital increase 0 2,993,177 -23,814 841 5,216 9,811 14,634 19,700 25,018 30,602
Total Investment Costs 799,635,000 2,993,177 -23,814 841 5,216 9,811 14,634 19,700 25,018 30,602
Schedule 06: Change in Total Assets (In US$)….continued

Period Full Capacity
Year 2035 2036 2037 2038 2039 2040 Total
1. Fixed Investment Costs 0 0 0 0 0 0 787,835,000

a) Initial fixed investment costs 0 0 0 0 0 0 787,835,000
b) Replacement 0 55,582,000 0 0 0 0 55,582,000
2. Pre-operational expenses 0 0 0 0 0 0 11,800,000
3. Working Capital increase 36,465 42,622 49,087 55,874 63,001 70,485 3,392,718
Total Assets 36,465 55,624,622 49,087 55,874 63,001 70,485 858,609,718

113
Schedule 07: Change in Total Assets (In US$)
Period Construction Full Capacity
Year 2021-25 2026 2027 2028 2029 2030 2031 2032 2033 2034
1. Fixed (Long-Term) Assets

Water Systems 17,054,000 15,348,600 13,643,200 11,937,800 10,232,400 8,527,000 6,821,600 5,116,200 3,410,800 1,705,400
Office Furniture & Fittings 3,439,000 3,095,100 2,751,200 2,407,300 2,063,400 1,719,500 1,375,600 1,031,700 687,800 343,900
Sub-Total Fixed Assets 765,911,000 744,445,470 722,979,940 701,514,410 680,048,880 658,583,350 637,117,820 615,652,290 594,186,760 572,721,230
2. Current Assets
Accounts Receivable 0 174,798 183,476 192,587 202,154 212,199 222,746 233,821 245,450 257,660
Stock (Inventory) 0 1,515,370 1,590,901 1,670,209 1,753,482 1,840,918 1,932,727 2,029,125 2,130,344 2,236,624
Bank Balance and Cash 0 1,320,488 1,213,333 1,126,667 1,040,000 953,333 866,667 780,000 693,333 606,667
Other Current Assets 11,800,000 181,670,775 214,568,078 253,229,936 299,643,003 354,122,039 416,997,542 488,616,534 569,343,391 659,560,707
Sub-Total Current Assets 11,800,000 184,681,431 217,555,788 256,219,399 302,638,639 357,128,489 420,019,682 491,659,481 572,412,518 662,661,657
Total Assets 777,711,000 929,126,901 940,535,728 957,733,809 982,687,519 1,015,711,839 1,057,137,502 1,107,311,771 1,166,599,278 1,235,382,887

114
Schedule 07: Change in Total Assets (In US$)….continued
Year 2035 2036 2037 2038 2039 2040

Plant Machinery & Equipment 0 37,512,900 33,344,800 29,176,700 25,008,600 20,840,500
Water Systems 0 15,348,600 13,643,200 11,937,800 10,232,400 8,527,000
Office Furniture & Fittings 0 3,095,100 2,751,200 2,407,300 2,063,400 1,719,500
Sub-Total Fixed Assets 551,255,700 591,964,170 570,498,640 549,033,110 527,567,580 506,102,050
2. Current Assets
Accounts Receivable 270,480 283,942 298,076 312,918 328,501 344,863
Stock (Inventory) 2,348,218 2,465,391 2,588,423 2,717,607 2,853,250 2,995,675
Bank Balance and Cash 550,000 433,333 346,667 260,000 173,333 86,667
Other Current Assets 759,670,203 807,919,690 929,100,066 1,061,502,376 1,205,614,916 1,361,950,399
Sub-Total Current Assets 762,808,901 811,102,356 932,333,232 1,064,792,900 1,208,970,000 1,365,377,603
Total Assets 1,314,064,601 1,403,066,526 1,502,831,872 1,613,826,010 1,736,537,580 1,871,479,653

