Africa-Press – Uganda. Speaker Rebecca Kadaga acknowledged the changes and referred the revised request for scrutiny by Parliament’s Committee on National Economy.
The government is seeking to borrow up to €327 million (Shs1.4 trillion) to fund the refurbishment of the Kampala-Malaba meter gauge railway project.
Mr David Bahati, the State Minister for Planning, submitted the request for consideration by MPs on Wednesday.
He said €216.71m is to be borrowed from the African Development Fund, €84.4m from the African Development Bank and €26m from the Corporate Internationalisation Fund of Spain.
Before the request was presented to the House, the government withdrew a proposal to borrow up to €107.4m from the African Development Fund, €193.7m from the African Development Bank and €26m from the Corporate Internationalisation Fund of Spain it earlier submitted to bankroll upgrade of the same railway.
“Changes in the loan amounts and terms require a formal withdraw of the loan request and submission of a new loan request to Parliament,” Mr Bahati said.
Speaker Rebecca Kadaga acknowledged the changes and referred the revised request for scrutiny by Parliament’s Committee on National Economy.
Busia Municipality Member of Parliament Geoffrey Macho questioned why the government, which has been trumpeting its advanced plans for the construction of a Standard Gauge Railway, had made an about-face to repair the old tracks.
“Whereas other countries are moving towards the Standard Gauge Railway, we are (instead) moving towards refurbishing the old ones; the Stone age railway system,” Mr Macho said amid giggles from members.
As questions piled, Finance Minister Matia Kasaija told the media from outside Parliament that Uganda was not abandoning SGR project, but it was pointless to focus on its construction to Malaba border post when the Kenyan leg is stuck in Naivasha.
Originally conceived in 2008 as a regional flagship physical link under the Northern Corridor Infrastructure Project, the region’s leaders hoped the rail connectivity would significantly slash haulage costs and spur economic development.
Kenya built and has an operational SGR from Mombasa port city to its capital, Nairobi, while work stalled in Naivasha over financial hiccups.
The country’s leaders were looking east to China, as was Uganda that requires $2.3b for the project, for financing all segments of the route planned to connect to South Sudan and Rwanda through Nimule and Mirama Hills border points, respectively.
The 273-kilometre Malaba-Kampala planned SGR works was plagued by problems from the outset: the contract award was crippled by infighting by rival Chinese firms; project cost was inflated by $120m (Shs450b); and, a tango among technocrats resulted in overhaul of the SGR executives in Uganda.
In March 2019, while on a visit to Kenya, President Museveni, after taking a four-hour ride from Mombasa to Nairobi on the Madaraka Express, as the passenger train on the SGR is called said:“It will be cheaper, faster, safer and away from the roads so that the roads remain for the drunkards and other people, if they want to kill themselves without the assistance of oil tankers and cargo.”
Following Wednesday’s loan request to upgrade the old metre gauge railway, MPs wondered whether Uganda’s SGR project has turned a pipedream.
DEBT BURDEN
Uganda, whose debt portfolio towers at Shs65.82 trillion as of December 2020 trillion, according to official statistics, with most of the money owed to China’s Export-Import (Exim) Bank, has failed to find cash to build the railway billed to slash haulage costs.
It costs $3,000 (Shs11m) to truck a tonne of goods from Mombasa to Kampala, almost double the $1,600 (Shs6m) spent to haul the same quantity by rail.
