Local governments across the country continue to struggle with funding for infrastructure development. The government of Uganda has been exploring ways to enhance the financial autonomy of local governments, including improving their capacity to borrow responsibly for development projects. This includes capacity-building initiatives and reforms to streamline the borrowing process albeit with little success. This is because of the stringent laws surrounding borrowing as well as the local government’s creditworthiness, which is influenced by factors such as revenue collection efficiency and financial management practices, affects its ability to borrow and the terms of borrowing.
It is against this background that researchers from the School of Business partnered with United nations Capital Development Fund to undertake a study on “Enabling new Cites to Access Private Capital for Local Investments.” The research team, led by Dr. Yusuf Kiwala, who undertook a study of Arua and Mbale city, have proposed a framework, which if adopted could help local government address their development challenges.
In a groundbreaking move, local governments in Uganda are set to revolutionize their approach to funding infrastructure projects with the introduction of a comprehensive financing framework. This new strategy aims to enhance collaboration between public and private sectors, ensuring sustainable development across the country.
Speaking during the dissemination workshop in Mbale City on August 1, 2024, Dr Kiwala while unveiling the framework said the new financing framework is built on several key elements, each designed to address specific aspects of funding infrastructure projects. These elements include the contribution of resources by various actors, diverse funding sources, external triggers of change, financing instruments, and financing structures.
Actors Contributing Resources: The framework emphasizes collaboration and community engagement. It involves a range of stakeholders, including government entities, private investors, and commercial lenders, working together to pool resources and share risks.
Funding Sources: The framework taps into multiple funding sources, both public and private. National, international, and local governments, along with donors and impact investors, are expected to play significant roles in financing infrastructure initiatives.
External Triggers of Change: This element focuses on the various external factors that can initiate or accelerate infrastructure projects. These include regulatory changes, market forces, economic incentives, and financial reforms.
Financing Instruments: A variety of financing instruments are available under the framework. These include grants, equity investments, short-term and long-term loans, user fees, loan rebates, bonds, and guarantees. This diversity allows for flexibility and adaptability in funding approaches.
Financing Structures: The framework incorporates innovative financing structures such as pooled finance, special purpose vehicles, revolving funds, project finance, public-private partnerships (PPPs), and leasing arrangements. These structures are designed to enhance financial stability and efficiency in project implementation.
The new framework outlines specific mechanisms to operationalize these elements. These mechanisms include:
Collaboration and community engagement to foster collective ownership of projects.
Funding from a mix of government sources, donors, and commercial lenders.
Regulatory and market-driven changes that create conducive environments for infrastructure investments.
A wide range of financial instruments to meet the diverse needs of projects.
Structured financing options to ensure robust and sustainable funding models.
Impact and Future Prospects
This innovative financing framework is poised to transform the landscape of infrastructure development in Uganda. By leveraging diverse funding sources and adopting flexible financing structures, local governments will be better equipped to undertake critical infrastructure projects that drive economic growth and improve public services.
The introduction of this framework also signals a shift towards more inclusive and sustainable development practices. With community engagement and risk-sharing at its core, the framework ensures that infrastructure projects are not only financially viable but also socially equitable.
As Uganda embarks on this new path, the success of the financing framework will likely serve as a model for other developing countries facing similar challenges in funding infrastructure development. The future looks promising as local governments, in collaboration with various stakeholders, pave the way for a brighter and more prosperous Uganda.
The Principal Assistant Town clerk – Northern Division, Ms. Annet Nandudu, expressed optimism for the future, saying that with continued collaboration and strategic planning, the challenges can be overcome. Ms. Nandudu the importance of transparency and accountability in the financing framework to ensure that resources are utilized efficiently and effectively. She also highlighted the need for ongoing capacity building to strengthen local government institutions and empower communities to participate in decision-making processes.
On his part, Mr. Julius Masereka, Principal Urban Officer, Ministry of Local Government, said the government was committed to the successful implementation of such initiatives. He emphasized the importance of collaboration between the government and local communities to ensure sustainable development. He called on the LGs to write bankable projects so that they can access funding from various sources and contribute to the overall development of their communities.
Research team
Dr. Yusuf Kiwala Mr. Kanakulya Ronald Ms. Maureen Nandaula Dr. Kintu Ismail
Over 30 Stakeholders from Uganda’s transport and energy sectors convened at the Kolping Hotel, Kampala, for a workshop aimed at accelerating the adoption of electric mobility (e-mobility) as a strategy for reducing emissions and improving energy efficiency. Organized by the Environment for Development (EfD)-Mak Centre, the workshop brought together researchers, policymakers, transport operators and users, as well as private sector players to address challenges and opportunities in Uganda’s e-mobility transition.
Promoting Energy Efficiency and Reduced Emissions
The workshop, led by Dr. Peter Babyenda, Policy Engagement Specialist at EfD-Mak, centered on the theme “Energy Efficiency and Reduced Emissions in Uganda’s Transport Sector.” Dr. Babyenda highlighted the environmental and economic importance of transitioning to e-mobility, stating, “Transforming Uganda into a modern society as envisioned under Vision 2040 demands that we address the environmental challenges in the transport sector, a major carbon emitter.”
