Algiers/Kampala, May 26, 2025 — Uganda has secured a landmark development financing package worth US$800 (Shs 3tn) following the signing of a new Country Engagement Framework (CEF) with the Islamic Development Bank (IsDB), aimed at accelerating economic resilience and sustainable human development between 2025 and 2027.
The agreement was formalized at the 50th Annual Meetings of the Islamic Development Bank Group held in Algiers, Algeria, where Uganda’s Permanent Secretary and Secretary to the Treasury, Ramathan Ggoobi, and IsDB Vice President Dr. Rami Ahmed, appended their signatures to the framework.
“This framework aligns closely with Uganda’s aspirations under the 10-fold Growth Strategy, focusing on structural transformation, human capital development, and climate resilience,” said PSST Ggoobi after the signing ceremony.
The engagement framework focuses on two key areas. The first is supporting climate-resilient infrastructure development, particularly in the transport and energy sectors, to drive structural transformation. This also includes interventions in agriculture to bolster food security and expand Uganda’s export base.
The second priority is enhancing human capital for inclusive development, with targeted investments to improve health outcomes and expand skills development in key sectors such as agriculture, ICT, health, hospitality, and petroleum.
Implementation of the framework will be guided by six cross-cutting themes: development of tourism infrastructure and human capital, promotion of digitalization and innovation, climate change mitigation and adaptation, women and youth empowerment, Islamic finance, and strengthening private sector competitiveness.
Of the total US$800 million resource envelope, the IsDB will provide US$500 million, while the Islamic Corporation for the Development of the Private Sector (ICD) and the International Islamic Trade Finance Corporation (ITFC) will each contribute US$150 million. Additionally, the Islamic Corporation for the Insurance of Investment and Export Credit (ICIEC) has earmarked US$400 million for insurance and reinsurance support.
Among the flagship projects to benefit from the new framework is the Standard Gauge Railway (SGR), a critical component of Uganda’s regional transport integration plan. The SGR is expected to link Kampala to the Kenyan border at Malaba, eventually connecting Uganda to the port of Mombasa.
The project aims to reduce transport costs, improve freight efficiency, and position Uganda as a regional logistics hub.
The IsDB funding will support preparatory works and construction of key segments, potentially unlocking co-financing from other development partners and bringing renewed momentum to the long-delayed project.
Other key projects to be financed include the construction of Regional Oncology Centers in Arua and Mbale, the Bukedea Water Works Project, the Second Drylands Integrated Development Project in Karamoja (DIDPK-II), the rehabilitation and equipping of Katakwi General Hospital, and the establishment of Lwengo General Hospital.
Additional investments will target the Rural Electrification and Connectivity Project, upgrades to roads such as Nakapiripirit-Amudat, Namalu-Lolachat-Nabilatuk-Lokapel, and Isingiro-Kigarama-Kashumba-Kasheshe-Tanzania Border, as well as the Water Supply and Sanitation Program III.
Uganda’s agreement was part of broader financing approvals made during the 360th Meeting of the IsDB Board of Executive Directors, which endorsed over US$1.32 billion in development funding to support inclusive growth, climate adaptation, and livelihoods across member countries.
This year’s IsDB annual meetings, themed “Diversifying Economies, Enriching Lives,” resonate with Uganda’s development agenda and underscore a shared vision between Kampala and Jeddah for transforming economies through inclusive and sustainable interventions.
