A COST-BENEFIT ANALYSIS OF LOCAL PRODUCTION OF READY TO USE THERAUPETIC FOODS IN UGANDA

The prevalence of malnutrition, vitamin-A deficiency, and anemia is high in Uganda. Of children under 5 years of age, 33 percent are stunted and 5 percent wasted. The rate of anemia among women and children is as high as 50 percent. The aim of this study is to identify if a 5 year off-take contract would result a sufficient incentive for the private sector to establish a factory for Ready to Use Therapeutic Food (RUTF) production. The base-line analysis revealed that the financial incentive for the investment would exist if the off-take price is at the RUTF’s world price level. The proper structure of the deal would also result on significant benefits arising to more than 4,000 HIV/AIDs infected farmers supplying pea nuts to the factory. The government of Uganda would also benefit by US$1.54 mill over the 10-year life of the project