The agenda included discussions on the status of energy efficiency, the role of women in e-mobility, and strategies to promote the adoption of electric motorcycles and buses.
Rising Numbers and the E-Mobility Transition
According to survey findings by the EfD researchers, Uganda’s transport sector has seen an unprecedented rise in vehicle and motorcycle usage. The number of vehicles in the country has more than doubled, increasing from 739,036 in 2012 to 1,355,090 in 2018. Motorcycles have seen an even sharper increase, growing from 354,000 in 2010 to over one million by 2018. This growth has intensified emissions and air pollution, particularly in urban areas like Kampala, which was ranked the world’s fifth most polluted city in 2020.
Electric mobility is emerging as a viable solution. Over 400 electric motorcycles, introduced by private sector players such as Zembo, GOGO, and Spiro, are already on Uganda’s roads. These e-motorbikes offer cost savings on fuel and maintenance, zero emissions, and enhanced security. Dr. Babyenda described them as a step forward in reducing the sector’s environmental footprint, though he acknowledged the challenges of limited charging stations, counterfeit batteries, and insufficient awareness.
Government Policy and Infrastructure Development
Eng. David Birimumaso, Principal Energy Officer at the Ministry of Energy, detailed the government’s efforts to support e-mobility. These include developing charging infrastructure, establishing policies for electric vehicle adoption, and training technicians and operators.
“Transport contributes 16% of energy-related emissions,” said Eng. Birimumaso. “Through partnerships with private players like Zembo and Kiira Motors, we are promoting e-mobility by building charging stations and offering capacity-building programs for stakeholders. By 2030, we aim to ensure 100% electricity access, making e-mobility viable for all Ugandans.”
So far, the Ministry has piloted electric vehicle charging at Amber House in Kampala and supported the establishment of four charging stations along the Masaka Road corridor. These efforts are part of the broader energy policy, which emphasizes the transition to cleaner, more efficient energy sources.
Economic and Gender Inclusion in E-Mobility
The workshop also highlighted the importance of economic and gender inclusion in e-mobility. Dr. Babyenda noted that while women are increasingly involved, barriers such as cultural stigmas, inappropriate vehicle designs, and limited training opportunities persist.
“Encouraging women to take up roles as drivers and technicians in the e-mobility sector is essential for a holistic transition,” Dr. Babyenda remarked. Participants recommended vehicle redesigns to accommodate women and initiatives to encourage female participation in the sector.
Key Challenges and Recommendations
Despite the promise of e-mobility, several barriers hinder its widespread adoption in Uganda. One major challenge is the limited availability of charging stations and battery-swapping points, which restricts the operational range and convenience of electric vehicles. The prevalence of counterfeit batteries further undermines reliability, discouraging potential users. Additionally, the high upfront costs of electric vehicles and motorcycles present a significant financial barrier for many Ugandans. Insufficient public awareness and persistent misconceptions about e-mobility also contribute to slow adoption, highlighting the need for targeted education and sensitization campaigns.
To address these challenges, participants recommended expanding charging networks, introducing subsidies for electric vehicles, enforcing quality standards for batteries, and conducting nationwide sensitization campaigns. Hybrid vehicles were also suggested as a transitional solution to address range anxiety.
Workshop’s Relevance to National Goals
This workshop was part of the Inclusive Green Economy (IGE) program, a regional initiative funded by Sida through the University of Gothenburg, Sweden. Since its inception in 2020, the program has trained over 25 fellows across East Africa, focusing on green transitions and evidence-based policymaking.
The 2024 workshop theme aligns with Uganda’s Vision 2040 and the National Development Plan IV, which prioritize energy efficiency and emission reductions in the transport sector.
As the workshop concluded, stakeholders expressed optimism about Uganda’s e-mobility potential. Dr. Babyenda emphasized the importance of inclusivity, stating, “Achieving energy efficiency requires collective effort. We must involve everyone, from boda boda riders to policymakers, to ensure a successful transition to clean, efficient transport.”
With over 400 electric motorcycles on Uganda’s roads and a growing network of charging stations, the country is making strides in its journey toward sustainable mobility. However, much work remains to achieve widespread adoption and integration of e-mobility solutions. The workshop served as a vital platform for collaboration and innovation in this critical sector.
Jane Anyango is the Communication Officer at EfD Uganda
The Public Investment Management Centre of Excellence (PIMCoE), hosted by the College of Business and Management Sciences at Makerere University, successfully concluded the training of its 4th cohort of public officers on November 15, 2024. This capacity-building program focused on the User Acceptance Training on Guidelines for Clearance of Financial Implications, a critical process mandated by Section 76 of the Public Finance Management Act (PFMA), 2015.
Under the PFMA, every bill presented to Parliament must include a Certificate of Financial Implications (CFI) issued by the Ministry of Finance, Planning and Economic Development (MoFPED). The preparation of the Statement of Financial Implications (SFI), which forms the basis for the CFI, is the responsibility of Ministries, Departments, and Agencies (MDAs). This statement provides detailed revenue and expenditure estimates and projected savings over a minimum of two years’ post-enactment.
