Uganda Seeks 330 Million Euros From Spanish Fund for Railways

KAMPALA (Capital Markets in Africa) — Uganda plans to borrow 330 million euros ($361 million) from Spain’s Corporate Internationalisation Fund to refurbish its colonial-era meter-gauge railway, the Ministry of Finance said.

At least 24.6 million euros will fund the first rehabilitation phase, the ministry said in a statement without providing details. The government of East Africa’s third-biggest economy received financing proposals from the Spanish government and other European Club Association members, it said.

Uganda wants to rehabilitate the line after failing to secure financing from the Export-Import Bank of China for a planned standard-gauge rail linking the capital, Kampala, and the Kenyan border.
Separately, Uganda is also considering a $229.5 million African Development Bank loan, $90 million euros from the French Development Agency in addition to a European Union grant of 90 million euros for a proposed 95-kilometer (59-mile) highway linking Kampala to Jinja in the east, the ministry said.

The Ugandan parliament is also discussing $119 million from the Industrial and Commercial Bank of China to upgrade some roads in the region where it has discovered oil, the ministry said.
Africa’s biggest coffee exporter had public debt of $13.5 billion at the end of 2019 and foreign creditors accounted for about 65% of that. The government projects a budget deficit at 8.7% of gross domestic product by the end of June.

Source: Bloomberg Business News