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China’s institutional lender, the Export-Import (EXIM) Bank of China has agreed to lend Uganda approximately $456.37m (about sh1.7 trillion), meant for financing the upgrade and construction of Uganda’s much-anticipated national oil roads.

The money, according to the finance ministry, will be used to partly finance three packages (lots), which make part of the oil roads in five districts. The roads are meant to facilitate the efficient development and production of the national oil resources.

The selected critical roads, traversing Hoima, Masindi, Pakwach, Buliisa and Kakumiro districts, will, according to the Government, comprise a 50-metre right of way and 7-metre carriageway, upgraded to class two bitumen. FinanceministerMatiaKasaija said yesterday that the roads are pivotal infrastructure that would enable the movement of required plant and equipment to the oil fields, as well as construction materials, workers and consumables.

He said the roads also have the potential to significantly improve the livelihoods of the people in the oil corridor districts. This is because they present considerable opportunities for the supply of food and other services.

“Although this money is not enough, we want to use it to finance the Masindi- Kasanja/park junction, the Tangi junction, Paraa-Buliisa road and Wanseko-Bugungu roads in lot 1. We shall also do Hoima-Butiba-Wanseko in lot 2 and Buhimba-Bulamagi- Igayaza-Kakumiro in lot 3,” Kasaija said.

The Government is already seeking a resolution of Parliament approving the borrowing of the money from the EXIM Bank of China. The motion for the resolution was A view of the Entebbe Expressway as one heads towards the Kajjansi Intersection. The highway was constructed with funds from China Exim Bank. File photo Kasaija Oboth Kadaga yesterday one of the items on Parliament’s Order Paper.

Loan to cover 85% According to the documents seen by New Vision , Exim Bank will only cover 85% of the commercial contract for each package, requiring the Government to seek complementary funding for the project.

“We are looking elsewhere to ensure that the project is fully covered. These oil and gas roads are our priority and I want to ensure that they are fully, efficiently and well done, ahead of oil production,” Kasaija said.

The loan proposal was first presented to Parliament by state finance minister (planning) David Bahati in May, as required under Article 159 of the Constitution. State of Uganda’s debt According to the finance ministry, Uganda’s public and publicly guaranteed external debt exposure as at end of December last year stood at $11.52b.

It was $10.24b at the end of December 2017. The total stock of government domestic debt stood at sh14.3 trillion (equivalent to $3.85b). According to works minister Eng. Monica Azuba Ntege, about 700km of roads must be built to facilitate oil production. Progress of roads According to the head of public and corporate affairs at the Uganda National Roads Authority (UNRA), Mark Ssali, the progress of civil works on package one — designing and building of Masindi (Kisanja)- Park (Murchison) junction and Tangi (Pakwach) junction- Paraa-Buliisa and Wanseko- Bugungu roads (159km) stands at 15%. Progress on the second package — Hoima-Butiaba- Wanseko (111km) is at 16%.

The physical progress on the third package Buhimba- Nalweyo-Bulamagi and Bulamagi-Igayaza-Kakumiro roads (93km) is at 15%. The tentative completion time for the three roads already under construction is April 2021. Most of the 12 roads, some currently under construction, traverse agricultural communities.

The 25km Hohwa-Nyairongo-Kyarusesa might be one of the shortest among the 12 roads. But it is one of those roads that will pass through villages where agricultural activity is now thriving. Welfare to improve Mustapha Kasaija, a resident in the area, believes agricultural activity will increase and more opportunities will be created for the farmers as the road network improves.

Earlier, the Government had set 2020 as the timeline for first oil. However, there were fears over whether the roads would really be complete by 2020 to move construction equipment for the development phase of the industry. There is no definite timeline now, although it is clear oil production will start after 2020.

The Woman Member of Parliament for Kikuube District, Tophas Kaahwa, said the paved road network, coupled with other infrastructural improvement projects being undertaken in the area, will improve the people’s welfare.

“Most of the areas, where roads are being constructed, now have electricity. These developments have increased the business activity. For instance, welders are making doors and windows in the trading centres. Health facilities and schools are being built too,” she said.

The upgraded road network, she said, is expected to have an enormous effect on agricultural production and access to markets. “Some farmers have been selling their produce at give- away prices because the middlemen were complaining about the bad roads. But, now access is improving and farmers can take their goods to markets because roads between their gardens and markets are being built,” Kaahwa said.

Recently, UNRA signed a contract with the China Railway Seventh Group to build three more roads (109km) in Bunyoro region. The UNRA executive director, Allen Kagina, signed the contract with China Railway Seventh Group representative, Bian Deng.

The three — Masindi-Biiso (54km), Kabaale-Kizirafumbi (30km) and Hohwa- Nyairongo-Kyarusesa (25km) — form package five of the oil roads. The cost for building the three roads is sh504b. They will link Masindi, Buliisa, Hoima and Kikuube districts. The roads authority split the 12 roads (about 700km) into six packages.

Now, it is only roads in packages four and six whose contracts have not been signed. Package four includes designing and building of Lusalira-Nkonge-Lumegere- Ssembabule roads (97km). Package six will involve designing and building the Kabwoya-Buhuka (43km) and Ntoroko-Karugutu roads (55km)

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