By David Mwanje
Minister of Works and Transport Gen. Edward Katumba Wamala has called for a bold reset in the relationship between Uganda’s commercial banks and construction contractors, urging financial institutions to rebuild trust and create equitable financing frameworks to fuel the sector’s growth.
Speaking at the Construction Procurement and Finance Dialogue in Kampala, hosted by the Uganda National Association of Building and Civil Engineering Contractors (UNABSEC), Wamala proposed a dedicated construction financing window modeled on agricultural models to empower contractors strained by delayed government payments.
The dialogue convened contractors, bankers, and policymakers to address the sector’s chronic financing challenges. Wamala zeroed in on the fallout from delayed payments, which have saddled firms with harsh loan terms. “These delays have broken trust, leaving contractors to bear the brunt of high interest rates,” he said, emphasizing the need for banks to partner with the government in supporting a sector critical to Uganda’s infrastructure ambitions.
His proposal for a specialized financing window aims to stabilize cashflows, enabling firms to deliver projects like the Kampala-Jinja Expressway and the Standard Gauge Railway on schedule.
Diamond Trust Bank (DTB) CEO Geofrey Ssebaana echoed Wamala’s sentiments, urging contractors to adopt sharper financial discipline and sustainable practices to unlock lender confidence.
“We’re ready with innovative, calculable solutions, but accountability is the key to better terms,” Ssebaana said, highlighting issues like fund diversion that erode trust. He positioned contractors as nation-builders, not mere clients, aligning with Wamala’s vision of collaborative growth.
The dialogue resonates with Uganda’s 2025/26 budget, presented on June 12, 2025, which allocates UGX 9.1 trillion to infrastructure development, including UGX 3.5 trillion for road construction and rehabilitation. The budget emphasized public-private partnerships (PPPs) to bridge funding gaps, aligning with Wamala’s push for tailored financing.
It also earmarked funds for the Ministry of Works and Transport to clear payment arrears, addressing the delays Wamala flagged as a trust-killer.
The Ministry of Housing and Urban Development’s agenda, tackling a 2.4 million-unit housing deficit, further underscores the sector’s role, with UGX 200 billion allocated for affordable housing projects using eco-friendly designs.
UNABSEC President Kiara Binta Nkuranga hailed the dialogue as a “game-changer,” vowing to translate talk into action. “This partnership between government, banks, and contractors is our springboard to transform the industry,” she said, noting UNABSEC’s training programs on financial literacy and green construction to prepare firms for economic and regulatory shifts.
Wamala’s vision draws from the budget’s focus on sustainability, with the Ministry of Housing and Urban Development promoting low-carbon materials to meet global climate goals.
The construction sector, contributing 12% to GDP per the Ministry’s 2024/25 report, stands to benefit from tax incentives for green projects, amplifying Wamala’s call for innovation. “We’re not just building roads—we’re building a resilient future,” he declared, urging banks to see contractors as partners in this mission.
The budget also highlights digital tools to streamline project management, supporting Wamala’s push for efficiency. With UGX 100 billion allocated for e-procurement systems, contractors can access transparent bidding processes, reducing delays that exacerbate financing woes.
Wamala emphasized that such reforms, paired with a financing window, could unlock the sector’s potential to drive Uganda’s urbanization, particularly in Kampala, where housing demand soars.
As the dialogue wrapped, DTB and UNABSEC committed to crafting actionable frameworks, from streamlined loans to mentorship for small firms. Wamala’s closing words set the tone: “Trust is the foundation of progress. Let’s build it together.” With Uganda’s infrastructure pipeline expanding and budget support in place, the construction sector faces a pivotal moment to align with Wamala’s vision, leveraging discipline, innovation, and collaboration to shape a thriving economic future.
Discover more from Trendz Africa
Subscribe to get the latest posts sent to your email.
