By Parliament’s decision to approve a US$121.96 million (UGX 425.7 billion) loan from the African Development Bank (AfDB) to finance the South Sudan–Uganda Power Interconnection Project has sparked heated debate, with MPs questioning why the government is prioritizing electricity exports while many Ugandans remain in the dark.
The loan, part of eight new borrowing proposals worth UGX 9.7 trillion approved by Parliament last week, is intended to fund a high-voltage transmission line linking Uganda’s grid to South Sudan’s, allowing Kampala to sell excess power to its northern neighbour.
Government insists the project will help reduce the costs associated with deemed energy payments made to electricity producers for power generated but not consumed domestically. Officials argue that exporting power to South Sudan, like the existing exports to Kenya and Rwanda, will generate revenue and stabilize the sector.
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However, several legislators criticized the move as misplaced, noting that large parts of Uganda, particularly in rural and peri-urban areas, still lack access to electricity. They argued that the funds should instead be channeled into expanding domestic access and improving reliability for local industries.
“It makes no sense to export electricity to South Sudan when some of our own districts have never been connected to the grid,” one MP said during the debate, calling the project a reflection of “misplaced priorities.”
The approval comes as Uganda’s national debt continues to swell, with government now planning to borrow UGX 32 trillion to finance the 2025/26 national budget. Critics warn that the mounting debt burden, coupled with poor project execution, could leave the country paying for loans that fail to deliver value.
Meanwhile, government maintains that the interconnection project will boost regional integration and trade within the East African Power Pool, positioning Uganda as a key energy exporter in the region.
The South Sudan–Uganda Power Interconnection Project is one of several infrastructure projects financed through new loans approved by Parliament, which also include the Jinja–Mbulamuti–Kamuli–Bukungu Road, the Busega–Mpigi Expressway, and multiple oncology centres in Mbale and Arua.
Despite assurances from the Ministry of Finance, lawmakers remain divided over the balance between regional ambitions and domestic development priorities.
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