By Diana N. Kintu
The Government of Uganda has announced the approval of a financing package worth US$540 million (approximately UGX 2.1 trillion) from the World Bank to support the second phase of the Uganda Cities and Municipalities Infrastructure Development (UCMID) Programme.
According to a statement issued by the Ministry of Lands, Housing and Urban Development, US$80 million of the total package will be provided in the form of a grant, while the remainder will be extended as a loan. The funding is expected to strengthen urban infrastructure and improve service delivery across selected urban centres in the country.
The programme will be implemented over a six-year period, spanning the financial years 2026/2027 to 2030/2031, under the coordination of the Ministry of Lands, Housing and Urban Development. It will cover 10 regional cities, 26 municipalities, and 13 refugee-hosting districts, with an estimated 5.6 million people expected to benefit directly. Of these, approximately 1.6 million beneficiaries will be in refugee-hosting areas.
The overall objective of the programme is to enhance institutional performance in urban planning and management, while simultaneously improving access to climate-resilient infrastructure, basic services, and employment opportunities. Upon completion, UCMID is projected to generate around 20,000 permanent jobs. These will include an estimated 5,000 jobs within refugee and host communities, created through activities such as market operations, infrastructure maintenance, waste management, and logistics services.
“This programme represents the next phase of Uganda’s urban reform agenda, positioning cities and municipalities at the heart of job creation, productivity gains, and economic transformation,” said Hon. Judith Nabakooba, Minister of Lands, Housing and Urban Development.
The Ministry further noted that Uganda is experiencing rapid urbanisation, with 27 per cent of the population currently residing in urban areas. This figure is growing at an estimated annual rate of 5.2 per cent. Between 2020 and 2030, the country’s urban population is projected to increase by 69 per cent, adding approximately 8.1 million people to urban centres. Urban areas already contribute about 70 per cent of Uganda’s Gross Domestic Product (GDP), highlighting their critical role as drivers of economic growth and development.
UCMID will focus on five key thematic areas: urban roads and mobility, drainage and flood mitigation, nature-based solutions and green infrastructure, sustainable solid waste management, and local economic development alongside job creation. These interventions are expected to ease traffic congestion, reduce transportation and logistics costs, and enhance access to markets, particularly for women, young people, and low-income communities.
In addition to infrastructure development, the programme will support institutional reforms aimed at aligning urban growth with Uganda Vision 2040 and the Fourth National Development Plan (NDP IV). It is anticipated that these reforms will promote entrepreneurship, strengthen governance systems, and foster inclusive urban development across participating local governments.
“Through this programme, we expect to decongest Kampala by creating opportunities in the new cities. UCMID will generate immediate employment during construction phases, while also creating sustainable long-term jobs in urban services and operations,” added Hon. Nabakooba. The Ministry concluded by urging local government leaders and implementing partners to ensure that all required environmental and social safeguards are fully addressed. This, it noted, will enable a smooth and timely commencement of project activities in the upcoming financial year, while safeguarding communities and promoting sustainable urban development.