Cabinet on Monday agreed to borrow about Euros 108m (about Shs430b) from China for construction of oil roads.
Government will borrow the money from the Industrial and Commercial Bank of China to finance the construction of Masindi-Biiso, Kabaale-Kiziranfumbi and Hohwa-Nyairongo-Kyarusesa-Butoole roads.
“Upgrading and constructing the national oil roads will facilitate the efficient development of the strategic national oil resources,” Uganda Media Centre communications and media relations manager Denis Katungi said yesterday.
He did not elaborate what interest rate the government will pay on the loan or the loan period.
Mr Katungi said the upgrade will add to the network of road infrastructure required for movement of construction materials, workers and consumables from other parts of the country to the oil region.
In March last year, government signed a contract with China Railway Seventh Group to design and construct a 97km road connecting Masindi-Biso, Kabaale-Kiziranfumbi and Hohwa-Nyairongo-Kyarushesha-Butoole.
Minister of State for Planning David Bahati in May last year presented to Parliament a loan request of $456.37m (about Shs1.7 trillion) from China Exim Bank to fund the upgrade and construction of national oil roads.
The projected total length of the oil roads is 700km.
Efforts to get a comment from the Minister of Finance, Mr Matia Kasaija were futile by press time. He asked this newspaper to call him later, saying he was in a lecture.
The chairperson of the Parliamentary Committee on National Economy, Ms Syda Bbumba, also could not talk to Daily Monitor. She said she was busy in Parliament.
Uganda has received large credit lines from China in recent years as part of the Asian giant’s so-called Belt and Road Initiative. Construction of the oil roads would accelerate efforts to commence crude oil production in Uganda, which has failed to take off 14 years after crude reserves were discovered.
Source: The Monitor