M7 Cries To World Bank Over Loans
By Serestino Tusingwire
The president of Uganda His Excellency Yoweri Kaguta Museveni has cried to the World Bank requesting it to remove the loan ban slapped on Uganda for failure to utilize the monies it borrows.
In a statement released recently, World Bank “took a decision to withhold new lending to Uganda effective August 22, 2016 while reviewing the country’s portfolio in consultation with the government.”
President Museveni has therefore written to the bank promising that his government is addressing the structural gaps and other loopholes that compelled the bank to announce withholding of more than $1.5b (Shs5 trillion) in new lending until further notice.
The President’s letter to WB is part of efforts by government to salvage the loans and save many projects whose failure could have wide economic and political ramifications.
The secretary to the treasury, Keith Muhakanizi, confirmed that the President has engaged the WB to resolve the issue.
A delegation led by Finance minister Matia Kasaija is set to travel to the Bank’s headquarters in Washington DC to plead Uganda’s case at the International Development Association.
Explaining how the country got into this situation, Muhakanizi said: “This is largely inefficiency and a management problem on the part of accounting officers and it definitely bounces back to affect our planning.”
He added that absorption had gone down partly as a result of the ongoing reforms instituted to contain the high frequency leakages (corruption) in the sectors for which the loans are acquired.
The President has therefore directed that accounting officers that fail to justifiably absorb loans be punished without fail.