Uganda’s unending appetite for debt: Shouldn’t we be worried?

Cissy Kagaba

What you need to know:

  • Diversion of funds. The possibility that much of the money that Uganda will borrow from Stanbic Bank will be diverted to other uses other than those for which it was borrowed is high since the details of this loan are not likely to become public despite this being a public burden.
  • Therefore, the ultimate misuse of these funds cannot be ruled out. About a decade ago, a number of development partners wrote off huge amounts of money owed to some of the most impoverished countries of the world and Uganda was a beneficiary of such write-offs.

Some time back, a story on international news agency Reuters revealed that Uganda sought to locally borrow some $661 million from the domestic-based Stanbic Bank, a subsidiary of the Standard Bank of South Africa, to fund a shortfall in the Financial Year 2019/2020 Budget.

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