Narrative
Full Description
Project narrative
On September 9, 2011, the Chinese Government and the Government of Uganda signed a preferential loan framework agreement for Phase 2 of the Equipment Supply to Local Governments Project. Then, on October 20, 2011, China Eximbank and the Government of Uganda signed an RMB 670,000,000 ($104,949,874.69) government concessional loan (GCL) agreement [GCL NO. (2011) 8 TOTAL NO. (359) SERIES NO.: 1420303032011110198] for Phase 2 of the Equipment Supply to Local Governments Project. The borrowing terms of the GCL were as follows: a 20 year maturity, a 5 year grace period, a 2% interest rate, a 0% default (penalty) interest rate, a 1% (RMB 6,700,000) management fee, and a 0.75% commitment fee. The proceeds of the GCL were to be used by the borrower to finance a $100,000,000 commercial contract [F.A.W/UG/MOF/10F] between the Government of Uganda’s Ministry of Finance, Planning, and Economic Development and China FAW Group Import & Export Co, Ltd., which was signed on May 14, 2010. According to the Government of Uganda’s Aid Management Platform (AMP), this loan achieved a 95.3% disbursement rate, with China Eximbank making 5 loan disbursements (worth $100,119,280.46) between 2012 and 2013: a $50,116,650.84 disbursement on January 13, 2012, a $27,417,589.61 disbursement on June 25, 2012, a $5,896,443.57 disbursement on December 18, 2012, a $6,688,214.65 disbursement on July 26, 2013, and a $10,000,381.79 disbursement on October 11, 2013. According to the Uganda Ministry of Finance, Planning, and Economic Development's Report on Public Debt, Grants, Guarantees and Other Financial Liabilities for Financial Year 2021/2022, as of December 31, 2021, total loan disbursements amounted to $99,094,611.37 and the loan’s amount outstanding (including arrears) was $66,063,075.41. The purpose of this project was to procure 1400 pieces of road equipment -- including 159 graders, 257 tipper trucks, 12 wheel loaders, six dozers, seven excavators and two loaders--for 121 districts and 22 municipalities around the country. Project implementation officially commenced on June 18, 2012 and concluded on or around May 25, 2013. The originally expected project completion date was December 31, 2013. As early as October 2013, complaints arose from local governments about the quality and ineffectiveness of the graders.
Staff comments
1. This project is also known as the Uganda Equipments Supply to Local Government Project (Phase 2), the Equipment Supply to Local Governments 2 Project, and the Road Construction Equipment Project. The Chinese project title is 坎帕拉市政工程设备项目 or 1400台套的市政工程设备. 2. One source refers to the face value of the China Eximbank loan as RMB 631,034,482. AidData relies on the face value of the loan (RMB 240,000,000) as recorded in the actual GCL agreement [CHINA EXIMBANK GCL N0. (2007) 23 TOTAL NO. 194]. 3. The May 14, 2010 commercial contract is also known as the Contract for Supply Assorted Road, Sanitary and Fire Fighting Equipment for Municipalities, Towns and Districts of Uganda. 4. The Government of Uganda’s agreement code for the GCL agreement is L-0608. The system identification number in the Government of Uganda’s Aid Management Platform (AMP) is 87299311772. 5. The China Eximbank loan (GCL) agreement can be accessed in its entirety via https://www.dropbox.com/s/7comfnarw4z3924/Equipment%20Supply%20to%20Local%20Governments%20Project%20%28Phase%202%29.pdf?dl=0.”