Uganda
Privatization and utility sector reform in Uganda supported

afrol.com, 25 August  - The World Bank today approved a US$ 48.5 million credit to assist the Republic of Uganda improve the quality, coverage and economic efficiency of commercial and utility services.

The Privatization and Utility Sector Reform Project will support the government's public enterprise sector reform and privatization program, which seeks to restructure and privatize state owned enterprises. This will be achieved through:

· Privatization of enterprises. This component will provide technical assistance to the government to prepare and implement the privatization of the remaining public enterprises;

· Strengthening of financial oversight of parastatals. This will build and strengthen the Parastatal Monitoring Unit institutional capacity to provide effective parastatal monitoring within the Ministry of Finance, Planning and Economic Development and;

· Utility Sector Reform. This will improve the quality, quantity and operation/delivery efficiency of a variety of services through stronger competition, enhanced regulatory framework and institutions, and new private participation in infrastructure.

At the beginning of the government's public enterprise sector reform and privatization program in 1992, the sector's performance was characterized by low productivity, high losses and rising debts, which placed a concurrent burden on the banking system, public finances and the balance of payments. The project will help stimulate private sector-led growth by improving the economic environment, encouraging private investment and increasing productivity. It will also increase the welfare of the population through increased quantity and improved quality of infrastructure services.

The Privatization and Utility Sector Reform Project will be financed by a US$48.5 million credit from the International Development Association, the World Bank's lending arm for the poorest countries. The IDA credit is on standard terms of 40 years maturity, including 10 years grace. The Government will finance the project with an additional US$46.80 million.

Source: World Bank

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