115
Schedule 08: Projected Cash Flow Table (In US$)
Year 2021-25 2026 2027 2028 2029 2030 2031 2032 2033 2034
Costs (US Dollars)
A. Cash inflow 777,711,000 162,072,000 170,175,600 178,684,380 187,618,599 196,999,529 206,849,505 217,191,981 228,051,580 239,454,159
1. Financial resources total 777,711,000 _ _ _ _ _ _ _ _ _
2. Sales revenue total _ 162,072,000 170,175,600 178,684,380 187,618,599 196,999,529 206,849,505 217,191,981 228,051,580 239,454,159
B. Cash outflow -777,711,000 -258,479,414 -121,186,701 -128,149,124 -137,209,381 -146,722,650 -156,711,583 -167,199,961 -178,212,759 -189,776,198
1. Total assets schedule
including replacements -777,711,000 -151,415,901 -11,408,827 -17,198,081 -24,953,710 -33,024,320 -41,425,662 -50,174,269 -59,287,508 -68,783,609
2. Operating Costs _ -2,097,578 -2,201,707 -2,311,042 -2,425,844 -2,546,387 -2,672,956 -2,805,854 -2,945,396 -3,091,916
3. Debt Service
a) Interest _ -31,108,440 -29,150,000 -27,040,000 -24,960,000 -22,880,000 -20,800,000 -18,750,000 -16,640,000 -14,560,000
b) Repayments _ -49,711,000 -52,000,000 -52,000,000 -52,000,000 -52,000,000 -52,000,000 -52,000,000 -52,000,000 -52,000,000
4. Corporate tax _ -23,746,495 -26,056,168 -29,200,001 -32,469,826 -35,871,943 -39,412,965 -43,099,838 -46,939,855 -50,940,673
5. Dividends 4% on equity _ -400,000 -400,000 -400,000 -400,000 -400,000 -400,000 -400,000 -400,000 -400,000
C. Surplus / deficit 0 -96,407,414 48,988,899 50,535,256 50,409,218 50,276,879 50,137,922 49,992,020 49,838,821 49,677,961
D. Cumulative cash balance 0 -96,407,414 -47,418,515 3,116,740 53,525,958 103,802,838 153,940,760 203,932,780 253,771,600 303,449,561
*Salvage values. Land: 21,924,000; 60% of buildings: 465,236,800; Working Capital : 3,392,718 490,553,518

116
Schedule 08: Projected Cash Flow Table (In US$)….continued
Year 2035 2036 2037 2038 2039 2040 Salvage Value Total
Costs (US Dollars)
A. Cash inflow 251,426,867 263,998,210 277,198,120 291,058,026 305,610,928 320,891,474 4,274,991,958
1. Financial resources total _ _ _ _ _ _ 777,711,000
2. Sales revenue total 251,426,867 263,998,210 277,198,120 291,058,026 305,610,928 320,891,474 3,497,280,958
B. Cash outflow -201,917,808 -214,666,498 -228,052,622 -242,108,054 -256,866,256 -272,362,369 490,553,518 -3,082,212,925
1. Total assets schedule
including replacements -78,681,714 -89,001,925 -99,765,346 -110,994,138 -122,711,570 -134,942,074 490,553,518 -1,380,926,135
2. Operating Costs -3,245,762 -3,407,300 -3,576,915 -3,755,011 -3,942,011 -4,138,362 0 -45,164,042
3. Debt Service
a) Interest -12,480,000 -10,400,000 -8,350,000 -6,240,000 -4,160,000 -2,080,000 0 -218,400,000
b) Repayments -52,000,000 -52,000,000 -52,000,000 -52,000,000 -52,000,000 -52,000,000 0 -728,000,000
4. Corporate tax -55,110,331 -59,457,273 -63,990,362 -68,718,905 -73,652,675 -78,801,934 0 -703,722,748
5. Dividends 4% on equity -400,000 -400,000 -400,000 -400,000 -400,000 -400,000 0 -6,000,000
C. Surplus / deficit 49,509,059 49,331,712 49,145,498 48,949,973 48,744,672 48,529,105 490,553,518 1,088,213,098
D. Cumulative cash balance 352,958,620 402,290,333 451,435,831 500,385,803 549,130,475 597,659,580 1,088,213,098
*Salvage values. Land: 21,924,000; 60% of buildings: 465,236,800; Working Capital : 3,392,718 490,553,518

117
Schedule 09: Projected Cashflow Table and Calculation of Present Value (In US$)
Year 2021-25 2026 2027 2028 2029 2030 2031 2032 2033 2034
Constr. Full Capacity
Investment Costs -777,711,000 _ _ _ _ _ _ _ _ _

Net Profit after Tax* _ 55,408,487 60,797,725 68,133,336 75,762,928 83,701,200 91,963,585 100,566,289 109,526,328 118,861,570
Depreciation _ 21,135,930 21,135,930 21,135,930 21,135,930 21,135,930 21,135,930 21,135,930 21,135,930 21,135,930
Interest Add back
Mid-term Loan _ 31,108,440 29,150,000 27,040,000 24,960,000 22,880,000 20,800,000 18,750,000 16,640,000 14,560,000
NET CASH FLOWS -777,711,000 107,652,857 111,053,655 116,309,266 121,858,858 127,717,130 133,899,515 140,422,219 147,302,258 154,557,500
Discount Factors at 10% 0.9091 0.8264 0.7513 0.683 0.6209 0.5645 0.5132 0.4665 0.4241 0.3855
PV at 10% -707,017,070 88,964,321 83,434,611 79,439,229 75,662,165 72,096,320 68,717,231 65,506,965 62,470,888 59,581,916
NPV at 10%
Discount Factors at 12% 0.8929 0.7972 0.7118 0.6355 0.5674 0.5066 0.4523 0.4039 0.3606 0.322
PV at 12% -694,418,152 85,820,858 79,047,992 73,914,539 69,142,716 64,701,498 60,562,750 56,716,534 53,117,194 49,767,515
NPV at 12%
Internal Rate of Return = 16.23%

