Parliament Approves Shs 1.5 Trillion in Loans to Supercharge Energy Exports and Road Infrastructure
Funding to support cross-border power line, transmission upgrades, and critical road networks in eastern Uganda.
Kampala,Uganda
Uganda’s Parliament has approved loans totaling Shs 1.5 trillion to fund several major infrastructure projects, including energy transmission and road construction.
The largest tranche—US$121.96 million from the African Development Fund—is earmarked for a 299 km power line stretching from Olwiyo to South Sudan’s Gumbo, allowing Uganda to export its surplus electricity. The government currently generates over 2,000 MW but uses less than half of it, making cross-border trade a lucrative opportunity.
Another portion of the funds (€342.5 million) will upgrade Uganda’s domestic electricity infrastructure, including the double-circuit 400 kV Karuma–Tororo line and a substation in Ntinda. The improvements are expected to reduce transmission losses and make power supply more reliable, particularly for industrial zones.
The third component of the loan (€230.4 million) will finance approximately 127 km of roads between Jinja, Bukungu, and Jinja City—boosting transport links, easing trade, and creating thousands of job opportunities.
Economists welcome the move, noting the potential for economic returns through regional energy sales and better logistics. But some lawmakers have raised red flags: they demand full transparency in the loan agreements and power-purchase deals to ensure the debt benefits ordinary Ugandans.
Why It Matters:
Energy export potential: The power line to South Sudan could generate new revenue and regional leverage.
Infrastructure push: Improved transmission and roads support industrial growth and rural connectivity.
Debt risks: With public debt already high, the success of these projects depends on effective execution and accountability.
What to Watch For:
How quickly construction begins on the power line and road projects.
The terms of power export agreements (cost, pricing, demand).
Parliamentary oversight and public disclosures around the loan deals.
