On Tuesday, November 17, 2015, the Ugandan government signed an agreement with the Export-Import Bank of China (Exim Bank) to borrow $ 207 million at two percent at the time of disbursement. The loan had a 20-year maturity period, including a seven-year grace period.
The Uganda Civil Aviation Authority (UCAA) says that some provisions of the Financing Agreement with China expose Entebbe International Airport and other Ugandan assets to being seized and assumed by Chinese lenders following arbitration in Beijing.
According to the Daily Monitor, the Ugandan government waived international immunity in the agreement it signed to guarantee the loans, exposing Entebbe International Airport to take over without international protection.
In March, a desperate Uganda sent a delegation to Beijing in hopes of renegotiating the toxic clauses of the deal, but officials came back empty-handed as China would not allow the terms of the original deal to be changed.
Last week, Ugandan Finance Minister Matia Kasaija apologized to parliament for the “mishandling of the $ 207 million loan” from China Exim Bank to expand Entebbe International Airport.
The progress of the works at the airport, built in 1972, has reached 75.2 percent, with two runways having reached a total completion of 100 percent.
Entebbe International Airport is Uganda’s only international airport, handling more than 1.9 million passengers a year. Its takeover by China would greatly damage the legacy of the 77-year-old Museveni, who came to power after an armed uprising in 1986, and expose him to electoral defeat.
Source Credit: TheGuardian
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