Parliament Approves $566 Million Loan for Greater Kampala Metropolitan Area Development

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Parliament has approved a loan of $566 million from the World Bank’s International Development Association for the Greater Kampala Metropolitan Area Urban Development Program. Additionally, a loan from the Agence Francaise de Development will further support the program. There’s emphasis on efficient use of funds, unity in administration, and experienced project contractors for successful execution.

Parliament has given Government the green light to obtain a loan of up to US$566 million (Shs 2.1 trillion) from the International Development Association (IDA) of the World Bank Group.

The Greater Kampala Metropolitan Area Urban Development Programme (GKMA-UDP) will be funded by the loan.

In Kampala, Entebbe, Kira, Makindye-Ssabagabo, Mukono, and Nansana municipalities as well as Mukono, Mpigi, and Wakiso district local governments, the program will promote the construction of infrastructure, particularly roads.

Out of the total, US$518 million will be borrowed and US$48 million will be granted. Thomas Tayebwa, the deputy speaker, gave the finance minister the responsibility of determining if the loan is one that is impacted by the World Bank’s recent decision to stop lending to Uganda.

“We reviewed the World Bank’s statement, and before putting this on the order paper, I evaluated and made a decision. But before we move further, we need assurance that this is not one of the impacted projects,” instructed Tayebwa.

Hon. Henry Musasizi, the state minister for Finance, soothed his colleagues by stating that the loan was legitimate because the World Bank Board had already approved the project on May 31, 2022.

“The Greater Kampala Metropolitan Area Project is not one among the projects impacted by the World Bank statement, I want to assure this House. Therefore, it is appropriate that we think about the initiative and handle it so that the Executive may start putting it into practice, said Musasizi.

Tayebwa noted that while the statement only applied to new projects, all previously authorized World Bank projects would be brought before Parliament for consideration.

A loan from the Agence Francaise de Development (AFD) in the amount of US$42.66 million (Shs156.4 billion) will help the program even more.

Hon. Robert Migadde, the Deputy Chairperson of the Committee on National Economy, offered suggestions for the efficient use of project funding.

He claimed that for KCCA and the eight local governments in the Greater Kampala Metropolitan Area to receive value for money, they must be audited to ensure that services are offered at reasonable unit rates and in a timely manner.

Additionally, he advised the Finance Ministry and Kampala Capital City to make sure loan effectiveness requirements are timely met.

According to Migadde, this will cause credit to be disbursed on schedule so that program objectives can be achieved as expected.

Regarding the program’s implementation in the Greater Kampala Metropolitan Area, where Kampala’s administration is distinct from that of the other local governments, Hon. Betty Nambooze (NUP, Mukono Municipality) raised worry.

The provisions of Chapter 11 of our Constitution have always presented obstacles when this House has attempted to devise a framework that could bring this region under one organization for proper planning and administration of operations, according to Nambooze.

To ensure smooth operations amongst the administrative units, she suggested that unity be controlled at the ministerial level.

An inter-ministerial committee of Local Government and Kampala, according to Hon. Cecilia Ogwal (FDC, Dokolo District Woman Representative), would ensure efficient implementation.

Tayebwa noted, however, that the government may simply incorporate the program’s implementation in the Greater Kampala Metropolitan Area using the programme-based budgeting strategy.

Hon. Noah Mutebi, MP for Nakasongola County, advocated for the hiring of experienced project contractors to ensure successful execution.

Earlier in the House, the Hon. Asuman Basalirwa (JEEMA, Bugiri Municipality) informed the MPs that he was thinking about suing the World Bank for suspending loans to Uganda after the passage of the anti-gay law, claiming that it was unfair.

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