Government seeks Shs843 billion loan for Jinja-Kamuli road upgrade

• The government wants to borrow €207.77 million to finance road upgrades in eastern Uganda.

• The funds will support the 127km Jinja–Mbulamuti–Kamuli–Bukungu Road and roads in Jinja City.

• Authorities say the project will improve movement of people and goods between northern and southern Uganda.

• Parliament’s Committee on National Economy will review the loan request before approval.

The government has asked Parliament to approve a €207.77 million (about Shs842.71 billion) loan to upgrade roads linking parts of eastern Uganda.

Finance Minister Henry Musasizi, together with Works and Transport Minister Fred Byamukama, presented the financing request to Parliament’s Committee on National Economy.

The loan, which will be obtained from Citi Bank and other financial institutions, will fund the improvement of the 127-kilometre Jinja–Mbulamuti–Kamuli–Bukungu Road and 10 kilometres of roads in Jinja City.

The money will also cater for land compensation and supervision of the construction works.

The government says the project will strengthen transport connections in the Busoga sub-region and provide an alternative route between northern and southern Uganda.

Musasizi told MPs that the project is economically viable, with an Economic Internal Rate of Return (EIRR) of 16.7 percent.

EIRR measures the expected economic gains from an investment compared with the money spent on it. The minister said the project’s return is above the 11 percent economic opportunity cost of capital, showing that the expected benefits outweigh the cost of investing the funds elsewhere.

Of the total loan, €179.26 million will finance road construction works and insurance, while €28.51 million will cover land acquisition and supervision costs.

Musasizi said the project has already been included in Uganda’s debt sustainability analysis and the government’s fiscal plans for the 2026/2027 financial year and the medium term.

The loan request will now be considered by Parliament before the government proceeds with the borrowing arrangement.