Minister of Finance, Matia Kasaija
Parliament has approved a government proposal to borrow EURO 500 million (about UShs2 trillion) to finance the 2024/25 budget that is one month away from ending.
The loan request was tabled by Minister of Finance, Matia Kasaija during parliament’s plenary session that marked the end of the fourth year of parliament.
Kasaija said Government will borrow up to EURO 270 million from African Export-Import Bank (AFREXIM Bank) and up to EURO 230 million from Ecobank Uganda Limited and Development Bank of Southern Africa Limited to “finance ted to Government of Uganda budget for 2024/25.”
The Minister indicated that the money is urgently needed to settle key infrastructural development works for especially roads.
Kasaija informed Parliament that the two loans were approved by the President on 20th May 2025 and Cabinet on 26th May 2025. He said a Certificate of Financial Implication had been secured.
On terms of the AFREXIM loan, Kasaija said “the all-in cost-effective interest rate for the facility is 7.33% based on the 6-month Euribor Rate of 2.151% as of 7th May 2025” while “the all-in cost-effective interest rate for the two Eco Bank facilities is7.28% for the DFI tranche and 7.18% for the Commercial tranche based on the 6-month Euribor Rate of 2.151% as of May 2025.”
However, a section of MPs questioned the urgency of such a commercial loan.
This comes amid Uganda’s rising debt. In a report on Public Debt and Grants laid in Parliament on March 27th 2025, Uganda’s total Public Debt stood at Shs 106.22 trillion as at December 2024. This is 52.4% of the GDP which was given as Shs 202.7 trillion in the Budget Framework Paper.
