December 7, 2021

edge.ug

we say it the way it is

China to take over Entebbe airport over Shs740bn loan

Entebbe airport

0 2
Read Time:1 Minute, 33 Second

The Parliamentary Committee on Commissions, Statutory Authorities and State Enterprises (COSASE) Meeting at Parliament chaired by Hon Joel Ssenyonyi on Thursday discovered that Entebbe Airport is at the risk of being mortgaged or taken over by China Exim Bank under a troubling Loan Agreement.

The Finance Minister Matia Kasaija could not ably account for the loan agreement, according to Shadow Foreign Affairs minister Muwada Nkunyingi.

“The agreement has alot of troubling clauses. Entebbe Airport ownership may shift to China. Finance Ministry and Civil Aviation Authority seems to have executed a dangerous mortgage deal with China under a poorly crafted loan agreement,” he added.

According to this, EXIM Bank of China can take over Entebbe Airport in case Uganda fails to pay back a loan of 740 billion shillings. The loan was advanced to Uganda for upgrade of Entebbe Airport.

Kasaija admitted that there are loopholes in the 740 billion loan agreement Uganda signed with the Exim Bank of China for the expansion of Entebbe International Airport.

In the agreement, Uganda will be subjected to the Chinese legal regime in case of any disagreements or failure to pay the loan to the Bank.

In October 2015, then State Minister of Finance, David Bahati, assured the legislators that the implementation of the project would be monitored to ensure the funds are properly utilised.

On October 8, 2014, Uganda’s Civil Aviation Authority (CAA) and China Communications Construction Company (CCCC) entered into a contract for the up grading and expansion of Entebbe International Airport (Phase 1).

To access funding for the project, the Government of Uganda (GoU), represented by the finance ministry, signed a concessional agreement with EXIM Bank of China dated March 31, 2015 for the principal amount not exceeding Renminbi 1.26 billion (about $200m) and interest to be charged at a rate of 2% per annum.

Happy
Happy
0 %
Sad
Sad
17 %
Excited
Excited
50 %
Sleepy
Sleepy
0 %
Angry
Angry
17 %
Surprise
Surprise
17 %