On Labour Day, May 1, 1970, in what came to be termed as the “Nakivubo Declaration”, President Milton Obote announced that the government was going to nationalise the economy.
As a result, large companies like UBL were targeted for what was effectively a government takeover
It should be noted that although the government now had a 60% stake in the major companies, that percentage was only in the final profits. The day-to-day management of these companies was left in the hands of the managers who had been running these companies.
The partially nationalised companies however, found a way to under declare their profits and ultimately the government did not gain as much of the profits as they had hoped.
Following the expulsion of the 40,000 non-citizen Asians in September 1972, scarcity of commodities such as salt, sugar and beer, that had previously been in plenty on the market began to be felt.
The same year, UBL embarked on an extension of 1. 5 million Uganda shillings (about $200,000 at the official exchange rate of the time). With this extension, expected to be complete by the end of 1972, production at the plant was projected to increase from 110,000 cases of beer per month to 185,000.
Following the breakdown of relations between the Uganda government and the West and the steady trend toward strident nationalism, Hunter, a white Managing Director left Uganda for Nairobi in 1974 where he re-joined EABL.
Juuko was then named Managing Director, becoming the first Ugandan to head UBL. Makai became the head brewer.
Two years later, Juuko left the company and was replaced by a Hajji Fadimula, a businessman and close associate of President Amin. Fadimula would remain in charge of the company until the fall in 1979 of the Amin government.
On May 5, 1976, Radio Uganda announced that the government was to take over a number of companies including Uganda Breweries. The government took full control of Uganda Breweries, running the company more or less like an extension of the civil service.
This was the most serious blow to the company since the 60% stake in business corporations first announced by the government in 1970.
An unexpected increase in world coffee prices in 1977 brought Uganda its first budget surplus in years and with that a brief period of economic growth and increased disposable income for the population. There was a corresponding rise in the consumption of beer and other commodities.
However, this increase in national prosperity was reversed with the collapse in July 1977 of the East African Community. It thus became difficult for industrial machinery to be imported via Mombasa, affecting the beer industry as a result.
To add insult to an injury, on December 28, 1977, the government announced a freeze on the allocation of foreign exchange to businesses wishing to import manufacturing inputs and spare parts.
The collapse of the East African Community and the curb on foreign exchange allocations weakened the Ugandan beer market by the end of that year.
The most serious damage to the Ugandan economy came with the 1979Uganda-Tanzania war. In Kampala, Entebbe and Jinja widespread looting followed the fall of the Idi Amin government.
At this time in 1979 and 1980 following the fall of the Amin government, the Managing Director of Uganda Breweries was Daniel Kigozi. Kigozi had been an engineer with East African Breweries in Nairobi.
Throughout the 1970s, East African Breweries never totally gave up its interest in Uganda Breweries despite the nationalisation of the company in 1970.