UGANDA has inked a significant agreement with Saudi Arabia’s Islamic Development Bank (IDB), securing a $295 million loan to finance infrastructure projects, announced the country’s finance minister on Tuesday. This move underscores Uganda’s commitment to diversifying its sources of external funding amidst ongoing challenges in resuming lending discussions with the World Bank.
Finance Minister Matia Kasaija finalised the loan agreement with IDB President Muhammad Al Jassar during a signing ceremony held in Riyadh, the capital of Saudi Arabia, as revealed in a social media post by Kasaija.
The allocated funds are earmarked for the construction of a bridge spanning the River Nile in northwest Uganda, along with the development of roads totalling 105 kilometers, according to the ministry of finance.
The decision to seek funding from the Islamic Development Bank reflects Uganda’s proactive approach to securing financing for crucial infrastructure projects, particularly in the face of delays in negotiations with the World Bank.
The World Bank, traditionally Uganda’s principal external lender, halted new loans to the country following the implementation of stringent anti-homosexuality legislation.
Uganda’s engagement with the Islamic Development Bank not only underscores its commitment to infrastructure development but also highlights its strategic efforts to diversify sources of external funding to fuel economic growth and development initiatives.
