UGX 340 billion secured for water infrastructure and urban development in GKMA

14 March 2025, 10:39 am

By Ronald Ssemagonja

Minister of Finance, Planning and Economic Development, Matia Kasaija has announced that the country has secured a loan of €85, approximately Uganda Shillings 340 billion from France. The loans were signed by the minister on behalf of Uganda and AFD Regional Director, Jean François Arnal at the ministry headquarters in Kampala.

According to the Minister, the loans will cater for water infrastructure and broader urban development in Greater Kampala Metropolitan Area (GKMA). In his address Kasaija acknowledged the strain on Kampala’s water services due to rapid urbanization and industrial growth. “Water supply services in Kampala and surrounding areas have been constrained,” He said.

The minister says that specifically, €45 million (approximately UGX 180 billion) of the total funding will support the second phase of the Kampala Water Lake Victoria Water and Sanitation Project. This will expand the water supply network, building upon previous phases that upgraded the Ggaba water treatment complex and constructed a new treatment plant at Katosi. “This funding will enable us to increase coverage of the intervention, develop the downstream part of the water supply network, and enhance access to safe water for the residents of the Greater Kampala Metropolitan Area.” Kasaija stated.

Kasaija also reiterated the fundamental right to clean water and Uganda’s aim to achieve 100% piped water access by 2040. The remaining €40 million (approximately UGX 160 billion) will fund the Greater Kampala Metropolitan Area Urban Development Program, strengthening the capacity of the ministry of Kampala Capital City and Metropolitan Affairs and the Kampala Capital City Authority to deliver coordinated infrastructure and services. This portion of the funding will focus on broader urban development needs beyond just water infrastructure. “This financing is timely, as it fits into our strategic aspirations of growing the size of our economy tenfold from the current GDP of $53 billion to $500 billion by 2040.” He said.

On behalf of the ministry, Kasaija pledged full accountability for the funds. “We will ensure that the funds are properly and exclusively utilized by the agencies for the activities earmarked.” He assured, adding that regular progress reports would be provided to development partners.

The minister of state for water and environment, Beatrice Anywar, in her remarks, emphasized the importance of ensuring that water reaches the end-users, and the funding will support the expansion of the water network, restructuring, and rezoning. “We have water, but how do we make sure it reaches the end-users? We are grateful for the support, but we are also looking forward to expanding our partnership to other areas, including Masaka and beyond.” She said.

Additionally, the government has requested further funding of 150 million euros to support the expansion of clean water services. The minister also emphasized the need for Ugandans to protect their water sources by avoiding activities that contaminate or destroy them. “I direct Ugandans to vacate wetlands. Let’s take responsibility to make sure that we protect our water sources; that we don’t dump wastes to contaminate our water source. Our water source is wealth that must be protected by all Ugandans. People should stop tampering with the catchment area of our water sources, including Lake Victoria. Let’s protect our environment. It sustains the water sources.” she emphasized.

The €45 million soft loan will specifically fund the rehabilitation and extension of the water distribution network in North Kampala, benefiting an additional 1 million people, and include the installation of 2,600 prepaid meters in informal areas. In the same manner, the French Ambassador to Uganda, Xavier Sticker, highlighted his country’s commitment to improving Uganda’s water supply through key investments and French expertise. “This project is a testament of the enduring and strong friendship and cooperation between our two countries.” He said.

Regional director of AFD Jean-François Arnal emphasized the agency’s support for Uganda’s Vision 2040 and National Development Plan IV. “I am very honored, as AFD Regional director, to come and sign the first AFD loans to the Government of Uganda since September 2021.” He said. Noting that over €400 million in ongoing projects and €300 million in planned pipeline projects. He also highlighted the importance of the urban development project, which will prioritize climate-resilient urban infrastructure investments.

“Considering Uganda’s location, the impact of climate change in urban areas are expected to manifest with an increase unpredictability of rainfall with more frequent and intense rainfall extremes that often result in flooding. The co-financing from AFD in form of €40m is prioritising urban infrastructure investments that build the resilience of the cities against these effects of climate change.” He said.

This AFD financed project, will increase water production to 240 million liters per day, up from the current 160 million liters. The loan will be on-granted to the National Water and Sewerage Corporation (NWSC). The NWSC managing director Eng. Dr. Silver Mugisha said that the project aims to address water supply challenges. “When we finish Katosi, Sonde, and Naguru, we will have the capacity to produce sufficient water and bring it to the reservoirs. We need to increase production to 240 million liters per day, as the intake is 240 million liters per day, but the treatment plant can only handle 160 million liters.” He explained. The minister for Kampala and Metropolitan affairs, Hon. Minsa Kabanda witnessed the signing.