Empowering MDAs with Essential Skills
The training sessions, which began last week and will continue into the following week, aim to equip MDAs with the skills required to prepare robust SFIs. These competencies are essential for MoFPED Budget Analysts to review and draft CFIs or Letters of Financial Clearance effectively.
The 4th cohort comprised officers from key institutions, including the Ministry of Lands, Ministry of Agriculture, National Environmental Management Authority (NEMA), Uganda Land Commission, Ministry of Local Government, National Agricultural Research Organization (NARO), and the Ministry of Kampala, among others.
A Step Toward Transparent and Accountable Governance
Speaking at the closing ceremony, Mr. Moses Sonko, Principal Economist at MoFPED, commended the initiative and acknowledged the value it brings to Uganda’s public policy and legislative processes. Representing the Permanent Secretary of MoFPED, Mr. Sonko highlighted the importance of the training in strengthening governance frameworks.
“This training was developed to equip us with tools and knowledge essential for our roles in ensuring that Uganda’s policy and legislative proposals are financially sound, transparent, and align with national priorities,” Mr. Sonko remarked. He encouraged participants to apply their newly acquired skills to enhance policy preparation and implementation.
He also emphasized the multi-dimensional nature of the training, which enables officers to identify the financial, social, environmental, and economic impacts of proposed bills and policies.
Participant Feedback
Participants expressed their enthusiasm and gratitude for the training. Mr. Davis Kwizera from the National Animal Genetic Resources Centre and Data Bank (NAGRC&DB) shared his positive experience, stating: “This training has offered a wealth of knowledge and an in-depth understanding of policy processes. It will significantly enhance our ability to prepare relevant policy documents. If you’ve taken the courses on Financial and Risk Analysis as well as Investment Appraisal and Risk Analysis, this program completes the package.”
The new guidelines for the clearance of financial implications will officially take effect in July 2025. PIMCoE remains committed to building the capacity of public officers to ensure that Uganda’s legislative and policy frameworks are underpinned by sound financial and risk analyses, fostering a culture of accountability and sustainable development.
For more updates on PIMCoE programs and upcoming training sessions, visit PIMCoE’s official website.
In a pivotal workshop held at Makerere University on November 12, stakeholders, researchers, and policymakers gathered to discuss the progress and emerging issues in the implementation of Uganda’s Parish Development Model (PDM). This transformative model, conceptualized by Prof. Ezra Suruma, aims to tackle some of Uganda’s most pressing socio-economic challenges: poverty, unemployment, and limited access to essential services, particularly in healthcare and agriculture.
Prof. Suruma, the architect of PDM, underscored the crucial role of researchers in creating wealth-empowering strategies for Ugandans. “The PDM is designed to eradicate poverty, promote economic inclusion, improve service delivery, and modernize agriculture,” Prof. Suruma stated. He highlighted that the model not only provides a pathway for Uganda’s rural households to participate in the economy but also aims to address the underlying issues that leave many citizens unable to afford basic needs.
The Vice Chancellor of Makerere University, Prof. Barnabas Nawangwe, commended Prof. Suruma’s visionary leadership and the significant impact PDM is expected to have on communities across Uganda. “The PDM stands as one of the largest government interventions aimed at eradicating poverty and uplifting communities,” he remarked. Prof. Nawangwe also emphasized Makerere University’s commitment to supporting PDM through the PDM Lab hosted by the College of Business and Management Sciences (CoBAMS), which serves as a hub for real-time data analysis to guide the implementation of PDM activities across the country.
The PDM Lab at CoBAMS, led by Prof. Eria Hisali and funded by the United Nations Development Programme (UNDP), is instrumental in collecting, analyzing, and interpreting data that can shape PDM policies at the grassroots level. During the workshop, Dr. Suruma extended his appreciation to UNDP for their support and acknowledged the researchers for their efforts in generating valuable insights into the effectiveness of PDM.
Despite Uganda’s notable economic growth in recent years, poverty remains a persistent challenge, with a significant portion of the population struggling to meet basic needs. Unemployment rates, especially among youth, are high, limiting economic opportunities for the country’s largest demographic. Access to healthcare, particularly in rural areas, is another critical issue, with many Ugandans unable to afford or reach essential medical services. These challenges underscore the need for initiatives like the PDM that are designed to create sustainable economic opportunities, improve household incomes, and ensure equitable access to services.
“PDM seeks to empower households to create wealth, ultimately reducing dependence on subsistence farming and encouraging local economic development,” Prof. Suruma emphasized. He believes that the model’s holistic approach will foster greater self-sufficiency among Uganda’s communities by addressing poverty from multiple angles, including agricultural modernization, financial literacy, and service accessibility.
As the workshop concluded, participants expressed optimism about PDM’s potential to drive sustainable change. Prof. Nawangwe reiterated Makerere University’s dedication to supporting this national initiative, affirming that the PDM Lab will continue to play a key role in assessing and enhancing the model’s effectiveness.
The Parish Development Model offers a beacon of hope for millions of Ugandans striving for a better quality of life, aligning with Uganda’s broader aspirations for economic growth, social equity, and sustainable development.