It was gathered that President Yoweri Museveni had on Tuesday, 17 November 2015, signed an agreement with Export-Import Bank of China (Exim Bank) to borrow $207 million at two percent upon disbursement.
The loan had a maturity period of 20 years including a seven-year grace period, but It has now emerged that the deal signed with the Chinese lenders virtually means Uganda “surrendered” its most prominent and only international airport.
The Uganda Civil Aviation Authority (UCAA) says some provisions in the Financing Agreement with China expose Entebbe International Airport and other Ugandan assets to be attached and taken over by Chinese lenders upon arbitration in Beijing.
It also emerged that China has rejected recent pleas by Uganda to renegotiate the toxic clauses of the 2015 loan, leaving Ugandan President Yoweri Museveni’s administration in limbo.
According to the Daily Monitor, the Ugandan government waived international immunity in the agreement it signed to secure the loans, exposing Entebbe International Airport to take over without international protection.
In desperation, Uganda in March 2021 sent a delegation to Beijing hoping to renegotiate the toxic clauses of the deal but the officials came back empty-handed as China would not allow the terms of the original deal to be varied.
Last week, Uganda’s Finance Minister Matia Kasaija apologized to parliament for the “mishandling of the $207 million loan” from the China Exim Bank to expand Entebbe International Airport.
Progress of works at the airport, built in 1972, has reached 75.2 percent, with two runways having reached overall completion of 100 percent.
Entebbe International Airport is Uganda’s only international airport and handles over 1.9 million passengers per year.
Its seizure by China would greatly dent the legacy of the 77-year-old Museveni, who came to power on the back of an armed uprising in 1986, and expose him to election defeat.
KanyiDaily recalls that the World Bank had recently revealed that the Nigerian Government is owing China the sum of $3.121 billion (N1,126.68 trillion at USD/N361) as of March last year.
The World Bank said that the total amount represents only 3.94 percent of Nigeria’s total public debt of $79.21 billion as of September 2021.