Uganda East African Community (EAC) states have resolved to form public-private partnerships to finance major infrastructure projects such as the Standard Gauge Railway (SGR), roads and telecommunications.

According to the leaders of Uganda, Rwanda, Kenya, Tanzania and DRC, private sector financiers such as venture capitalists will help the governments quickly undertake the Northern Corridor Integration Projects (NCIPs) instead of relying on costly loans from banks.

The resolution was reached during the regional meeting on the implementation of the directives of the 14th Heads of State Summit under the Northern Corridor Integration Projects (NCIPs) that ended in Kampala on Wednesday.

“High cost of financing in preparing bankable projects has hindered the finalisation of NCIP projects. The private sector to be continuously engaged to effectively participate and mobilise funding for NCIPs. This is to continue to be undertaken through engagement with the Apex bodies of the private sector in the partner states,” the resolution made at the meeting read in part.

Mr Patrick Ocailap, Uganda’s Deputy Secretary to the Treasury, who represented Finance Minister Matia Kasaija stressed that financing of the development infrastructure of the partner states through Public Private Partnerships (PPPs) will stop countries from overreliance on debt financing.

“What I need you to appreciate is that we are starting from a slightly weaker private sector in most of these investments such as oil and gas. Specifically, the way we are maximizing private sector participation is one step at a time. It is the intention of this cluster to engage the private sector in East Africa, make them gain knowledge; make them gain what it takes for them to participate in the area,” he explained.

This comes after Uganda signed an agreement with a Turkish firm for the construction of the 272km SGR line from Malaba to Kampala at a cost of Shs10.8 trillion, which will be borrowed from Citibank.
However, under the public-private partnerships, such projects would be funded by private firms and then allow the government or users to pay back over a longer period or even the project’s lifetime.

Mr Ocailap explained: “We now have the capacity to help the private sector here, under a public sector institution called NPA [National Planning Authority], to help them prepare on how they can use their financial mass of mobilising money, or the public can mobilise money and give it to them; that’s the way we can build the private sector capacity in these areas.”
Ms Elizabeth Shungula, who represented the Kenya Cabinet Secretary at the summit, acknowledged the opportunity presented to partner states to collaborate in mobilizsng private sector financing for infrastructure development in alignment with the objectives of NCIPs.

Of special note was the growing partnership with the private sector, which, she said, was playing a key role in NCIP initiatives such as efforts to enhance the interoperability of payment systems across partner states, a crucial step towards advancing financial inclusion.

Mr Joseph Rutabana, the High Commissioner of Rwanda to Uganda, underscored the importance of implementing the regional projects and emphasised the significance of infrastructure development in presenting opportunities for economic growth and enhanced regional integration.

Mr Samuel Yanga Mikaya, who represented South Sudan at the summit, highlighted the transformative potential of the Northern Corridor Integration Projects for a shared vision of prosperity in the region. He pledged that the Government of South Sudan would work on all legal procedures to ensure the requisite framework is in place for the operationalization of protocols under the Finance and Private Sector Participation Cluster before the next Summit of NCIPs.