Despite the current economic hardships in Europe, the Western donors have continued to provide development aid to Uganda, with Germany and France providing 110 million Euros (Shs417b) for electricity project in western Uganda to foster national development.

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KAMPALA – Despite the current economic hardships in Europe, the Western donors have continued to provide development aid to Uganda, with Germany and France providing 110 million Euros (Shs417b) for electricity project in western Uganda to foster national development.

Muzizi hydropower Project (HPP) is being developed at the lower course of the Muzizi River, south east of Lake Albert located in Kibaale District, western Uganda.

However, government officials say the project footprint will extend to districts of Kabarole, Kyenjojo and Ntoroko. It is designed as a run-of-the river power plant with an installed capacity of 44.7 MW and a total annual energy production of 220GWh when completed.

Speaking the during the signing ceremony between Uganda, Germany and France in Kampala last Friday, Finance minister, Mr Matia Kasaija, said the total project cost is estimated at 110 million Euros, out of which KfW of Germany is providing 40 million Euros while French Development Agency (AFD), is providing 45 million Euros. At the same time KfW will provide grant funding of 5.25 million Euros.

Mr Kasaija said the Finance ministry has committed to provide counterpart funds for both on-going projects and projects to come on board.

He added: “I want to caution Uganda Electricity Generation Company Limited to make sure that the purpose of these funds is realised.
Uganda borrows from Western donors mainly on concessional basis which loans are cheaper to service because they attract zero interest rates.

Speaking on the behalf of the donors, French ambassador to Uganda, Ms Stephanie Rivoal, said:

“The objective of the project is to meet the energy needs of Uganda’s population for social and economic development and improve the quality and security of power supply in the country.”

Source: Daily Monitor

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