Uganda Seeks Shs843 Billion Loan for Jinja-Bukungu Road Upgrade

The Ugandan government has approached Parliament to secure a substantial loan of approximately Shs843 billion (about €207.77 million) from international financial institutions, including Citi Bank. The funds are earmarked for a critical road infrastructure project aimed at upgrading the Jinja–Bukungu road corridor and urban roads within Jinja City, covering a total of 137 kilometers.

Minister of State for Finance, Henry Musasizi, presented the loan request to the Parliamentary Committee on National Economy, accompanied by the Minister of State for Works and Transport, Fred Byamukama. Musasizi highlighted the project’s economic viability, citing an Economic Internal Rate of Return (EIRR) of 16.7%, which significantly surpasses the 11% economic opportunity cost of capital.

Of the total loan, €179.26 million will be allocated to civil works and commercial insurance. The remaining €28.51 million is designated for land acquisition compensation and construction supervision, ensuring a comprehensive approach to the upgrade.

Minister Musasizi reassured lawmakers that the proposed borrowing aligns with Uganda’s national debt management strategies and is integrated into the country’s fiscal framework for the current and medium-term budgets. The project is expected to enhance connectivity across the Busoga sub-region, facilitating the smoother movement of goods and people, and establishing a vital alternative transport link between northern and southern Uganda.

The Parliamentary Committee on National Economy is set to thoroughly review the loan terms before presenting its findings and recommendations to the full Parliament for a final decision.

Source: Nile Post