Uganda is seeking to borrow up to €207.7 million, or about $242.6 million, from Citibank to finance the construction of a major road in the eastern part of the country, according to CNBC Africa and Reuters. The proposed borrowing is intended to support infrastructure development and improve transport connectivity in the region.
The financing would add to Uganda’s growing use of international bank funding for large infrastructure projects. Citi has previously played a role in arranging financing for Ugandan transport infrastructure, including a €126 million loan supporting the 97 kilometre Lusalira Nkonge Sembabule road upgrade.
The latest project is significant for Uganda because improved road networks can lower transportation costs, strengthen links between production centres and markets, and support trade and regional economic activity. Infrastructure investment is also a key component of the government’s broader development strategy as Uganda seeks to expand economic activity beyond Kampala and improve connectivity across the country.
For investors and businesses, the proposed financing highlights the continuing demand for infrastructure capital across East Africa. If completed, the Citi backed project could create construction opportunities while improving the movement of goods and people in eastern Uganda, although the borrowing will also add to the government’s external financing obligations.
