Kampala — The European Union has disbursed €20m (Shs84b) to Uganda towards budget support for 2019/2020 Financial Year.
The money is part of €66m (about Shs277.7b) the EU approved last year after lifting the suspension of direct budget support to the country.
During the EU Day Celebrations on Thursday last week, the head of EU delegation to Uganda, Ambassador Attilio Pacifici, said the funds will go directly to budget support and government will account for the funds using the agreed mechanisms set in place.
"I am pleased to announce that we have just approved the disbursement of €20m (Shs84b). The Government will decide, within the Justice and Accountability sectors, how best to use this money, for instance to improve transparency in natural resources management; to verify the asset declarations of senior officials; to reduce the backlog of court cases or else. A second payment, also of €20m could materialise this year if the objectives agreed in the Financing Agreement are achieved," Ambassador Pacifici said.
He also said discussions are already going on for the second phase of funds which are also expected to be released this year.
Ambassador Pacifici said the budget support is an indication of confidence in the Ugandan government. The EU suspended direct budget support in 2013 after gross corruption in the public sector.
"Last year we launched the first budget support programme since the suspension of this aid delivery mechanism in 2013. Providing budget support is for us the highest mark of trust for a partner. Aid money is injected in the government's budget and is utilised and accounted for based on rules, processes and procedures of the partner country.
"This new programme supports the justice and accountability sectors in which needs are massive and resources are scarce," he added.
He said overall, the EU and its partner states provide up to €500m (Shs2.1t) to the government of Uganda for development and an additional €140m (Shs589b) for humanitarian responses to the country.
Gaps in development
Ambassador Pacifici also said while the National Development Plan III is being developed domestically, too much focus is on infrastructure, leaving the social sector, the economy and environment gapping for resources.
"I would like to share that preliminary discussions seem to indicate that the NDP III focuses a lot on infrastructure development while not recognising enough the importance of social sectors, economy and the environment. As recognised in Vison 2040, these are crucial themes for the future of Uganda and we are keen to contribute to the discussions leading to the finalisation of the NDP III."
The head of EU delegation also said for Africa to move forward, the concept of donor-recipient relationship should be abandoned. He said EU sees Africa as a strong trade partner to steer development. Mr Pacifici Africa and Europe are twin continents, noting that as population increases, more resources must be channelled for development.
He said the current trade agreements between Africa and EU should be developed into a single continent-to-continent free trade agreement.
Uganda's Prime Minister, Dr Ruhakana Rugunda said Uganda will continue to maintain the positive relationship with EU for mutual benefit of the two. He said Uganda as a country values the partnerships and will make sure the funds given are put to proper use.