World Bank resumes funding to road sector

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The World Bank has lifted the suspension of funding for key road projects, including the 100km Kyenjojo-Kabwoya road under the Albertine Region Sustainable Development Project (ARSDP) and the 340km Tororo-Mbale-Soroti-Lira-Kamdini stretch under the North Eastern Road-Corridor Asset Management Project (NERAMP).

The Bank’s acting vice president for Africa, Ms Mamta Murthi, in a letter dated June 6 to Finance minister Matia Kasaija, said the decision is based on satisfactory government’s efforts in addressing the issues that led to back-to-back unplugging of funding from the projects in December 2015.

“We appreciate all your government’s efforts over the past year and half, and urge you to continue the momentum of the positive reforms and actions,” Ms Murthi wrote.

She also spelt out other conditions as ensuring that efforts continue to address more contentious or complicated cases of land compensation, adhering to the principle that no road works will be undertaken in any sections where land compensation has not been completed, and expediting the procurement of NGOs to enhance social impacts on the projects.

The international financial institution that offers loans and advice to countries, first pulled the plug on Shs874b ($265m) for roads under the Uganda Transport Sector Development Project (TSDP) and later Shs364b for the ARSDP and NERAMP, respectively. NERAMP is a Shs812b ($243m) package that was conceived in 2014 and supposed to run until 2024 to rehabilitate roads that are key to enhancing the East African Community integration.

This was after the contractor on 66.2km Kamwenge-Fort Portal road, one of the projects under TSDP, the state-owned Chinese Railway Seventh Group (CRSG), was cast in the spotlight by a local child rights NGO that accused its workers of preying on underage girls in the area of the site and also sexually abusing female employees hired on the Shs120b project.

The government, after cancellation of funding, first downplayed the situation but woke up later to the fact they could not get the money elsewhere, and went on a charm offensive to woo the World Bank, including addressing the issues that kicked up the storm.

In April, this newspaper reported how a government team led by Mr Kasaija, Bank of Uganda Governor Emmanuel Tumusiime-Mutebile, Secretary to the Treasury Keith Muhakanizi, Gender Permanent Secretary Pius Bigirimana, and Uganda National Roads Authority boss Allen Kagina, went to the Bank’s headquarters in Washington for discussions on possible resumption of funding for both the roads and the Shs5 trillion ($1.5b) in new lending that was also withheld over government’s poor absorption record of donor money.

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