Parliament defers approval of US$1.34 billion World Bank loan request

 

Parliament has deferred consideration and approval of a government request to borrow up to US$1.341 billion from the International Development Association (IDA) of the World Bank. The loan is intended to finance several key projects, including the Uganda Cities and Municipal Councils Infrastructure Development (UCMID) programme.

While chairing the plenary sitting on Tuesday, 28 October 2025, Deputy Speaker Thomas Tayebwa directed the Committee on National Economy and the Minister of Finance to harmonise their positions on the loan request and report back to the House.

“If the conditions for UCMID have remained standard, the Minister should present them to the committee [on National Economy] tomorrow [Wednesday, 29 October 2025] morning. The Chairperson and Members can then agree that there is no need to prepare a new report,” said Tayebwa.

During the sitting, Committee Chairperson, Hon. John Bosco Ikojo, proposed deferring consideration of US$500 million earmarked for the UCMID programme, which is part of the total loan and another US$40 million grant from the Window for Host Communities and Refugees (WHR).

“We make this recommendation to allow time for the financing agreement to be presented to Parliament, so that we can approve the terms and conditions in accordance with Article 159 of the Constitution,” Ikojo said.

However, State Minister for Trade, Industry and Cooperatives (Industry), Hon. David Bahati, opposed this position, urging Parliament to approve the entire loan package.

“World Bank loans are concessional and have terms and conditions. Separating one component saying we have not approved it, would actually jeopardise other components of the entire loan. I propose that we approve the entire loan, because the terms are the same,” Bahati said.

Hon. Karim Masaba (Ind., Industrial Division, Mbale) also called on the Finance Minister to share the loan terms and conditions with the House to avoid unnecessary delays.

“In Mbale City, residents have surrendered land and demolished houses to make way for UCMID road works. The loan was negotiated as a whole and should be considered as such,” Masaba said.

Supporting the loan, State Minister for Lands (Urban Development), Hon. Mario Obiga Kania, noted that the UCMID terms were consistent with those of earlier project phases.

“The Minister of Finance would not have proceeded to the Development Committee to submit this information to the World Bank, unless those terms were agreed upon initially. The rest is the procedure of the World Bank on the issues of the projects which are going to be undertaken,” he said.

The US$1.341 billion loan is expected to fund several additional initiatives, including the Northern Uganda Social Action Fund (NUSAF IV), the Development Response to Displacement Impacts Project (DRDIP), the Uganda Learning Acceleration Programme (ULEARN), and the Uganda Strengthening Public Investment and Asset Management for Growth and Resilience Programme (PIMPLUS).

The government also expects to receive US$328.3 million in grant funding to support these projects and programmes. 

Distributed by APO Group on behalf of Parliament of the Republic of Uganda.