Parliament has approved government’s request to borrow Shs 140.6 billion from the African Development Bank (AfDB) and Shs 151.7 billion from African Development Fund (ADF) for upgrading Kapchorwa- Suam- Kitale road and Eldoret bypass roads.
Early in 2010, both Uganda and Kenya sought to upgrade that corridor, seeking funds from the World Bank and Danish International Development Agency (DANIDA), however, the request was not granted.
Despite the failure to meet required standards, both governments did not relent; in 2014 they embarked on getting funds from ADB and ADF to develop the road corridor to enhance trade in the region.
The ADB loan is expected to be paid in 25 years including eight years grace period, while the ADF loan is expected to be cleared in a period of 40 years including a 10-year grace period.
In a report compiled by committee of national economy headed by Nakaseke North MP Syda Bbumba Namirembe, it was recommended that the country borrows to finance the Kapchorwa – Eldoret road project.
‘The Ministry of East Africa Affairs should represent Uganda in the joint committee and coordinates regional projects since it is a multi-sectoral and multinational project,’ part of the committee report states.
Currently, Uganda’s external debt stands at US$5.2 billion, contributing 50.2 per cent of the total nominal public debt, while domestic debt stands at US$3.4 billion.