Parliament Approves $566 Million World Bank Loan for Kampala Metropolitan Area Development

Parliament has given government the green light to obtain a loan of up to US$566 million (Shs2.1 trillion) from the International Development Association (IDA) of the World Bank Group.

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

The programme will support infrastructure development including roads, in Kampala, Entebbe, Kira, Makindye-Ssabagabo, Mukono and Nansana municipalities as well as Mukono, Mpigi and Wakiso district local governments.

Of the amount, US$518 million will be availed as a loan whereas US$48 million will be given as a grant.

The Deputy Speaker, Thomas Tayebwa, tasked the finance minister to clarify whether the loan is one of those affected by the World Bank’s recent decision to halt loans to Uganda.

“We saw the statement from the World Bank and before I put this item on the order paper, I first assessed and did judgement. But we need confirmation that this is not one of the affected projects, before we proceed,” guided Tayebwa.

The State Minister for Finance, Hon. Henry Musasizi, calmed down colleagues when he explained that the loan was valid as the World Bank Board had approved the project way back on 31 May 2022.

“The assurance I want to give this House is that the Greater Kampala Metropolitan Area Project is not among the projects affected by the World Bank statement. It is, therefore, proper that we consider the project and process it to enable the Executive commence implementation,” Musasizi said.

Tayebwa added that the statement referred to new projects and as such, all those already approved by World Bank will be brought before Parliament for processing.

The programme will further be facilitated by a loan worth US$42.66 million (Shs156.4 billion) from Agence Francaise de Development (AFD).

The Deputy Chairperson of the Committee on National Economy, Hon. Robert Migadde, presented recommendations for effective utilisation of the project funds.

He said that for KCCA and the eight Greater Kampala Metropolitan Area local governments to achieve value for money, they must be audited on services being provided at competitive unit costs and timely delivery.

“The Ministry of Kampala Capital City and Metropolitan Affairs should ensure that all infrastructure sub-projects demonstrate high value for money with clear linkages between efficiency in procedures, economy and effectiveness,” said Migadde.

He also recommended that the finance ministry and that of Kampala Capital City, should ensure loan effectiveness conditions are timely fulfilled.

This, Migadde said, will trigger timely disbursement of credit for programme objectives to be met as planned.

Hon. Betty Nambooze (NUP, Mukono Municipality) expressed concern on how the programme will be executed in the Greater Kampala Metropolitan Area where Kampala’s administration is separate from that of the other local governments.

“On several occasions, this House has tried to work out a structure that could unite this area under one entity for proper planning and running of activities but we have always run into constitutional hurdles because of the provisions of Chapter 11 of our Constitution,” said Nambooze.

She recommended that unity should be managed at ministerial level to enable seamless operations between the administrative units.

Hon. Cecilia Ogwal (FDC, Dokolo District Woman Representative) reiterated the suggestion, saying an inter-ministerial committee of Local Government and Kampala would ensure effective implementation.

Tayebwa, however, clarified that with the programme-based budgeting approach, government can easily integrate the implementation of the programme in the Greater Kampala Metropolitan Area.

The use of seasoned project contractors to ensure effective execution, was pushed for by Nakasongola County MP, Hon. Noah Mutebi.

Hon. Asuman Basalirwa (JEEMA, Bugiri Municipality) had earlier told MPs in the House that he was considering suing the World Bank for halting loans to Uganda following the passing of the anti-gay law, arguing that it was unfair.