A senior official told Reuters that Uganda expects to pick the winning bidder to build and operate a $1.5 billion road project under a public private partnership (PPP) model by the end of 2019.
The planned 95-km (60-mile) highway will connect the capital Kampala with Jinja, an industrial town in the east of Uganda. The road is apart of a broader network that helps link the Kenyan coast to landlocked Uganda, Rwanda, Burundi and South Sudan, as well as the eastern Democratic Republic of Congo.
Head of design at state-run Uganda National Roads Authority (UNRA), Patrick Muleme told Reuters the motorway was the first road in Uganda being implemented using a PPP model. Earning profits by charging tolls before handing it back to the state, the contractor will design, build and operate the road for 30 years.
Muleme noted that work would be expected to start in 2020. He said “we expect that by end of the year we will have selected the final preferred bidder”.
UNRA short-listed four joint bids last month including one led by German-based Strabag AG and another led by China’s Communications Construction Company (CCCC).
According to Muleme, construction would cost about $1 billion, with the contractor raising $600 million and the government contributing $400 million. A further $500 million would be needed to cover land acquisition, debt financing and operating costs.
He revealed that the World Bank is the project’s adviser and noted the government is planning to build two roads using the PPP model.
Muleme said projects using the PPP model were planned in Kenya and Tanzania, while he said others had successfully worked in other parts of Africa including South Africa and Senegal.