Invest in infrastructure or forget about oil money - EU chief

By Billy Rwothungeyo

Unless Uganda invests in infrastructure, the eagerly anticipated oil and gas industry will not live up to its billing, Dr. Roberto Ridolfi, the head of the European Union (EU) delegation to Uganda has warned.

“Do not wait to invest in infrastructure in 20 years. Do it now. Build roads, railways, transmission lines, power generation dams and other essentials infrastructure for the country to run. This will then allow the private sector to prosper by reducing transaction costs,” Ridolfi cautioned.

He was addressing stakeholders at a networking event organised by the Uganda Chamber of Mines and Petroleum in conjunction with Citibank last week.

“There is an airplane on the runway, and the name is Uganda. Uganda is rolling with the engines, but if it does not reach take off speed, the airplane will crash. We really need to accelerate,” he said.

Ridolfi added that industrial development in agribusiness and oil and its products is the future for Uganda.

“In 10 years Uganda will need infrastructure. Without it, the products will not be competitive,” he said.

Ridolfi reiterated EU’s commitment to helping Uganda find funding for infrastructure projects.

He said the EU is keen on blending its grants with loans from the private sector to leverage investment amounts, but added that the integrity with which the Government acquires finances will also matter.

“Transparency in the way finances are acquired will mean cheap finance. If there is no transparency, funding will be expensive,” Ridolfi noted.

Irene Nakalyango, the Uganda Chamber of Mines and Petroleum chief executive officer, said the chamber has set up a taskforce to work with the education ministry to skill Ugandans for the petroleum and mining business.

“Vocational skills are important for the mining and oil and gas industry. We are targeting the much-needed professionals such as welders and engineers,” she said.

“A lot of exploration in mining needs to be done. We are also trying to bring international small companies on board to link them to local companies so that Ugandans can also participate,” Nakalyango said.

Chinedu Ikwudinma, the managing director of Citibank Uganda, said it is critical that the Government creates an enabling environment for investment.

“Policies have to be in place; otherwise attracting investments will be difficult. The policies have to be effectively implemented for each dollar to achieve the most,” he said.

Ikwudinma further said the long-term success of local content should be hinged on constructive partnerships with bigger global players.

“The key question is do we have enough professionals such as engineers and welders? As local capacity is being built, it is important that we work together with more experienced partners,” he said.