News
Jinja-Bukungu road upgrade to create alternative north-south route
Musasizi said the project remains economically viable, with an Economic Internal Rate of Return of 16.7%, above the 11% economic opportunity cost of capital.
Finance Minister Henry Musasizi addresses Parliament’s National Economy Committee on August 19, 2026, where he explained the reduction in the financing requirement for the Jinja-Mbulamuti-Kamuli-Bukungu Road project. (Courtesy: X/@Parliament_Ug)
By: Sarah Nabakooza, Journalist @New Vision
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Government is seeking approval to borrow €207.77 million (about sh842.71 billion) to upgrade the 127-kilometre Jinja-Mbulamuti-Kamuli-Bukungu Road and 10 kilometres of roads in Jinja city, a project expected to provide an alternative route between northern and southern Uganda.
Finance minister Henry Musasizi told Parliament’s National Economy Committee on August 19, 2026, that the revised financing requirement had been reduced by €22.68m (about sh92b) from the €230.45m Parliament approved in October 2025.
Musasizi, who appeared before the committee chaired by Avur Jane Pacuto (Pakwach), was accompanied by works and transport minister Fred Byamukama.
works and transport minister Fred Byamukama. (Courtesy: X/@Parliament_Ug)
The road starts in Jinja, runs through Mbulamuti and Kamuli, and continues to Bukungu on the shores of Lake Kyoga in Buyende district.
“The corridor will provide an alternative route linking northern and southern parts of the country and serve as a gateway to Amolatar, Kaberamaido, Soroti, Nakasongola and Kayunga. It will also include 10 kilometres of roads in Jinja city.
The reduction followed negotiations between the Ministries of Finance and Works and Transport, Citi Bank and the Africa Trade Investment Development Insurance (ATIDI), which resulted in lower financing requirements for the civil works and improved financing terms.
The change followed a revision to Sinosure's lending policy, which had initially been expected to provide insurance cover. Musasizi said Sinosure would finance only non-revenue or non-self-financing projects of no more than €100m, yet the road project required more than that.
The government subsequently engaged Citi Bank, the original arranger, with ATIDI taking over as the insurance provider.
Under the revised arrangement, Citi Bank will provide €179.26m (about sh719.79b) under an ATIDI-covered facility for the works, while €28.51m (about sh122.93b) will be obtained on commercial terms for land compensation and construction supervision.
The civil works contract, valued at €161.77m (about sh649.57b), was signed with M/S Power China International Group Limited on March 15, 2023, for the design and construction of the road and Jinja city roads.
The project financing includes €17.49m (about sh70.22b) for the ATIDI insurance premium, €26.17m (sh112.83b) for land acquisition and €2.34m (sh10.10b) for construction supervision and design review.
Musasizi said the project remains economically viable, with an Economic Internal Rate of Return of 16.7%, above the 11% economic opportunity cost of capital.
The government subsequently engaged Citi Bank, the original arranger, with ATIDI taking over as the insurance provider.
Under the revised arrangement, Citi Bank will provide €179.26m (about sh719.79b) under an ATIDI-covered facility for the works, while €28.51m (about sh122.93b) will be obtained on commercial terms for land compensation and construction supervision.
The civil works contract, valued at €161.77m (about sh649.57b), was signed with M/S Power China International Group Limited on March 15, 2023, for the design and construction of the road and Jinja city roads.
The project financing includes €17.49m (about sh70.22b) for the ATIDI insurance premium, €26.17m (sh112.83b) for land acquisition and €2.34m (sh10.10b) for construction supervision and design review.
Musasizi said the project remains economically viable, with an Economic Internal Rate of Return of 16.7%, above the 11% economic opportunity cost of capital.