New Era for Ugandan Railways: Landmark Financing Deal Secured

UGANDA: A significant financing deal worth $800 million has been inked by the Islamic Progress Bank too bolster the Standard gauge Railway and other key initiatives.

This three-year funding package includes $500 million from the IsDB, while both the Islamic Corporation for the Development of the Private Sector and International Islamic Trade Finance Corp are contributing $150 million each. Though, specific details regarding how much will go towards the railway project remain unclear.

The agreement was signed on May 21 during a side event at the IsDB Group’s 50th annual meetings in Algiers, with Ramathan Ggoobi, Permanent Secretary of uganda’s Ministry of finance, and Dr. Rami Ahmed, vice-President of IsDB. The ministry highlighted that enhancing climate-resilient transport and energy infrastructure is a top priority under their engagement framework.

This past March, Uganda’s government allocated $83 million to contractor Yapı Merkezi to kick off construction on a crucial segment—the Eastern Line—stretching 272 kilometers from Kampala to Malaba at the Kenyan border. This move aims to accelerate progress on Uganda’s SGR development compared to its neighbors Kenya and Tanzania.

The overall cost for this ambitious project is pegged at around $2.9 billion. Additional funding is anticipated from export credit agencies in Turkey, the UK, and China, with citibank facilitating loan arrangements.