Uganda looks to secure funds for road infrastructure improvements

Date: 20/7/2012

The government of Uganda is looking to raise around $1 billion (£639 million) in order to improve its road network and infrastructure.

Officials in the country will look to broker a number of contractor-financing arrangements in order to enable the building of 1,900 kilometres of roads, according to Reuters.

It's a sign of a slightly different direction being employed by the country, which has previously used budgetary allocations in order to fund such infrastructure developments.

However, officials feel that if they were to wait to amass funds for the project in this way then it could be a significant way down the lane before the plans came to fruition.

Low tax revenues have meant that the country's road network remains poor and is serving only to stifle growth in what is east Africa's third largest economy.

However, Dan Alinange, spokesman for the state-run Uganda National Roads Authority (UNRA), told the news provider that the government is keen to address the problems with roads in the nation.

"This is a small economy and if we're to wait for tax revenues to come in so that we develop these roads it may take time," he said.

"So our new strategy is getting contractors themselves to source funding from financial institutions and we're looking to raise about $950 million to construct 1,900 kilometres."

According to Mr Alinange, UNRA has already sent out a number of calls for expressions of interest and it hopes to receive concrete proposals by October.

This, it is hoped, will lead to the first contract being handed out by early next year.

Contractors, according to UNRA, will be required to negotiate with the country's finance ministry on issues such as interest rates and repayment periods before anything is decided.

According to Ugandan officials, the lack of basic infrastructure within the country, as well as a persistent power crisis, has impinged on the growth potential of the country.

It has already set its stall out to be among the top 50 oil producers in the near future.

Posted by Nick Anderson