16.23%
NPV at 14% = USD 360,178,161
NPV at 17% = USD 217,901,822

118
Schedule 09: Projected Cashflow Table and Calculation of Present Value (In US$)….continued
Year 2035 2036 2037 2038 2039 2040 *Salvage
value Total
Full Capacity
Investment Costs _ _ _ _ _ _ _ -777,711,000

Net Profit after Tax* 128,590,773 138,733,637 149,310,844 160,344,111 171,856,241 183,871,179 _ 1,697,428,233
Depreciation 21,135,930 21,135,930 21,135,930 21,135,930 21,135,930 21,135,930 _ 295,903,020
Interest Add back
Mid-term Loan 12,480,000 10,400,000 8,350,000 6,240,000 4,160,000 2,080,000 _ 218,400,000
NET CASH FLOWS 162,206,703 170,269,567 178,766,774 187,720,041 197,152,171 207,087,109 490,553,518 1,976,818,141
Discount Factors at 10% 0.3505 0.3186 0.2897 0.2633 0.2394 0.2176 0.2176 _
PV at 10% 56,853,449 54,247,884 51,788,734 49,426,687 47,198,230 45,062,155 106,744,446 360,178,161
NPV at 10% 360,178,161
Discount Factors at 12% 0.2875 0.2567 0.2292 0.2046 0.1827 0.1631 0.1631 _
PV at 12% 46,634,427 43,708,198 40,973,345 38,407,520 36,019,702 33,775,907 80,009,279 217,901,822
NPV at 12% 217,901,822
Internal Rate of Return = 16.23%

16.23%
NPV at 14% = USD 360,178,161
NPV at 17% = USD 217,901,822

119
Schedule 10: Projected Income Statement (In US$)
Year 2021-25 2026 2027 2028 2029 2030 2031 2032 2033 2034
Income _ 162,072,000 170,175,600 178,684,380 187,618,599 196,999,529 206,849,505 217,191,981 228,051,580 239,454,159
Cost of Goods Sold _ 1,968,778 2,067,217 2,170,578 2,279,107 2,393,062 2,512,715 2,638,351 2,770,268 2,908,782
GROSS PROFIT _ 160,103,222 168,108,383 176,513,802 185,339,492 194,606,467 204,336,790 214,553,630 225,281,311 236,545,377
Less: Operating Costs

(excl. Direct Costs) _ 128,800 134,490 140,465 146,738 153,325 160,241 167,503 175,128 183,134
OPERATING PROFIT _ 159,974,422 167,973,893 176,373,338 185,192,755 194,453,142 204,176,549 214,386,127 225,106,183 236,362,242
Less: Accrued interest on

Long-Term Loan (@ 4% p.a.) _ 31,108,440 29,150,000 27,040,000 24,960,000 22,880,000 20,800,000 18,750,000 16,640,000 14,560,000
Less: Annual Repayments* _ 49,711,000 52,000,000 52,000,000 52,000,000 52,000,000 52,000,000 52,000,000 52,000,000 52,000,000
NET PROFIT BEFORE TAX 0 79,154,982 86,853,893 97,333,338 108,232,755 119,573,142 131,376,549 143,666,127 156,466,183 169,802,242
Corporation Tax 30% 0 23,746,495 26,056,168 29,200,001 32,469,826 35,871,943 39,412,965 43,099,838 46,939,855 50,940,673
NET PROFIT _ 55,408,487 60,797,725 68,133,336 75,762,928 83,701,200 91,963,585 100,566,289 109,526,328 118,861,570
Accumulated Net Profit (Loss) _ 55,408,487 116,206,213 184,339,549 260,102,477 343,803,677 435,767,262 536,333,550 645,859,879 764,721,448
Net Profit Margin _ 34.19% 35.73% 38.13% 40.38% 42.49% 44.46% 46.30% 48.03% 49.64%
Gross Profit Margin 98.79% 98.79% 98.79% 98.79% 98.79% 98.79% 98.79% 98.79% 98.79%
Rate of Return on Investment _ 6.93% 7.60% 8.52% 9.47% 10.47% 11.50% 12.58% 13.70% 14.86%
Operating Profit Margin _ 98.71% 98.71% 98.71% 98.71% 98.71% 98.71% 98.71% 98.71% 98.71%

