European Investment Bank eyes more investments in Uganda

EIB has supported  Eastern Africa Transport Corridor and Bujagali Hydroelectric Project

Kampala, Uganda | RONALD MUSOKE | A delegation from the European Investment Bank (EIB) has concluded a week-long (May 22-26) visit of Uganda that saw the bank’s representatives and senior officials from the government of Uganda and the private sector discuss various investment opportunities in the country.

The European Investment Bank (EIB) is the European Union’s long-term financing institution owned by its 27 member states. It finances sound investments contributing to EU policy goals. The Bank supports projects in four priority areas — infrastructure, innovation, climate and environment, and small and medium-sized enterprises.

Outside the EU, the Bank supports projects through its specialized and dedicated arm known as EIB Global. The EIB Global’s priority activities in Uganda address key challenges including supporting climate adaptation and mitigation projects that build the resilience of vulnerable communities and improving access to finance especially for the SMEs and micro-enterprises.

Kampala visit

Edward Claessen, the head of the European Investment Bank’s regional hub for Eastern Africa, led the delegation which held discussions on investments in the ministries of water, transport, energy, housing, finance and justice.

“Uganda has enormous potential, but faces huge investment needs. These have been worsened by the impact of COVID-19 pandemic, energy and inflation shocks triggered by Russia’s invasion of Ukraine,” Claessen said.

“The Ugandan government requires support of partners such as the EU and the EIB for economic recovery, sustained growth and job creation, funding and investment.”

The EIB Global has so far provided over €498 million (Approx. Shs 2 trillion) to Uganda through the financing of 31 projects primarily in support of the country’s private sector businesses, energy, water, sewerage, transport, industry, telecom, services, agriculture, fisheries and forestry.

Some prominent projects the EIB Global has supported recently include the Eastern Africa Transport Corridor project, the Bujagali Hydroelectric Project and the Lake Victoria water and sanitation project in Kampala.

Jan Sadek, the head of the European Union Delegation in Uganda applauded the EIB’s visit pointing out the importance that EIB Global which is part of #TeamEurope plays in fostering of sustainable growth in the country.

“The European Union’s cooperation with Uganda aims to respond to the country’s most pressing needs by supporting sustainable development through sound economic policies and good governance,” he said.

The EIB Global in partnership with various financial institutions in Uganda has in recent years provided over €203 million (Approx. Shs 815 billion) to support private sector businesses, targeting agriculture and gender-equality focused projects.

Apart from its public sector lending to governments, EIB Global recognizes that strong financial intermediaries are key to addressing market challenges and suboptimal investment situations. Accompanying technical assistance was also offered to their clients across a wide range of topics including risk management, product development, environmental and social assessment, financial literacy among others.

According to a statement from the EIB to The Independent on May 25, the EIB Global is keen to grow its investment portfolio in the country to support the European Union’s Global Gateway initiative of providing long-term financing and tackling investment gaps to accelerate high-impact projects that contribute to delivering sustainable development and are technically, socially and environmentally sound.

“EIB Global is building on its many years of experience and partnership with banks, microfinance institutions and equity funds by supporting their efforts to innovate and enhance the scope and inclusiveness of their outreach.”

“It also considers non-banking financial institutions, such as guarantee funds, leasing companies or fintechs, that have a financial model to enable greater outreach to underserved smaller businesses.”