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Blog: Uganda Witnessing Infrastructural Renaissance?

Transporting a container of goods by road from Mombasa to Kampala, a distance of 1,154kms, costs $2,100 ($1.82/km)

Story Highlights

  • Museveni pushed for the upgrading of 2,025km of gravel roads to tarmac with main focus on oil roads
  • Average sector performance against the Manifesto commitments stands at 60%
  • In the 2018/2019 financial year, 382km of paved network will be completed

Aviation, roads and bridges all made good implementation strides as the NRM government took stock of its annual manifesto report last week.

The Ministry of Works in a detailed briefing last week highlighted all the major progress made by each sub-sector from roads, railway, aviation, water transport and bridges.

During the unveiling of the NRM Government Manifesto for 2016-2021, President Museveni pledged to continue with his infrastructure development by tarmacking all the major roads in the country.

While the president’s continued emphasis on infrastructure as a bedrock on which the country can reach middle income status can’t be disputed, questions remain on efficient implementation of the infrastructure projects – with corruption scandals hitting major projects like Katosi road and the delay of construction of other projects like the Standard Gauge Railway.

The Katosi scandal hit so hard that the president reshuffled the top leaders at the Ministry of Works and at the Nakawa based Uganda National Roads Authority.

According to public opinion, the changes were long overdue – the Ministry of Works previously known for corruption scandals needed a cleanup and putting two no nonsense ladies at the helm of the Ministry.

Eng Monica Azuba Ntege, previously a board member of Uganda National Roads Authority as the Minister and earlier, having appointed Allen Kagina as the Executive Director of UNRA, was a ray of hope.

According to insiders, the president needed to implement his 2016-2021 infrastructure agenda without hiccups.

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“You have seen us deliver before, you can trust us with the future,” emphasized President Museveni in 2016.

Three years into his 5-year term – according to the Prime Minister, Ruhakana Rugunda, who was speaking during the launch of the NRM Manifesto last week, the NRM Government has achieved 62% of its 2016-2021 manifesto.

How has transport infrastructure performed?

According to the manifesto, the NRM Government recognizes that reliable transport infrastructure, including roads, railways, air and water transport, is very crucial for a landlocked country like Uganda.

It is a prerequisite for opening up production zones to markets. Transport is one of the key cost pushers for producers and manufacturers. The cost of transport adds 25% to the cost of goods while electricity at current prices adds 14%.

Works and Transport Minister Hon Monica Azuba (C) at the opening of the AIM conference at the Kampala Serena on Wednesday

The two account for 39% of the cost of goods. The cost of transport in Uganda is very high, compared to a country like China.

Transporting a container of goods by road from Mombasa to Kampala, a distance of 1,154kms, costs $2,100 ($1.82/km), while transporting a similar container from Shanghai to Beijing in China, a distance of 1,207.5km costs $1,500 ($1.24/km), representing a difference of about 40 percentage points between the two countries.

Upon Museveni’s swearing in and with an Engineer at the helm of the ministry of Works, the president embarked on ambitious infrastructure projects that include the $2.3bn ambitious Standard Gauge Railway Project, the Bukasa Port project, Uganda Airline, revamping of the Meter Gauge Railway, expansion of Entebbe Airport, construction of a new Airport in Hoima and Kabale and improved maintenance of District Urban and community access roads through procurement of 1,151 pieces of road equipment for districts.

He also pushed for the procurement of eight (8) ferries, construction of 112 bridges and maintenance of existing ones and upgrading of 2,025km of gravel roads to tarmac with main focus on oil roads.

Airline

While delivering his speech on the 2016 Independence Day, the president said: “We allowed Uganda airline to die because it was making losses and, at that time, Ugandans were not traveling as much as today.”

He further revealed that Ugandans are spending $420 million per year on travel.

Having witnessed the “water salute” while the new fleet of Uganda Airlines arrived at Entebbe International Airport on 23/04/2019, it remains unknown how much money will be saved by the national carrier.

