Matia Kasaija, the Minister of Finance
The Ministry of Finance has tabled before Parliament a motion seeking Parliamentary approval to borrow Shs2.446Trn from World Bank and Islamic Development Bank for the construction of roads and promotion of smart agriculture in Uganda.
The loan request was recently tabled by Matia Kasaija, the Minister of Finance in which Government seeks to borrow US$295 million (Shs1.110Trn) from the Islamic Development Bank and US$30 million (Shs112.905Bn) from the OPEC Fund for international development for the up grading of national roads project in Uganda, thus amounting to Shs1.219Trn.
Government is also seeking to borrow up to US$325 million (Shs1.223Trn) and receive a grant of up to US$25 million (Shs93.601Bn) from the International Development Association (IDA) of the World Bank Group to finance the Uganda Climate Smart Agricultural Transformation Project (UCSATP), thus bringing to Shs2.446Trn the loan request.
Plans by Government to borrow from World Bank comes at the time the international lender in August 2023 threatened to withhold funding any new projects in Uganda following the passing into law the Anti-Homosexuality Act on grounds that the controversial legislation fundamentally contradicts the Bank’s values, and in order for World Bank to achieve its vision of eradicating poverty on a liveable planet, this can only succeed if it includes everyone irrespective of race, gender, or sexuality and the Anti-Homosexuality Act 2023 undermines those efforts.
If the World Bank loan is approved by Parliament, this will be the second loan Government is seeking from UNRA, following the August 2023 pronouncement by the international lender, after an earlier loan to fund construction of roads within Kampala Metropolitan area was approved recently.
The latest loans will adversely affect Uganda’s debt burden after the Ministry of Finance recently revealed that Uganda’s public debt has now hit the Shs87Trn mark, with the report highlighting that the total public debt stock increased from US$20.97Bn (Shs78.495Trn) as at June 2022 to US$23.22Bn (Shs86.918Trn) as at the end June 2023.
Details are contained in the Debt Statistical Bulletin and Public Debt Portfolio Analysis for June 2023 under the Directorate of Debt and Cash Policy by the Ministry of Finance, Planning and Economic Development.
