Over the past decade, Uganda has made infrastructure a cornerstone of its development agenda, with over 30% of the national development budget consistently allocated to roads, energy, and logistics (National Planning Authority, 2020).
This focus began with the launch of the first National Development Plan (NDP I) in 2009/10, which marked a strategic shift toward infrastructure-led growth to boost productivity, trade, and industrialisation. In 2025, this vision is more ambitious than ever, aligning with Uganda’s ten-fold growth aspiration.
However, while infrastructure spending has remained high, delays in the completion of key projects—ranging from energy and transport to logistics—threaten to erode their intended economic impact. As Uganda enters FY2025/26, the challenge is no longer about prioritisation but about execution. Without timely delivery, the infrastructure meant to unlock growth risks becoming a fiscal burden, limiting benefits from the completed projects.
One of the significant project is the Karuma Hydropower Dam, a flagship investment meant to transform Uganda’s energy landscape by adding 600 megawatts to the national grid. While construction was to be completed in 2013, the dam delayed for years and missed multiple completion targets. Last year, after ten years of wait, it was fully commissioned.
These delays were caused by procurement disputes, contractor quality issues, inadequate supervision, and unresolved land acquisition challenges. The cost of the dam rose to over USD 1.7 billion (from the initial $1.4bn), mostly financed by loans from the Export-Import Bank of China, pushing up Uganda’s debt burden. For taxpayers, this means years of paying interest on a project that was not yet delivering returns—contributing to mounting public debt and reduced fiscal space for critical sectors like health, education, and agricultural extension.
The delayed operationalisation of Karuma also had broader implications for Uganda’s ten-fold growth ambition. The dam was expected to power industrial parks, enhance grid reliability, and reduce energy costs—key enablers of structural transformation and private sector competitiveness. Instead, manufacturing investments in regions like Nwoya, Lira, and parts of Eastern Uganda were either deferred or scaled down due to electricity access constraints. Missed opportunities in job creation, value addition, and exports meant Uganda could not fully capitalise on the planned industrialisation momentum.
The Standard Gauge Railway is another project that has experienced significant delays since the idea was mooted many years ago.
The Standard Gauge Railway (SGR) is another critical infrastructure project with far-reaching implications for Uganda’s economic transformation. Envisioned to connect Kampala to Malaba on the Kenyan border over a 273-kilometre corridor, the SGR was designed to modernise Uganda’s freight transport system, linking it efficiently to Kenya’s port of Mombasa and reducing transport costs for heavy goods such as cement, steel, and agricultural exports. However, despite a projected cost of USD 2.3 billion and extensive preparatory work since 2014, the project remains stalled, largely due to financing delays, limited coordination with Kenya, and unresolved land acquisition challenges. While Uganda continues to operate its colonial-era metre-gauge railway (MGR)—which has undergone partial rehabilitation—this older system lacks the capacity, speed, and reliability needed to support the country’s industrialisation goals. The absence of a functioning Standard Gauge Railway, which was meant to replace the ageing MGR and integrate Uganda into a modern regional transport network, continues to constrain trade competitiveness and investment flows.
For the Ugandan taxpayer, the prolonged delay in SGR implementation has resulted in sunk costs on feasibility studies, stalled contractor negotiations, and growing scepticism from potential development financiers. In the meantime, the country bears high logistics costs, road congestion, and limited freight-handling capacity—undermining the intended efficiency gains.
This delay frustrates efforts to unlock the full potential of industrial parks in Namanve, Tororo, and Mbale, which were strategically located along the planned SGR route. Without a modern railway system, Uganda is unable to fully leverage its geographic position as a regional transit hub or reduce the cost of doing business in key sectors like manufacturing and agro-processing. The SGR’s stagnation illustrates how delays in infrastructure implementation can erode economic momentum, reduce return on investment, and ultimately hinder the structural transformation needed to achieve long-term inclusive growth.
Another landmark project is the Bukasa Inland Port on Lake Victoria, designed to link Uganda to Tanzania’s port of Dar es Salaam via Mwanza. By offering an alternative trade route and reducing overreliance on Kenyan road corridors, the port could lower freight costs by up to 30%. But still, its success hinges on resolving resettlement issues and improving coordination with Tanzanian counterparts and lake transport operators.
Furthermore, the Kampala–Mpigi Expressway, under construction, is expected to ease traffic along a key corridor and boost commuter efficiency. Slated for completion in 2027, it will also catalyse growth in towns along its path. Yet, progress has been hampered by delays in land compensation, while a lack of investment in feeder roads could limit its overall impact. For infrastructure investments to yield their intended economic benefits, the government must address the persistent inefficiencies that delay project completion. This includes undertaking thorough feasibility studies and cost-benefit analyses before launching projects, ensuring that landowners are fully compensated before public debt is contracted, and amending land laws to facilitate timely and equitable compulsory land acquisition. Additionally, strengthening anti-corruption mechanisms in procurement and project management is vital to prevent leakage and ensure materials and funds are used efficiently. Capacity at the local government level should also be enhanced to improve project supervision and road maintenance.
Photos credit: UEGCL and Ministry of Works