The Airline set to start commercial flights in July will start with flights to Lusaka, where Uganda sells Pharmaceuticals worth billions of shillings.

The bombardier jet at Entebbe International Airport

The airline will also fly to Mombasa, Nairobi, Khartoum, Bujumbura, Kinshasa, Accra and Johannesburg. Beyond promoting Uganda as a tourist and business destination, it remains to be seen if Uganda Airlines will be a profitable airline with other regional airlines reporting losses of up to $200m.

The past 3 years have seen the president brag about the nice roads at every chance he gets, so far, we have seen ground breaking and commissioning of major projects in the Works and Transport sector. Some of the launched projects include the Entebbe Express Highway, Jinja cable stayed bridge among the 15 road upgrading projects completed, adding a total of 632.1km to the paved national road network. 16 out of the 18 key bridges mentioned in the Manifesto have been completed.

The road expansion plan has seen the Government pave major roads connecting the North, East, South and Central parts of the country. The Government has also undertaken to expand Kampala City Roads and construct fly overs to reduce traffic within Kampala. Last year, Museveni was ground breaking the $1bn Kampala – Jinja Expressway that is 77km long.

However, close scrutiny at the NRM manifesto shows that the total cost of the Manifesto commitments in the Works and Transport sector amounts to Shs 37,013.31bn yet Sector allocated resources for the period 2016/17-2020/21 is Shs 22,579.74bn, thus, a funding gap of Shs 14,433.57bn. How will the Government cover this gap?

Fear of stress on the economy due to debt is completely not without merit as Uganda continue to borrow for some of these infrastructure projects.

Earlier this year, Uganda’s auditor general warned in a report that public debt from June 2017 to 2018 had increased from $9.1 billion to $11.1 billion. With China being Uganda’s biggest country-lenders, with over $3 billion in development projects through China state owned banks.

A leaked report in December 2019 in Kenya showed that Kenya used parts of Mombasa Port as collateral to access a loan from China for financing a $3 billion railway it built from the port to Nairobi.

Both Chinese and Kenyan officials have denied that the port’s ownership is at risk.

Uganda’s Minister of Finance rubbished reports of Uganda’s sovereignty being put at risk through conditions placed on Chinese loans, “As long as some of us are still in charge, unless there is really a catastrophe, and which I don’t see at all, that will make this economy going behind. I’m not worried about China taking assets. They can do it elsewhere, I don’t know. But here, I don’t think it will come”.

Impression of the proposed Nile SGR Super Bridge. The bridge will be 1km long, axle loading 27.5 tones per axle with no pillarspiers in water

According to Fred Muhumuza, an economist, Uganda’s oil might be one of the ways, China might decide to pay it’s self back.

All this has not hindered Uganda’s ambitious infrastructure agenda. In the 2018/2019 financial year, 382km of paved network will be completed; when added to the 632.1km, it results into 1,014.1km. This represents 46% of the Manifesto target of 2,205km.

Manifesto

According to Uganda’s Minister of Works and Transport, Monica Azuba, “Average sector performance against the Manifesto commitments stands at 60%. Most of the targets under road and air transport are on course. However, performance under railway and inland water transport was below target. However I am optimistic that we shall exceed the set target by 2021 – nothing will stop us.”

She added that the demand for transport infrastructure emanates from the requirements of a growing population which has hit 41m people.

“If we don’t put in place an efficient and reliable infrastructure, the country won’t be competitive, we won’t attract foreign direct investments, local businesses won’t access markets easily and our people will not have jobs. The investment Government is making in transport infrastructure provides economic and social opportunities that result into positive multipliers such as access to markets, employment and additional investments,” says Monica Azuba.

While it’s true that transport infrastructure is a lifeline of a nation as it adds speed and efficiency to a country’s progress by bringing down the costs of doing business, Government must catalyse other sectors of the economy for Ugandans to fully benefit from the improved transport infrastructure.

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