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Uganda: The country has lost its only international airport, Entebbe International Airport to China, for failing to repay a loan.
The government has been unable to alter the loan agreement with China that included repayment requirements in exchange for the attachment of the country’s only airport.
Uganda received a $207 million loan from China’s Export-Import (EXIM) Bank in 2015, with a 2% interest rate upon disbursement. According to News X, the loan was for the expansion of Entebbe airport and had a 20-year maturity duration with a seven-year grace period.
According to foreign media reports, the Ugandan government renounced the international immunity clause in order to secure the loan, allowing the Chinese lender to reclaim Entebbe International Airport without the need for international arbitration.
Some terms in the Financing Agreement with China, according to the Uganda Civil Aviation Authority (UCAA), exposed Entebbe International Airport and other Ugandan assets to being attached and taken over by Chinese lenders the following arbitration in Beijing.
Uganda’s Finance Minister, Matia Kasaija, apologized to Parliament last week for “mismanaging” the multi-million dollar loan.
According to the latest media reports, a Ugandan delegation visited China early this year in an attempt to renegotiate the loan agreement’s provisions. The visit, however, was fruitless because Chinese authorities refused to accept any changes to the deal’s initial provisions