Ugandan authorities deny Chinese takeover of airport

Ugandan authorities deny Chinese takeover of airport

Lawal Adenike

The Civil Aviation Authority of Uganda (CAA) has dismissed media reports that the country risks losing its only international airport owing to a Chinese loan deal.

Recall BlackBox Nigeria reported that the Export-Import bank of China has rejected Uganda’s request to re-negotiate ‘toxic clauses’ in the $200m loan picked six years ago to expand Entebbe International Airport.

Mixed reactions from members of the public have since trailed the reports, with different comments from social media users who blasted government for signing the agreement that might see the country’s only international airport taken over by the Chinese government.

However, in a statement on Saturday, the Uganda Civil Aviation Authority (UCAA) said the purported takeover of the airport was untrue.

The UCAA spokesperson Vianney Luggya said, “I wish to make it categorically clear that the allegation that Entebbe Airport has been given away for cash is false. The government of Uganda cant give away such a national asset. We have said it before and repeat that it has not happened. There isn’t an ounce of truth in it.”

It was also indicated in the report that in the loan agreement between the two countries, UCCA is required to set up an escrow account to hold all of the authority’s revenues with the mandated government body regulating civil aviation in Uganda disallowed to use money on the said account without approval from the Chinese government.

The UCAA, however, admitted that whereas they opened up a sales collection account in Stanbic bank where all its revenues are deposited in line with the Escrow Account Agreement terms, no one else controls the account as reported.

“The Authority enjoys the freedom and liberty of spending what is collected (as per the budget). The lender’s monitoring of the account is only similar to what happens when one gets a salary loan or any other loan and the bank requests that the salary is channeled through their bank. It does not mean that lending bank takes over your salary.

“The loan terms provide a grace period of 7 years, and we are still within that grace period during which only interest is paid, and government has not defaulted on those obligations,” Luggya said.


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