UGANDA · INFRASTRUCTURE FINANCE

The OPEC Fund for International Development began appraising a proposed €150 million (about US$168 million) loan for Uganda’s Standard Gauge Railway on Monday, 19 October. The fund says it is targeting board approval by 30 November.

For US investors and suppliers, the loan is a step toward financial close on East Africa’s biggest rail project. The line runs from Malaba on the Kenyan border to Kampala and is estimated at €2.7 billion (about US$3.0 billion).

Appraisal Mission Under Way

The OPEC Fund team opened its week-long visit with an entry meeting at the railway project’s headquarters in Kampala, according to Daily Monitor and Nile Post. It is due to meet officials from the finance and works ministries and inspect the Malaba to Kampala corridor.

The appraisal covers engineering designs, implementation arrangements, disbursement schedules and environmental and social safeguards. The loan has not been approved.

File photo: Kampala, Uganda. Foto: Todd Huffman, CC BY 2.0

How the Project Is Financed

The proposed loan equals about Shs697 billion in local reports. Uganda’s financing plan has export-credit agencies covering about 60% of costs, development finance institutions about 25% and the government about 15%.

The Islamic Development Bank approved €650 million (about US$729 million) for the project in June 2026. It would fund the 553-metre Jinja Nile Bridge, the 2.12-kilometre Mbuya to Kampala tunnel, six stations and three workshops.

Timeline and Early Works

The main construction period is planned to last 48 months from commencement. Reports differ on the target: Nile Post says construction starts in January 2027, while Daily Monitor calls January 2027 the target for financial close.

Early works under a limited notice to proceed, valued at €75 million (about US$84 million), are reported to be nearing completion. Land compensation and the remaining financing are still outstanding.

Official Position

Kemi Afun-Ogidan, the fund’s senior country manager, said at the entry meeting that approval would make this its largest single financing commitment to Uganda since it began operating there in 1976. She said the fund is targeting board approval by 30 November.

The two reports we reviewed from 19 October carry no public opposition or formal objection. Earlier coverage points to financing completion, land compensation and the timing of the main contract as the main concerns.

What It Means for US Readers

Board approval would give the project a second large development-finance commitment after the Islamic Development Bank. It could also help unlock the much larger export-credit tranche.

The 48-month build offers openings for engineering, rail and logistics suppliers. US firms tracking East African infrastructure should watch whether financial close slips past January 2027.

What Is Not Known

The loan is a proposal until the OPEC Fund board votes, and no board date has been published. Its interest rate, term, fees and conditions have not been disclosed.

It is unclear whether the export-credit tranche is fully committed. The Finance Ministry’s earlier target of November 2026 for concluding financing differs from the January 2027 date, and we could not establish which is current.

Sources

Daily Monitor · Nile Post · Pulse Uganda · Uganda SGR project office

This article was produced by The Rio Times’ automated newsroom system. How we use AI · Report an error · Editorial responsibility: Matthias Camenzind, Editor-in-Chief

Frequently Asked Questions

When could the OPEC Fund approve the Uganda railway loan?

The fund targets a board decision by 30 November 2026. The appraisal mission began on 19 October, about six weeks earlier.

How big is the proposed loan?

It is €150 million, about US$168 million at the 19 October EUR/USD rate of 1.1214. Local reports put it at about Shs697 billion.

How much will the Uganda railway cost?

The Malaba to Kampala line is estimated at €2.7 billion, about US$3.0 billion. Export-credit agencies, development banks and the government are to cover 60%, 25% and 15%.

When will main construction start?

Reports differ: January 2027 is called the construction start by one outlet and the financial close target by another. Construction is planned to take 48 months.