Micro scale irrigation
Parliament is set to debate the approval of UGX734bn loan to boost solar powered irrigation in Uganda
Uganda’s 12th Parliament is slated to hold its plenary sitting tomorrow afternoon in which the Ministry of Finance is expected to table a loan request seeking authorisation of Parliament to borrow up to Euro 168,976,354 (UGX734,078,905,391) from the UK Export Finance (UKEF) and Citi Bank for the development of solar powered irrigation systems project phase II.
The development comes at the time when a scrutiny conducted by Parliament Watch in May 2026, through Hansards, revealed that between October 2022 to December 2025, the 11th Parliament approved loans worth UGX44.581Trn.
The election year 2025 accounted for the highest value of loans approved (UGX28.157Trn), while 2021 recorded the lowest value of approved loans at UGX1.254Trn.
In a single sitting held in December 2025, Parliament approved four loans valued at UGX10.048Trn.
According to the Quarterly Debt Statistical Bulletin and Public Debt Portfolio Analysis report for December 2025, Uganda’s total public debt stock increased to US$34.86Billion (UGX131.505Trn) by the end of December 2025, up from US$34.21 billion at the end of September 2025. Domestic debt accounted for 54.5% of this total debt equivalent to US$19.02 billion or UGX68.86trillion, while external debt made up 45.3% equivalent to USD 15.84 billion or UGX57.33 trillion.
There have been growing concerns over Uganda’s ballooning debt, with questions raised on its sustainability.
Uganda’s rising public debt has become a key concern for policymakers and investors, particularly as the government plans UGX 28 trillion in new borrowing for FY 2026/27, bringing total debt close to 55 percent of GDP, according to the Bank of Uganda.
While the Charter of Fiscal Responsibility legally limits debt to 50 percent of GDP, Uganda is already edging past this threshold, raising questions about the sustainability of future borrowing, the risk of crowding out private credit, and potential pressure on fiscal buffers.
Uganda’s debt ratio is moderate compared to Kenya and Ethiopia, but higher than Tanzania and approaching Rwanda’s level.
Unlike Kenya and Ethiopia, Uganda’s debt is increasingly dominated by domestic borrowing, which could strain the local banking sector and raise interest rates
