KAMPALA
Despite the financial crisis, European development partners have agreed to increase aid to Uganda from 439 to 578 million euros (roughly $791 million) over the coming seven years.
"We have just agreed to increase our collaboration with Uganda to 578 million euros over the next 7 years," Ambassador Kristian Schmidt, the European Union head of delegation in Uganda, told Anadolu Agency in an exclusive interview.
The money shall be released under the European Development Fund, the main instrument for providing technical and financial assistance to African countries.
"We will be working in the important sectors - again as agreed with the government of Uganda - on good governance, agriculture, infrastructure and roads," Schmidt said.
He asserted that despite a financial crisis, the euro being in difficulty and austerity measures across many countries "we decided to keep our development cooperation budget stable and in fact for Africa to increase it."
"I do hope we will see a commitment in the partnership on the side of Uganda that it is as strong as it has remained on the European side," said the European official.
Uganda received 439 million euros in European aid over the past seven years.
Previously the EU would channel its money through a consolidated fund of government.
But in order to curb the rampant corruption in Uganda, the European body now only gives money to EU-sponsored projects handled by project managers who then provide direct accountability.
In 2012, Britain, Denmark, Ireland, the World Bank, Austria and Norway suspended aid to the Office of the Prime Minister (OPM) following claims that staff had diverted $12.7m from an aid program into private accounts.
Of the Uganda shs50 billion meant for Peace, Recovery and Development Program (PRDP) for war-torn northern region and Karamoja sub-region, at least Shs33.8 billion came from donors’ contribution.
The donors withdrew funding and demanded that the government of Uganda refund the stolen money as a condition for further donor support.
In December 2012, Cabinet agreed to use taxpayers’ money to pay back the (OPM) stolen money.
It was agreed that the money would be withdrawn from the consolidated Fund and refunded to development partners.
"We asked for certain measures to be taken to solve the systemic weaknesses," Ambassador Schmidt told AA.
"We have decided collectively among Uganda’s development partners that steps have been taken to correct some of the issues that caused the OPM scandal," he added.
But he was quick to add, "am not convinced that all the weaknesses are yet to be addressed, I think a lot more has to be done before we can have full confidence that these systems are good for business."
In October 2013, the Ministry of Finance, Planning and Economic Development introduced the Treasury Single Account to aggregate all government cash balances into a set of linked bank accounts.
The EU Head of delegation cites the Public Financial Management Bill, which is still at committee level in parliament that elaborates how the Treasury Single Account should be implemented.
"That Bill is quite important and it should be adopted as soon as possible," he said.
"That law would strengthen the ability of government to keep track of funds," added the European official.
The bill provides for implementation of a treasury single account which is used to consolidate and manage government’s cash resources.
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