120
Schedule 10: Projected Income Statement (In US$)….continued
Year 2035 2036 2037 2038 2039 2040
Income 251,426,867 263,998,210 277,198,120 291,058,026 305,610,928 320,891,474

Cost of Goods Sold 3,054,221 3,206,932 3,367,279 3,535,642 3,712,425 3,898,046
GROSS PROFIT 248,372,646 260,791,278 273,830,842 287,522,384 301,898,503 316,993,428
Less: Operating Costs

(excl. Direct Costs) 191,541 200,368 209,637 219,368 229,587 240,316
OPERATING PROFIT 248,181,105 260,590,910 273,621,205 287,303,016 301,668,916 316,753,112
Less: Accrued interest on

Long-Term Loan (@ 4% p.a.) 12,480,000 10,400,000 8,350,000 6,240,000 4,160,000 2,080,000
Less: Annual Repayments* 52,000,000 52,000,000 52,000,000 52,000,000 52,000,000 52,000,000
NET PROFIT BEFORE TAX 183,701,105 198,190,910 213,301,205 229,063,016 245,508,916 262,673,112
Corporation Tax 30% 55,110,331 59,457,273 63,990,362 68,718,905 73,652,675 78,801,934
NET PROFIT 128,590,773 138,733,637 149,310,844 160,344,111 171,856,241 183,871,179
Accumulated Net Profit (Loss) 893,312,222 1,032,045,859 1,181,356,702 1,341,700,813 1,513,557,055 1,697,428,233
Net Profit Margin 51.14% 52.55% 53.86% 55.09% 56.23% 57.30%
Gross Profit Margin 98.79% 98.79% 98.79% 98.79% 98.79% 98.79%
Rate of Return on Investment 16.08% 17.35% 18.67% 20.05% 21.49% 22.99%
Operating Profit Margin 98.71% 98.71% 98.71% 98.71% 98.71% 98.71%

121
Schedule 11: Projected Balance Sheet (In US$)
YEAR 2021-25 2026 2027 2028 2029 2030 2031 2032 2033 2034
ASSETS
Water Systems 17,054,000 15,348,600 13,643,200 11,937,800 10,232,400 8,527,000 6,821,600 5,116,200 3,410,800 1,705,400
Office Furniture & Fittings 3,439,000 3,095,100 2,751,200 2,407,300 2,063,400 1,719,500 1,375,600 1,031,700 687,800 343,900
Sub-Total Fixed Assets 765,911,000 744,445,470 722,979,940 701,514,410 680,048,880 658,583,350 637,117,820 615,652,290 594,186,760 572,721,230
2. Current Assets
Accounts Receivable 0 174,798 183,476 192,587 202,154 212,199 222,746 233,821 245,450 257,660
Stock (Inventory) 0 1,515,370 1,590,901 1,670,209 1,753,482 1,840,918 1,932,727 2,029,125 2,130,344 2,236,624
Bank Balance and Cash 0 1,320,488 1,213,333 1,126,667 1,040,000 953,333 866,667 780,000 693,333 606,667
Other Current Assets 11,800,000 181,670,775 214,568,078 253,229,936 299,643,003 354,122,039 416,997,542 488,616,534 569,343,391 659,560,707
Sub-Total Current Assets 11,800,000 184,681,431 217,555,788 256,219,399 302,638,639 357,128,489 420,019,682 491,659,481 572,412,518 662,661,657
Total Assets 777,711,000 929,126,901 940,535,728 957,733,809 982,687,519 1,015,711,839 1,057,137,502 1,107,311,771 1,166,599,278 1,235,382,887
LIABILITIES
3. Current Liabilities
Accounts payable 17,480 18,348 19,259 20,215 21,220 22,275 23,382 24,545 25,766
Income taxes payable 23,746,495 26,056,168 29,200,001 32,469,826 35,871,943 39,412,965 43,099,838 46,939,855 50,940,673
Sub-Total Current Liabilities 0 23,763,974 26,074,515 29,219,260 32,490,042 35,893,163 39,435,239 43,123,220 46,964,400 50,966,439
4. Long-Term Liabilities
Loans and Advances 777,711,000 777,711,000 728,000,000 676,000,000 624,000,000 572,000,000 550,000,000 468,000,000 416,000,000 364,000,000
Interest Payments 31,108,440 29,150,000 27,040,000 24,960,000 22,880,000 20,800,000 18,750,000 16,640,000 14,560,000
Sub-Total Long-Term Liabilities 777,711,000 808,819,440 757,150,000 703,040,000 648,960,000 594,880,000 540,800,000 486,750,000 432,640,000 378,560,000
5. Owner's Equity
Share Capital 10,000,000 10,000,000 10,000,000 10,000,000 10,000,000 10,000,000 10,000,000 10,000,000 10,000,000
General Reserve Fund 31,135,000 31,135,000 31,135,000 31,135,000 31,135,000 31,135,000 31,135,000 31,135,000 31,135,000
Retained Earnings 55,408,487 116,206,213 184,339,549 260,102,477 343,803,677 435,767,262 536,333,550 645,859,879 764,721,448
Sub-Total Owner's Equity 0 96,543,487 157,341,213 225,474,549 301,237,477 384,938,677 476,902,262 577,468,550 686,994,879 805,856,448
Total Liabilities & Owner's Equity 777,711,000 929,126,902 940,535,728 957,733,809 982,687,519 1,015,711,840 1,057,137,501 1,107,311,771 1,166,599,279 1,235,382,887

