KAMPALA —The Uganda Civil Aviation Authority (UCAA) has dismissed claims that the Entebbe International Airport could be taken over by the Chinese government if the government defaulted on the expansion loan —noting that “it has not happened, and is not going to happen”.
Mr. Vianney Mpungu Luggya, the Manager Public Affairs at UCAA told this website that there is absolutely no risk of China or any other country to take over the Entebbe International Airport.
“We would like to make it categorically clear that the allegation that Entebbe International Airport has been given away for cash is false,” he said, adding Government cannot give away a national asset like an international airport”.
This comes after reports indicated that some of the unfavourable provisions in the $200m (Shs713b) loan picked to expand Entebbe International Airport that Uganda signed with the Export-Import (Exim) Bank of China on March 31, 2015, if not amended, expose Uganda’s sovereign assets to attachments and take-over upon arbitration awards in Beijing.
The airport, a strategic asset “has absolutely no adverse exposure to any lender,” said Mr. Luggya.
“We have said it before and repeat that it has not happened, and is not going to happen. There isn’t an ounce of truth in this, and it should be disregarded with the contempt it deserves”.
Mr. Luggya also dismissed reports that UCAA cannot use any of the accrued money for whatever expenditure without approval from Beijing saying that the authority still enjoys the freedom and liberty of spending what is collected on the account as per the budget noting that “no on controls our finances”.
“The lender’s monitoring of the account is only similar to what happens when one gets a salary loan or any other loan for that matter, and the bank requests that the salary is channeled through their bank. It does not mean that lending bank takes over your salary”.
He added: “The loan terms provide a grace period of 7 years, and we are still within that grace period during which only interest is paid, and government has not defaulted on those obligations”.
Progress of works at the airport has reached 75.2 per cent, with two runways 17/35 and 12/30 having reached overall completion of 100 per cent.
The phase one project that commenced on 10 May 2016, was expected to have been completed by 09 May 2021.
It was extended to 05 December 2022.
This is not the first project financed by China’s Exim Bank.
The bank has funded about 85 percent of two major Ugandan power projects — Karuma and Isimba dams.
The Chinese Bank also financed and built Kampala’s $476 million (Shs1.7 trillion) Entebbe Express Highway to Entebbe.
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