Finance Minister Matia Kasaija
The Government of Uganda has guaranteed eight projects worth Shs9.5 trillion under the Public-Private Partnership (PPP) contracts arrangement.
This revelation is contained in Finance Ministry’s contingent liabilities annual field report for 2019/2020 that was released in March 2021 but only uploaded online recently.
As at end November 2020, there were 8 Public-Private Partnerships (PPPs) on-going projects under the PPP Act 2015.
All these projects were in their preliminary stages, and the Government was not exposed to any ascertainable financial exposure resulting from their operation.
“There were therefore no contingent liabilities arising from the reported PPPs,” the report says.
The first project registered under the Public-Private Partnership was Kampala – Jinja Expressway Unit that entails the construction of a tolled expressway between Kampala and Jinja.
The Uganda National Roads Authority (UNRA) will be seeking bids from
the private sector for this project after the feasibility study carried out by International Financial Corporation (IFC) was approved by the PPP Committee in December 2017.
The project is estimated to cost USD 1.5 billion approximately Shs5.332Trn with the GoU contributing a viability gap funding of approximately USD400 million about Shs1.421Trn while the remaining funding portion shall jointly be provided by the European Union, AFD and African Development Bank.
Maris Wanyera Acting Director, Directorate of Debt and Cash Policy at Ministry of Finance wrote in the report that the project was previously on hold
pending Cabinet decisions, but has since been granted a conditional way forward to proceed.
“In light of the above, the project team has resumed review of project status and the implications arising from the Covid-19 pandemic,” Wanyera said.
The other project is the Kampala Waste Management involving the building and operating of a new sanitary landfill and waste treatment facility at Dundu in the Mukono district, and the building and operating of a waste transfer station at Kiteezi in the Wakiso
District.
According to Ministry of Finance, Kampala Capital City Authority (KCCA) will be seeking bids from the private sector for the project, estimated to cost USD163 million about Shs579.461Bn and a feasibility study was carried out by the International Finance Corporation (IFC). The Feasibility Study Report is currently under review at the PPP Unit.
Government is in plans to establish and Information, Communication and Technology (ICT) Park that entails the construction of a 17-acre ICT Park in Entebbe at an estimated cost of USD150 million equivalent to Shs532.952Bn.
To be overseen by National Information Technology Authority (NITA-U), the Authority is currently seeking bids towards securing the support infrastructure for the project and this undertaking is currently at the preparation of a feasibility study.
Another project eyed by Government is the redevelopment of National Council of Sports Complex – Lugogo, a Project comprising of the redevelopment of the existing sports facilities and construction of new sports facilities, a health club, shopping centres, restaurants.
The estimated project cost is USD19 million approximately Shs67.542Bn. Currently, NCS is currently in the process of procuring the services of a transaction advisor to support management in carrying out a detailed feasibility study report and procurement of a private party to implement the project.
The other project in the pipeline is the re-development of Uganda National Cultural Centre (UNCC) Properties which project comprises of the redevelopment of UNCC’s prime property, located at
the National Theatre and Nommo Gallery.
Wanyera Acting Director, Directorate of Debt and Cash Policy at Ministry of Finance said that this property has to be developed into an ultra-modern cultural centre with three theatres, resource centre, crafts centre, recreation centre, art gallery, office space and a 5-star hotel, estimated to cost USD174.3 million about Shs620.785Bn.
Currently, the procurement of the transaction advisory services is said to be at the bid evaluation stage.
The sixth project in this PPP pool is the Mulago National Referral Car Parking project aimed at developing a modern car parking facility for Mulago Hospital at an estimated cost of USD19.1 million equivalent to Shs67.510Bn. However, the project is currently on hold until funding is secured to finance the feasibility study.
Gulu Logistics Hub is the seventh project in this basket that will see Government construct a Logistics Hub in Gulu on land belonging to the Uganda Railways Corporation (URC). The project is funded by EU and Trademark East Africa for the procurement of transaction advisory services, and
a grant towards the construction phase of the project.
The PPP is for the operation and maintenance of the project assets that will be constructed at an estimated cost of USD21 million equivalent to Shs74.793Bn the project was recently accepted for registration.
The last project is the Uganda Rural Water Development Project proposed to develop large diameter ground water wells in stressed parts of the country in conjunction with the Ministry of Water and Environment (MWE) with the help of a private party- Hydro Nota
Ltd in a Public Private Partnership (PPP).
The PPP is estimated to cost approximately USD650 million about Shs2.315Trn and will be used towards designing, building, financing, operating
and transferring (DBFOT) of the wells and associated infrastructure. The project is currently undergoing evaluation of the project agreement by PPP Unit.
Worth noting is the fact that, Government had entered into other PPP projects before the enactment of the PPP Act 2015; the Bujagali
Hydropower Generation project, Eskom Generation Concession, Umeme Power Distribution Concession, Kalangala Infrastructure Services, Kampala Serena Hotel, and Kilembe Copper Mine
Concession.
Ministry of Finance is mandated under Articles 42(2) of the Public Finance Management Act (PFMA 2015), by 1st April, to prepare and submit to Parliament a detailed report of the preceding financial year, on the management of the public debt, guarantees and the other financial liabilities of Government.
Contingent liabilities are a major source of fiscal risk for sovereigns which makes monitoring and managing them very important in averting any potential financial losses or unplanned expenditure by the Government. Within this decade, several countries have faced fiscal crises arising from the Contingent Liabilities report is important in predicting financial exposure and liabilities that government may be faced with so as to avert fiscal risks which is a good practice in public financial management.
