Description:
Uganda has made substantial progress on
its infrastructure agenda in recent years. The early and
successful ICT reform detonated a huge expansion in mobile
coverage and penetration resulting in a highly competitive
market. Power sector restructuring has paved the way for a
rapid doubling of power generation capacity. Uganda is doing
well on the water and sanitation MDGs, and has made
effective use of performance contracting to improve utility
performance. However, a number of important challenges
remain. Despite reforms, the power sector continues to
hemorrhage resources due to under-pricing and high
distribution losses, while electrification rates are still
very low. Providing adequate resources for road maintenance
remains a challenge, and further investment is needed to
increase rural connectivity and improve road safety.
Addressing Uganda's infrastructure challenges will
require sustained expenditure of around $1.4 billion per
year over the next decade, strongly skewed towards capital
expenditure. Uganda already spends approximately $1 billion
per year on infrastructure, equivalent to about 11 percent
of GDP. A further $0.3 billion a year is lost to
inefficiencies, the bulk of which are associated with
underpricing and distribution losses in the power sector.
Uganda's annual infrastructure funding gap is about
$0.4 billion per year, most of which is associated with
irrigation as well as water and sanitation infrastructure.