Uganda seeks up to $242 million from Citibank for infrastructure projects

Uganda is seeking up to €207.7 million ($242.55 million) from Citibank to finance the upgrade of a major road network in the east, adding to government borrowing as President Yoweri Museveni’s administration steps up spending on infrastructure. 

The proposed loan would finance the 127-kilometer Jinja-Mbulamuti-Kamuli-Bukungu road and 10 kilometers of roads in Jinja City. The project would cover 137 kilometers and improve links across the Busoga sub-region. 

Finance Minister Henry Musasizi told lawmakers the road would make it easier to move people and goods while providing an alternative connection between northern and southern Uganda. The proposal has been referred to Parliament’s Committee on National Economy for review. 

The borrowing comes as Uganda faces higher debt-service costs and a weakening fiscal position.

The International Monetary Fund said public debt reached 52.4% of GDP in fiscal 2024-25, while its latest outlook points to further pressure on government finances.

Road project and financing 

Of the proposed financing, €179.26 million($209.5 million) would go toward civil works and commercial insurance, while €28.51 million($33.3 million) would cover land compensation and construction supervision. 

The government says the road investment will strengthen transport links in eastern Uganda and support the movement of goods between major commercial centers. The final loan terms and construction timetable have not been disclosed.

Debt pressure grows 

Uganda’s debt burden is drawing closer attention as the government seeks financing for infrastructure and other public projects. The IMF has warned that debt-service costs remain a challenge even as economic growth stays strong. 

Fitch Ratings affirmed Uganda’s sovereign rating at B with a stable outlook this month.

The ratings agency said Uganda’s debt and interest burden remain constraints on its credit profile.

Citibank’s role 

Citibank is one of the world’s largest financial institutions, providing banking and financial services to governments, companies and investors across global markets. 

For Uganda, the proposed financing offers a way to fund a long-awaited road upgrade, but it also adds another loan to the government’s balance sheet as debt repayments take up more public revenue. 

The project shows the difficult choice facing Uganda: improve roads and support trade while keeping borrowing and debt-service costs under control.