122
Schedule 11: Projected Balance Sheet (In US$)….continued
YEAR 2035 2036 2037 2038 2039 2040
ASSETS
Plant Machinery & Equipment 0 37,512,900 33,344,800 29,176,700 25,008,600 20,840,500
Water Systems 0 15,348,600 13,643,200 11,937,800 10,232,400 8,527,000
Office Furniture & Fittings 0 3,095,100 2,751,200 2,407,300 2,063,400 1,719,500
Sub-Total Fixed Assets 551,255,700 591,964,170 570,498,640 549,033,110 527,567,580 506,102,050
2. Current Assets
Accounts Receivable 270,480 283,942 298,076 312,918 328,501 344,863
Stock (Inventory) 2,348,218 2,465,391 2,588,423 2,717,607 2,853,250 2,995,675
Bank Balance and Cash 550,000 433,333 346,667 260,000 173,333 86,667
Other Current Assets 759,670,203 807,919,690 929,100,066 1,061,502,376 1,205,614,916 1,361,950,399
Sub-Total Current Assets 762,808,901 811,102,356 932,333,232 1,064,792,900 1,208,970,000 1,365,377,603
Total Assets 1,314,064,601 1,403,066,526 1,502,831,872 1,613,826,010 1,736,537,580 1,871,479,653

LIABILITIES
3. Current Liabilities
Accounts payable 27,048 28,394 29,808 31,292 32,850 34,486
Income taxes payable 55,110,331 59,457,273 63,990,362 68,718,905 73,652,675 78,801,934
Sub-Total Current Liabilities 55,137,379 59,485,667 64,020,169 68,750,196 73,685,525 78,836,420
4. Long-Term Liabilities
Loans and Advances 312,000,000 260,000,000 208,000,000 156,000,000 104,000,000 52,000,000
Interest Payments 12,480,000 10,400,000 8,350,000 6,240,000 4,160,000 2,080,000
Sub-Total Long-Term Liabilities 324,480,000 270,400,000 216,350,000 162,240,000 108,160,000 54,080,000
5. Owner's Equity
Share Capital 10,000,000 10,000,000 10,000,000 10,000,000 10,000,000 10,000,000
General Reserve Fund 31,135,000 31,135,000 31,135,000 31,135,000 31,135,000 31,135,000
Retained Earnings 893,312,222 1,032,045,859 1,181,356,702 1,341,700,813 1,513,557,055 1,697,428,233
Sub-Total Owner's Equity 934,447,222 1,073,180,859 1,222,491,702 1,382,835,813 1,554,692,055 1,738,563,233
Total Liabilities & Owner's Equity 1,314,064,601 1,403,066,526 1,502,831,872 1,613,826,010 1,736,537,580 1,871,479,653

123
Schedule 12: Ratio Analysis (In US$)
Period Construct Full Capacity
Year 2021-25 2026 2027 2028 2029 2030 2031 2032 2033 2034
Sales Growth 5% 5% 5% 5% 5% 5% 5% 5%
Percent of Total Assets

