[Uganda] World Bank gives Uganda $135m to fight poverty

From The East African

By PAUL REDFERN
Special Correspondent

Uganda last week received two massive grants totalling $135 million from the World Bank to support the government's ongoing poverty strategy.

In contrast to other Western governments, which have been suspending or cutting aid to Kampala, the World Bank board approved the grant although it said that the funds would be less than originally intended because of ongoing budget concerns.

The new funds are part of the Uganda Joint Assistance Strategy (UJAS), based around a core strategy of seven development partners for 2005-09. The UJAS provides the basis for the partners' support for the implementation of the government's new Poverty Eradication Action Plan covering the rest of the decade.

It has been prepared collaboratively by the UJAS partners: African Development Bank, Germany, the Netherlands, Norway, Sweden, the United Kingdom's Department for International Development, and the World Bank Group.

The World Bank says that the UJAS "provides a useful strategic framework for dialogue, including issues of governance, corruption, and public financial management, while providing the space for each UJAS partner to exercise sufficient flexibility in its response to evolving trends, based on mandate and comparative advantage."

The World Bank's executive directors commended the Uganda Joint Assistance Strategy "for putting into practice the principles of the Rome and Paris Declaration on aid effectiveness."

A number the executive direc- tors also recommended that the UJAS serve as a "model" for achieving better co-ordination among development partners in support of the government's development goals.

They also welcomed the intentions of other international development partners to join the UJAS in the near future.

They commended Uganda on its "consistently good economic performance" but expressed "concern about aspects of political governance."

They agreed that the main economic challenge is to maintain high and widely shared growth, which will require addressing key constraints improving infrastructure, especially in rural areas, removing obstacles to private sector investment, and promoting faster regional and international integration.

The World Bank also urged the government to continue to strengthen its anti-corruption institutions and its systems of public financial management to reduce opportunities for corruption, intensify its efforts to bring peace and development to the north and adopt measures to address its exceptionally high population growth rate, which impedes progress toward its poverty reduction objectives and the Millennium Development Goals.

The World Bank directors, in approving the new funds, noted they were a 10 per cent reduction on what had been expected, in order to reflect their "concerns about expenditure overruns in the public administration budget."

They also expressed concern that this trend might further escalate during the current fiscal year if no initiatives are taken.