Uganda's President Yoweri Museveni will allow 7,100 hectares of virgin forest to be farmed for sugarcane, his spokesperson told Reuters on Monday, potentially triggering a repeat of protests that stopped a similar deal in 2007.

Tamale Mirundi said President Yoweri Museveni plans to let Sugar Corporation of Uganda Limited (SCOUL), owned by the Ugandan state and Indian private investors, farm part of Mabira Forest to ease a sugar shortage of about 40,000 tonnes.

Cutting down the forest will expose Lake Victoria to silting, disrupt rainfall patterns in the region and put agricultural activity at risk, conservationists say. A hectare is about the area of a maximum-size football pitch.

Mabira, 30,000 hectares of virgin forest between the capital Kampala and the source of the Nile at Jinja, is a popular tourist attraction and is home to a range of species including rare monkeys, birds, butterflies and medicinal shrubs.

In April 2007 three people were killed and dozens injured in demonstrations against plans to give part of Mabira to SCOUL.

"Environmentalists in Uganda are teaming up with the opposition and getting funding to disrupt development and the President wont allow that, he intends to give away that forest," Mirundi said.

"The part of the forest that he wants to give away has been degraded already and can't be salvaged."

The latest plan is certain to anger environmentalists who thought they had permanently stopped the plans in 2007.

Frank Muramuzi, a leader of the "Save Mabira Committee", the organisation that spearheaded the 2007 demonstrations, said meetings had already begun to stop the new plan.

"The President is daydreaming, we're now even more determined and the country is going to be more united in its opposition to destroying Mabira, so he should forget it," Muramuzi said.

Uganda, which is east Africa's third largest economy has been hit by a spate of economic protests since April, triggered by sky-high commodity prices.