Accounts Receivable 0.02% 0.02% 0.02% 0.02% 0.02% 0.02% 0.02% 0.02% 0.02%
Inventory 0.16% 0.17% 0.17% 0.18% 0.18% 0.18% 0.18% 0.18% 0.18%
Other Current Assets 19.55% 22.81% 26.44% 30.49% 34.86% 39.45% 44.13% 48.80% 53.39%
Total Current Assets 19.88% 23.13% 26.75% 30.80% 35.16% 39.73% 44.40% 49.07% 53.64%
Long-term Assets 80.12% 76.87% 73.25% 69.20% 64.84% 60.27% 55.60% 50.93% 46.36%
Total Assets 100.00% 100.00% 100.00% 100.00% 100.00% 100.00% 100.00% 100.00% 100.00%
Current Liabilities 2.56% 2.77% 3.05% 3.31% 3.53% 3.73% 3.89% 4.03% 4.13%
Long-term liabilities 87.05% 80.50% 73.41% 66.04% 58.57% 51.16% 43.96% 37.09% 30.64%
Total Liabilities 89.61% 83.27% 76.46% 69.35% 62.10% 54.89% 47.85% 41.11% 34.77%
Net Worth (Total Capital) 10.39% 16.73% 23.54% 30.65% 37.90% 45.11% 52.15% 58.89% 65.23%
Percent of Revenues
Revenues 100.00% 100.00% 100.00% 100.00% 100.00% 100.00% 100.00% 100.00% 100.00%
Gross Margin 98.79% 98.79% 98.79% 98.79% 98.79% 98.79% 98.79% 98.79% 98.79%
Management / Administration 0.08% 0.08% 0.08% 0.08% 0.08% 0.08% 0.08% 0.08% 0.08%
Net Profit (after Interest & Tax) 34.19% 35.73% 38.13% 40.38% 42.49% 44.46% 46.30% 48.03% 49.64%
Main Ratios
Current 7.77 8.34 8.77 9.31 9.95 10.65 11.40 12.19 13.00
Quick 7.71 8.28 8.71 9.26 9.90 10.60 11.35 12.14 12.96
Total Debt to Total Assets 83.70% 77.40% 70.58% 63.50% 56.32% 49.19% 42.26% 35.66% 29.46%
Pre-tax Return on Net Worth 81.99% 55.20% 43.17% 35.93% 31.06% 27.55% 24.88% 22.78% 21.07%
Pre-tax Return on Assets 8.52% 9.23% 10.16% 11.01% 11.77% 12.43% 12.97% 13.41% 13.74%
Business Vitality Profile

Revenue per Tenant $3,241 $3,404 $3,574 $3,752 $3,940 $4,137 $4,344 $4,561 $4,789

124
Schedule 12: Ratio Analysis….continued
Year 2035 2036 2037 2038 2039 2040
Sales Growth 5% 5% 5% 5%
Percent of Total Assets

Accounts Receivable 0.02% 0.02% 0.02% 0.02% 0.02% 0.02%
Inventory 0.18% 0.18% 0.17% 0.17% 0.16% 0.16%
Other Current Assets 57.81% 57.58% 61.82% 65.78% 69.43% 72.77%
Total Current Assets 58.05% 57.81% 62.04% 65.98% 69.62% 72.96%
Long-term Assets 41.95% 42.19% 37.96% 34.02% 30.38% 27.04%
Total Assets 100.00% 100.00% 100.00% 100.00% 100.00% 100.00%
Current Liabilities 4.20% 4.24% 4.26% 4.26% 4.24% 4.21%

Long-term liabilities 24.69% 19.27% 14.39% 10.05% 6.23% 2.89%
Total Liabilities 28.89% 23.51% 18.65% 14.31% 10.47% 7.10%
Net Worth (Total Capital) 71.11% 76.49% 81.35% 85.69% 89.53% 92.90%
Percent of Revenues
Revenues 100.00% 100.00% 100.00% 100.00% 100.00% 100.00%
Gross Margin 98.79% 98.79% 98.79% 98.79% 98.79% 98.79%
Management / Administration 0.08% 0.08% 0.08% 0.08% 0.08% 0.07%
Net Profit (after Interest & Tax) 51.14% 52.55% 53.86% 55.09% 56.23% 57.30%
Main Ratios
Current 13.83 13.64 14.56 15.49 16.41 17.32
Quick 13.79 13.59 14.52 15.45 16.37 17.28
Total Debt to Total Assets 23.74% 18.53% 13.84% 9.67% 5.99% 2.78%
Pre-tax Return on Net Worth 19.66% 18.47% 17.45% 16.56% 15.79% 15.11%
Pre-tax Return on Assets 13.98% 14.13% 14.19% 14.19% 14.14% 14.04%
Business Vitality Profile

