31 August 2010
An immigrant from Uganda now residing in Chicago has used the first portion of a $100,000 business competition prize he won in January to begin setting up an operation in his homeland to produce and distribute ovens that cook with the heat of the sun.
Ron Mutebi won his $100,000 prize at the African Diaspora Marketplace competition in Washington in January. The competition, sponsored by Western Union Company and the U.S. Agency for International Development (USAID), provided awards of $50,000 to $100,000 to 14 winners. All of them are Africans residing in the United States who had submitted proposals to establish or expand businesses in their home countries with local partners.
After Western Union disbursed $60,000 of the prize money in May, Mutebi arranged to ship from Chicago the components for 365 solar ovens and tools to assemble them in July. The shipment is scheduled to arrive in Uganda in October. In November, Mutebi will travel to Uganda to oversee the completion of an assembly plant and the training of staff to produce, distribute and service the cookers, made by Sun Ovens International in Elgin, Illinois. The ovens will appear in Ugandan markets in January 2011, according to Mutebi.
Mutebi has already compiled a list of nearly 1,000 people who want to buy one of the ovens, which he said will be sold for $170 each.
"We know the payoff is going to be there. It will be big when it happens," Mutebi said. "There is no other technology that can have such an impact on environmental degradation and global warming in a practical sense."
After acquiring solar ovens, villagers will not have to spend their meager incomes to buy firewood or charcoal, the prime sources of cooking fuel in Uganda, Mutebi said. The use of firewood and charcoal has caused widespread deforestation in Uganda.
Mutebi will arrange a second shipment of oven parts when he receives the rest of the prize money, which he expects to be in November.
The Chicago-based businessman said that as Ugandan companies start to provide locally made components over the next two years, he expects the cost of the ovens to come down to about $100, a 41 percent drop in price but still a substantial sum for many Ugandans, whose per capita income is $1,200 per year.
His biggest challenge to growing the business, he said, is the high interest rates that Ugandan banks charge for consumer loans -- around 24 percent. Mutebi said he is looking for ways to allow oven purchasers to buy on installment. "We can't run a business sustainably the way we want to because of the lack of support from financial institutions," he said.
Mutebi also is looking at nonmonetary methods for villagers to buy an oven.
For example, as Mutebi explains it, a Ugandan farmer may plant fruit trees on his land in exchange for an oven. The trees would be Mutebi's property. The farmer and his family would be free to consume the fruit, but Mutebi would have rights to harvest and sell the surplus. This way, he said, "the ovens not only will stop deforestation but also will promote planting of new trees. Farmers will have an economic incentive to do this."
Since winning the prize, Mutebi has spoken on frequent occasions about entrepreneurship in Africa. He was a featured speaker at the Africa Infrastructure Conference, sponsored by the Corporate Council on Africa in April in Washington, and at President Obama's Forum with Young African Leaders in August.
"I am blessed to have this opportunity to bring solar ovens to my people. I'm helping alleviate poverty and global warming and make a profit at the same time," Mutebi said.