Financial analysts have implored government to uphold terms stipulated in contracts signed during public private partnerships.
Speaking in Kampala at the weekend, the assistant director of investment management at Bank of Uganda, Mr Alan Lwetaba, said the public must understand the approaches to alternative funding of public projects before committing to them.
Much as PPPs are an alternative to debt, Mr Lwetaba advises that prior to joining an agreement; government should be coherent of its responsibilities and ensure to uphold them to avoid consequences.
“In the event you do not pay back on time, it could have serious implications in the international market, they would not be able to borrow until they have cleared the previous loans, or until you get into another understanding with the lender,” he said.
Ms Mariam Nansubuga, the manager credit evaluation at Dfcu Bank, said the government has started embracing private public partnerships which entail that a profit driven private investor develops the infrastructure, and a concession is awarded where people through use of infrastructure, remit money until the elapse of those stipulated years.
The remarks were made in preparation for the April 5 East African Investors Conference, to be held in Kenya.
The conference will focus on East African economies and capital markets as well as global issues relevant to investors worldwide.
Meanwhile Uganda has signed a public private partnerships with investors from Malaysia, a Chinese consortium, introducing an eco-friendly green project that will include townships, treatment plants and an airport in all districts of Uganda except Kampala.
The $70b (Shs255trillion) project has a concession of 25 years.