Revenue per Tenant $5,029 $5,280 $5,544 $5,821 $6,112 $6,418

125
Period Construct Full Capacity
Year 2021-25 2026 2021-25 2026 2021-25 2026 2021-25 2026 2021-25 2026
Additional Ratios
Net Profit Margin 34.19% 35.73% 38.13% 40.38% 42.49% 44.46% 46.30% 48.03% 49.64%
Return on Equity 57.39% 38.64% 30.22% 25.15% 21.74% 19.28% 17.42% 15.94% 14.75%
Activity Ratios
Accounts Receivable Turnover 92.72 92.75 92.78 92.81 92.84 92.86 92.89 92.91 92.93
Collection Days 30 30 30 30 30 30 30 30 30
Inventory Turnover 1.38 1.38 1.38 1.38 1.38 1.38 1.38 1.38 1.38
Accounts Payable Turnover 1.20 1.20 1.20 1.20 1.20 1.20 1.20 1.20 1.20
Payment Days 30 30 30 30 30 30 30 30 30
Total Assets Turnover 0.17 0.18 0.19 0.19 0.19 0.20 0.20 0.20 0.19
Fixed Assets Turnover 0.003 0.003 0.003 0.004 0.004 0.004 0.005 0.005 0.005
Debt Ratios
Debt to Net Worth 8.06 4.63 3.00 2.07 1.49 1.09 0.81 0.61 0.45
Current Liability to Liability 0.03 0.03 0.04 0.05 0.06 0.07 0.09 0.11 0.13
Debt-Service Coverage Ratio 1.33 1.37 1.47 1.58 1.71 1.84 1.99 2.15 2.32
Liquidity Ratios
Net Working Capital $2,993,177 $2,969,363 $2,970,204 $2,975,420 $2,985,231 $2,999,865 $3,019,565 $3,044,582 $3,075,184
Interest Coverage [Times Interest Earned Ratio – TIE] 5.14 5.77 6.52 7.42 8.50 9.82 11.45 13.53 16.23
Additional Ratios
Assets to Revenue 5.73 5.53 5.36 5.24 5.16 5.11 5.10 5.12 5.16
Current Debt / Total Assets 3.35% 3.10% 2.82% 2.54% 2.25% 1.97% 1.69% 1.43% 1.18%
Acid Test 7.71 8.28 8.71 9.26 9.90 10.60 11.35 12.14 12.96
Sales/Net Worth 1.68 1.08 0.79 0.62 0.51 0.43 0.38 0.33 0.30

126
Year 2035 2036 2037 2038 2039 2040
Additional Ratios
Net Profit Margin 51.14% 52.55% 53.86% 55.09% 56.23% 57.30%
Return on Equity 13.76% 12.93% 12.21% 11.60% 11.05% 10.58%
Activity Ratios
Accounts Receivable Turnover 92.96 92.98 93.00 93.01 93.03 93.05
Collection Days 30 30 30 30 30 30
Inventory Turnover 1.38 1.38 1.38 1.38 1.38 1.38
Accounts Payable Turnover 1.20 1.20 1.20 1.20 1.20 1.20
Payment Days 30 30 30 30 30 30
Total Assets Turnover 0.19 0.19 0.18 0.18 0.18 0.17
Fixed Assets Turnover 0.006 0.006 0.006 0.007 0.007 0.008
Debt Ratios
Debt to Net Worth 0.33 0.24 0.17 0.11 0.07 0.03
Current Liability to Liability 0.17 0.22 0.30 0.42 0.68 1.46
Debt-Service Coverage Ratio 2.52 2.73 2.96 3.22 3.51 3.83
Liquidity Ratios
Net Working Capital $3,111,650 $3,154,272 $3,203,358 $3,259,233 $3,322,234 $3,392,718
Interest Coverage [Times Interest Earned Ratio – TIE] 19.89 25.06 32.89 46.04 72.52 152.29
Additional Ratios
Assets to Revenue 5.23 5.31 5.42 5.54 5.68 5.83
Current Debt / Total Assets 0.95% 0.74% 0.55% 0.39% 0.24% 0.11%
Acid Test 13.79 13.59 14.52 15.45 16.37 17.28
Sales/Net Worth 0.27 0.25 0.23 0.21 0.20 0.18

127
Schedule 13: Projected Payback Period (In US$)
YEAR/ITEM 2026 2027 2028 2029 2030 2031 2032 2033 2034
Net Profit 55,408,487 60,797,725 68,133,336 75,762,928 83,701,200 91,963,585 100,566,289 109,526,328 118,861,570
Interest 31,108,440 29,150,000 27,040,000 24,960,000 22,880,000 20,800,000 18,750,000 16,640,000 14,560,000
Depreciation 21,135,930 21,135,930 21,135,930 21,135,930 21,135,930 21,135,930 21,135,930 21,135,930 21,135,930
"Profit" 107,652,857 111,053,655 116,309,266 121,858,858 127,717,130 133,899,515 140,422,219 147,302,258 154,557,500
Year Amount Balance of Balance of

paid Loan Equity
back from Investment Investment
"profits"
1 0 -777,711,000 -21,924,000
2 107,652,857 -670,058,143 85,728,857
3 116,309,266 -553,748,876 202,038,124
4 121,858,858 -431,890,018 323,896,982
5 127,717,130 -304,172,888 451,614,112
6 133,899,515 -170,273,374 585,513,626
7 140,422,219 -29,851,155 725,935,845
8 147,302,258 117,451,104 873,238,104
9 154,557,500 272,008,603 1,027,795,603
10 162,206,703 434,215,307 1,190,002,307
Pay Back Period = 7.20 YEARS
Equity Pay Back = 1.26 YEARS

