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Aid theft: Uganda calls for donor's help

02 May 2013, 08:32

Dubai - Uganda wants foreign donors to help it tighten financial controls to prevent the mismanagement or theft that led them to halt aid payments, Prime Minister Amama Mbabazi told Reuters on Wednesday.

Foreign donors have withdrawn almost all direct budget support after allegations $13m was stolen by officials in the prime minister's office.

Mbabazi said the loss of aid would mean "some hardship" but would probably not stop the economy, east Africa's third largest, from growing faster in 2013 than last year.

He said he understood the anger felt by donors.

"Now we [want to] see them work with us to tighten the loopholes in the system so that they can be sure that the money from donors is safe in the hands of government bureaucrats," he said in Dubai, where he attended an African business forum.

Corruption is deeply entrenched in Uganda and President Yoweri Museveni's government has previously shown little appetite to crack down hard. But the prospect of a 93% cut in direct donor budget support, set out in a budget paper last month, may be changing attitudes.

Mbabazi said the government has hired consultants to prevent aid losses and expects donors to resume their support in the "near future".

He also said revenues from Uganda's oil finds, part of a string of discoveries in East Africa, could start flowing as early as 2016, although oil executives suggest a later date.

Uganda's economic growth rate, which the International Monetary Fund estimates at just over 4% in the budget year to June, will double by 2016 with the launch of an oil refinery with an initial processing capacity of 30 000 barrels per day, Mbabazi said.

"All the estimates are that everything should be ready and in place by 2016," he said of the refinery.

- Reuters


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