KAMPALA (Reuters) -Uganda plans to borrow $400 million from several lenders including Africa Development Bank (AfDB) and a United Nations fund to finance transportation and agriculture projects, a finance ministry official said.
Opposition political parties have criticised the government over rising public debt levels in recent years, and Uganda’s central bank has said the cost of servicing the debt is putting pressure on public revenues.
The government says the increased borrowing is needed to fund infrastructure projects that will boost economic growth.
The bulk of the new borrowing, $253 million, will be from AfDB, State Minister for Finance Henry Musasizi said late on Wednesday in parliament.
Other lenders include the U.N.’s International Fund for Agricultural Development(IFAD), the Islamic Development Bank and UniCredit Bank Austria, he said.
Musasizi did not give a timeline for when the borrowing will be done.
He said much of the credit will be used to fund stalled construction works on a new toll road that forms a section of a highway connecting Uganda and neighbouring Rwanda, Burundi and Democratic Republic of Congo.
Some of the funds will also be used to construct new facilities in the health sector, he said.
Uganda’s total stock of public debt was $29.1 billion last year, up 18% from the previous period, according to the finance ministry.
(Reporting by Elias Biryabarema; Editing by George Obulutsa and Kim Coghill)