128
Schedule 13: Projected Payback Period (In US$)….continued
YEAR/ITEM 2035 2036 2037 2038 2039 2040
Net Profit 128,590,773 138,733,637 149,310,844 160,344,111 171,856,241 183,871,179

Interest 12,480,000 10,400,000 8,350,000 6,240,000 4,160,000 2,080,000
Depreciation 21,135,930 21,135,930 21,135,930 21,135,930 21,135,930 21,135,930
"Profit" 162,206,703 170,269,567 178,766,774 187,720,041 197,152,171 207,087,109
Year Amount paid Balance of Loan Balance of

Equity
back from Investment Investment
"profits"
1 0 -777,711,000 -21,924,000
2 107,652,857 -670,058,143 85,728,857
3 116,309,266 -553,748,876 202,038,124
4 121,858,858 -431,890,018 323,896,982
5 127,717,130 -304,172,888 451,614,112
6 133,899,515 -170,273,374 585,513,626
7 140,422,219 -29,851,155 725,935,845
8 147,302,258 117,451,104 873,238,104
9 154,557,500 272,008,603 1,027,795,603
10 162,206,703 434,215,307 1,190,002,307
Pay Back Period = 7.20 YEARS
Equity Pay Back = 1.26 YEARS

129
ANNEX I: MUTUKULA REGIONAL MARKET LAUNCH PICTORIAL
Heads of the East African Community (EAC) & COMESA During

the Launch of the Mutukula Regional Market on 12th July, 2019

130
Mutukula One Stop Border Post

131

MRML Business Plan 06.05.2021

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BUSINESS PLAN

REGIONAL MARKET & LOGISTICS HUB

ON THE UGANDA-TANZANIA BORDER

MUTUKULA REGIONAL MARKET LIMITED

MUTUKULA REGIONAL MARKET LIMITED

S/NO. DESCRIPTION PAGE

1.0 EXECUTIVE SUMMARY 1

2.0 BACKGROUND AND PROJECT CONCEPT 9

MRML REGIONAL CONCEPT & DESCRIPTION OF TRADE, INDUSTRY

Business Plan Corporate Document

5.0 LEGAL AND REGULATORY REVIEW 43

6.0 MARKET OPERATIONS, DESIGN & CONSTRUCTION 45

7.0 START-UP OPERATION REQUIREMENTS AND PROCEDURES 53

8.0 ENVISAGED INSTITUTIONAL AND OPERATING ARRANGEMENTS 55

9.0 OPERATING COSTS ESTIMATES AND JUSTIFICATIONS 70

Business Plan Corporate Document

11.0 IMPLEMENTATION SCHEDULE 83

12.0 MONITORING MARKET DEVELOPMENT AND IMPACT 85

13.0 PROJECT BENEFICIAL IMPACTS 87

Business Plan Corporate Document

T/NO. DESCRIPTION PAGE

1 Key Project Performance Parameters 6

2 Estimated Project Cost 21

5 Market Levy Fees 41

6 The Company Shareholders 43

7 Required Licenses, Approvals and Consents 44

12 Break-Even Analysis in Project Year 5 77

13 Initial Project Investment Cost 78

14 Annual Production Cost at 100% Capacity 79

15 Change in CAPEX Cost 81

16 Change in Rates/Square Metre and Fee 82

17 Change in Direct Expenses 82

18 Monitoring and Evaluation Impact Indicators 86

19 Key Financial Modeling Assumptions 97

Business Plan Corporate Document

F/NO. DESCRIPTION PAGE

1 Projected Financial Performance Highlights 6

4 Site Plan for the Project 22

5 Proposed Rutepi 5-Star Hotel 30

6 Proposed Rutepi 5-Star Hotel 30

7 Market Design and Development Process 46

8 MRML Organizational Structure 56

9 Chart Showing Project Team Structure 67

10 Project Implementation Schedule 84

11 East African Heads of State at a Previous Summit Meeting 92

Business Plan Corporate Document

S/NO. DESCRIPTION PAGE

01: Key Financial Modeling Assumptions 97

02/1: Project Budget 100

02/2: Source and Structure of Project Financing 102

03: Loan and Interest Service Schedule 103

04/2: Calculation of Working Capital: II Consolidated Annual Income Estimates 105

04/4: Calculation of Working Capital: IV Working Capital Requirements 109

05: Fixed Assets and Depreciation Allowances 111

06: Change in Total Investment Costs 113

07: Change in Total Assets 114

08: Projected Cash Flow Table 116

10: Projected Income Statement 120

11: Projected Balance Sheet 122

12: Business Ratios/Ratio Analysis 124

13: Projected Payback Period 128

Business Plan Corporate Document

S/NO. DESCRIPTION PAGE