JUST IN : Gov’t revises irrigational request downwards by UGX 26 billion

JUST IN : Gov’t revises irrigational request downwards by UGX 26 billion
Ministry of Finance Planning and Economic Developement

KAARO KARUNGI | KAMPALA –  The Ministry of Finance has revised a loan request first made in 2019 from 445 to 419 billion shillings. 

Parliament had authorized the government to borrow up to 445 billion Shillings (101.88 million euros) from the UK Export Finance for the development of solar-powered irrigation and water supply system across the country. The project seeks to develop 920 water supply systems for both domestic use and irrigation nationwide over a three-year period.

The project was also expected to establish small-scale irrigation schemes for the rural areas and urban and rural water supply systems for domestic use. For it to take shape, the government was expected to provide counterpart funding of 11.34 per cent of the total financing. 

However the Minister of Finance in charge of planning David Bahati says that following further discussions and reviews of the project with the creditor and the Ministry of Water and Environment, a decision was taken to reduce the loan request. He says that the move will help reduce Uganda’s loan and debt burden by 26.8 billion Shillings.

MPs approved the amendment but questioned regional balance in the approval of such projects. Many of them had earlier indicated that many regions in Uganda have faced dire situations of drought and have often failed to access water to support agriculture that is a major source of livelihood, as well as water for basic human survival.

Cyrus Aogon, the Kumi Municipality MP says that regions like Teso have been continuously left out, yet it is a dry area that does not often get rain. However, Abraham Byandala, the Katikamu North MP says that it is unfortunate that Government still continues to borrow and yet most of it is going to wastage.

As of June 2020, Uganda’s public debt was 56.5 trillion shillings according to the Bank of Uganda (BoU). Two-thirds of the debt is held by external creditors, while public debt  is  40.8 per cent of GDP




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