World Bank Discusses New Country Assistance Strategy for Uganda

May 25, 2010

WASHINGTON, May 25, 2010 - The World Bank Board of Executive Directors today discussed a new Country Assistance Strategy (CAS) that will support Uganda’s National Development Plan (NDP) to help transform the economy.

Acknowledging that Ugandan authorities had successfully maintained macroeconomic stability and pursued reforms leading to impressive growth and poverty reduction over the past two decades, the Directors also noted that Uganda still faces important challenges to accelerate structural transformation, including sizable infrastructure constraints, high population growth, regional disparities, and weaknesses in governance and service delivery.

The five-year CAS covering the fiscal years 2011-2015 succeeds the Uganda Joint Assistance Strategy (UJAS). Hinged on four pillars, the new CAS will support Government efforts to promote inclusive and sustainable economic growth; enhance public infrastructure; strengthen human capital development; and improve good governance and value for money.

It is estimated that during the CAS period, the International Development Association – the arm of the Bank that lends to the poorest countries – will commit an estimated US$1.97 billion to support development projects and programs in Uganda.

“This new CAS coincides with a window of opportunity for Uganda to lay the groundwork for effective and transparent management of its future oil wealth, improving service delivery, and addressing infrastructure bottlenecks that would impede future growth,” said Kundhavi Kadiresan, World Bank Country Manager for Uganda.

On oil, the Directors emphasized that it brings both opportunities and challenges, and encouraged the Bank to work with development partners to assist the Government put in place the appropriate framework to avoid the oil curse. They emphasized the importance of strengthening the governance environment, noting that oil revenues can exacerbate corruption. However, the Directors noted positively that the CAS focuses on interventions that promote governance and value for money in the context of partnership with civil society organizations and donors.

The discussion of the Uganda CAS comes after the Board’s approval on April 20 of the World Bank-International Monetary Fund Joint Staff Advisory Note (JSAN) ― an assessment of the National Development Plan prepared to inform the Boards of the two institutions on the priority areas for strengthening the poverty reduction strategy and its implementation. The Directors called for more efforts in domestic revenue mobilization, greater private sector participation, more attention to gender issues and commitment to improve governance and institutional capacity.

The process leading up to the new CAS was characterized by multi-stakeholder consultations including with key Government institutions, parliamentarians, civil society organizations, media, academia, private sector, and social accountability agencies.

The World Bank has provided close to US$6.5 billion in loans and grants to Uganda since 1963, and has already committed US$1.2 billion to finance various programs and projects between 2009 and 2011. The Bank’s current portfolio in Uganda consists of 17 projects with a commitment of US$1.43 billion.

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