Uganda secures $540 million World Bank Funding to transform cities and municipalities

7 April 2026, 1:39 pm

By Edwin Okurmu Kisa

The Government of Uganda has secured funding of USD 540 million (approximately UGX 2.1 trillion) from the World Bank to support the development of cities and municipalities across the country under a new phase of urban transformation.

The funding, which includes an USD 80 million grant component, will finance the second phase of the Uganda Support to Municipal Infrastructure Development (USMID) programme, now rebranded as the Uganda Cities and Municipalities Infrastructure Development Programme (UCMID).

This marks the second time the World Bank has supported the initiative, which has already delivered significant improvements in urban areas, including the construction of modern roads, upgraded drainage systems, and the development of modern markets, among other infrastructure projects.

According to the Minister for Lands, Housing and Urban Development, Judith Nabakooba, the new programme will run for six years, from the 2026/2027 financial year to 2030/2031, and will be coordinated by her ministry.

She revealed this during a press briefing at the Media Centre in Kampala, noting that the programme is designed to strengthen the institutional performance of selected urban local governments and improve urban planning and management.

The UCMID programme will also focus on expanding access to climate-smart infrastructure, services, and job opportunities, particularly benefiting urban residents and displaced populations in refugee-hosting areas.

Implementation will cover 10 regional cities, 26 municipalities, and 13 refugee-hosting districts, directly benefiting an estimated 5.6 million people, including around 1.6 million individuals living in refugee-hosting communities.

The targeted cities include Lira, Arua, Gulu, Soroti, Mbale, Hoima, Fort Portal, Jinja, Mbarara, and Masaka, while the municipalities span different regions, including both those previously under USMID and newly added ones.

The programme will also be implemented in refugee-hosting districts such as Arua, Yumbe, Adjumani, Lamwo, Kiryandongo, and Isingiro, among others.

Beyond infrastructure, the initiative will promote environmental sustainability through tree planting in urban areas, improve safety and stability with the installation of street lighting, and enhance economic opportunities.

By the end of the programme, the government projects that at least 20,000 permanent jobs will be created, including 5,000 targeting refugees and host communities, particularly in sectors such as market operations, waste management, maintenance services, and logistics.

Officials say improved infrastructure and better market access are expected to lower business costs, boost demand for labour, and increase household incomes, especially for women, youth, and low-income earners, while also creating a more supportive environment for small businesses, vendors, and informal traders.