UK government eyes financing Uganda’s car making industry

UK Trade Envoy to Uganda Lord Dollar Popat on Monday November 15 met Dr Monica Musenero, Uganda’s Minister of Science to discuss potential UK Export Finance (UKEF) funding for the development of the Kiira Vehicle Plant at Jinja Industrial Area.  The two discussed how the UKEF, the UK government’s export credit agency, can support Uganda’s industrialization agenda. The UKEF is the world’s first export credit agency which helps exporters access finance and insurance in the absence of private sector risk capacity.

Construction of the plant in Jinja started in February 2019, undertaken by the National Enterprise Corporation, the commercial arm of the Uganda People’s Defence Forces. The plant is designed with the capacity to produce 5,000 vehicles annually. Government says the construction project of the Kiira Motors Vehicle plant has reached 75%. It is planned that Kiira Motors Corporation will initially make buses and trucks so as to facilitate public transportation in the country.

The UK government last year decided to boost trade with Uganda increasing funding by more than 200% from £600 million to £2 billion through the UKEF. This followed an announcement by the UK’s Minister for Exports Graham Stuart, stating that the government had chosen to support diverse international projects in Uganda, Egypt, Paraguay, Serbia and Vietnam.

In June of the same year, the UKEF announced financing to support the Kampala Industrial and Business Park (KIBP) project in Uganda. The financial support has a total value of approximately 220 million euros (USD 250 million) and aims to support a UK exporter company’s (Lagan-Dott Namanve Ltd) construction services in connection with the project.

The project is being developed by the Uganda Investment Authority in partnership with Lagan-Dott Namanve Ltd and will provide construction services for the project through a design and build contract. The main elements of the project include road infrastructure, water supply infrastructure, solid waste, and wastewater infrastructure, power supply and communications, and ancillary infrastructure.

Lord Popat and the British High Commissioner to Uganda, Kate Airey on Tuesday made their maiden visit to KIBP since the commencement of the Infrastructure Development Project in July 2020.

It is expected that the industrial park, in addition to creating over 200,000 jobs for Ugandans, will contribute to import substitution and boost exports.

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