Tuesday, November 13, 2018
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Govt Approves Shs960bn Borrowing As Public Debt Nears Shs50Trn Mark

Uganda’s Cabinet Monday approved the proposal to borrow up to US$251 million (Shs960bn) in order to extend safe water to refugee communities.

The revelation was made by Cabinet Spokesperson, Frank Tumwebaze while briefing the media about yesterday’s Cabinet resolutions.

The money will borrow through Ministry of Finance from World Bank to help areas with refugees improve sanitation, he said.

“The amount to be borrowed will provide safe water sanitation services in the project areas of Gulu municipality, Adjumani Town Council, Pakele, Ciforo & Dzaipi, Busia Town Council, Namungalwe-Kaliro,” he said.

Other areas to benefit from the loan include Kyegegwa-Mpara-Ruyonza, Namasale, Mbale Municipality, Butaleja-Busolwe and Budaka-Kadama-Trinyi-Kibuku.

He added that the money will also strengthen the National Water Resource Monitoring & Information System.

Uganda’s public debt hit USD10.53 billion (about Shs40.4 trillion) as at March 2018.  External debt comprised USD7.18 billion (aboutShs27.58 trillion), while domestic debt stood at USD3.35 billion (Shs12.8 trillion). The government has since been borrowing and the figure is expected to be nearing the Shs50 trillion- mark.

It should be noted that on September13, 2018, Kumi Municipality MP, Silas Aogon lost his cool over Government of Uganda’s high appetite for loans, wondering whether this vice is sustainable.

The lawmaker made the remarks during the plenary sitting, where he raised a procedural issue on whether it was right for Government to keep furnishing Parliament with loan requests.

“Is it procedurally right for Government to make it usual and daily business to borrow, are you not going to scare citizens of this country? Aogon asked.

Aogon’s question came after the State Minister for Planning, David Bahati  tabled a motion for a Resolution of Parliament to authorize Government to borrow up to USD200 Million from the International Development Association of the World Bank Group to Support the Uganda Inter-governmental Fiscal Transfers Program for results.

Earlier in the week, the Government had sought to borrow up to USD45m from the Islamic Development Bank to support the technical and vocational education and training support project.

There was also a request by government to borrow up to USD33m from Islamic Development Bank to support the local economic growth support project.

Additionally, Government tabled another motion to borrow up to Euro40M from Kreditanstalt Fur Wiederaufbau (kfw), the German Development Bank to finance the Gulu-Agago transmission line project.

However, Bahati defended the loans, reminding Parliament that the 2018/2019 budget that was passed had two side sources of revenue and expenditure, where loans and grants were part of the budget.

“Every single loan comes here for approval, so when we come here, we are not adding on what you approved, but we are approving individually, you are going to bear with us because this isn’t the last time, even Tuesday we are coming,” Bahati assured the MPs.

 

 

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