President Yoweri Museveni has praised the Chinese government for extending loans to Uganda and Africa where other development partners have been hesitant.
Museveni was fielding questions at a press conference that he jointly addressed with visiting Zimbabwean President Emmerson Mnangagwa at State House Entebbe ahead of today’s Independence Day celebrations.
Responding to questions from journalists on Uganda borrowing a lot of expensive loans for infrastructure development, Museveni said China is giving Uganda loans for infrastructure projects previously neglected by other partners. According to Museveni, this has enabled Uganda to use its money for other things, and at the same time use the loans which have a longer repayment period for development.
He said the country’s loan ceiling is still manageable and there is no cause for alarm. The president also said in order to develop the economy, factors that influence the cost of production like transport, high-interest rates and electricity need to be addressed.
He said China is the only partner that has agreed to lend Uganda, Kenya and Tanzania to construct the railway and roads.
"The Chinese whom you [journalists] seem to be very excited against because you’re being influenced by some other people, are the only ones who have agreed to lend us money to develop the railway in Kenya and in Tanzania, to develop the electricity. On the issue of the cost of money, we’re doing it ourselves. But even for the railway, we would have done it ourselves but if there is a loan, then I take advantage of it and then I use my own money to do other things. Now, are we borrowing too much? No." said Museveni.
According to the International Monetary Fund (IMF) and World Bank, Africa is heading towards a debt crisis. Uganda's debt has hit Shs 42 trillion. Like most African countries, China is the largest creditor to Uganda, disbursing 39 per cent of the total credit in the financial year 2017/2018, surpassing the traditional creditors such as the World Bank (21 per cent) and the African Development Bank (8 per cent).
In his speech, Mnangagwa, thanked Museveni for honouring him to preside over this year’s Independence celebrations, saying Southern Africa has a lot to learn from Uganda and East Africa. According to Mnangagwa, when Uganda got independence early in 1962, it inspired some Southern African countries to push for the same.
He, however, said that as Zimbabawe, they have been surviving by themselves without any support from foreigners. Mnangagwa noted that the numerous sanctions imposed on the country have been a big problem to the country’s economy. He, however, said they are moving towards finding African solutions to African problems.
He praised Uganda for contributing to the development of Southern Africa materially and intellectually, adding that several members of his cabinet are graduates of Makerere University.
"Independence was to have Africa free to have the economic freedom, but today we now have a duty as the current crop of leadership in Africa to develop our countries. To improve the standard of life of our people. To trade amongst ourselves, to modernize all aspects of life to ourselves. Our task now is to cooperate and modernize our respective countries." said Mnangagwa.
The two leaders also signed a joint communiqué and agreed that sanctions against Zimbabwe be lifted immediately.