AFDB supports Uganda’s MSMEs in the petroleum sector


The government of Uganda and The African Development Bank signed an agreement worth $500,000 to finance Micro, Small and Medium Enterprises (MSMEs) so as to boost business linkages on the East African Crude Oil Pipeline Technical Assistance project.

The bank will contribute the funds through the Fund for African Private Sector Assistance (FAPA) while the Government of Uganda through the Petroleum Authority will provide counterpart funding. A similar project is also being finalised in Tanzania.

The key objective of the grant is to help develop the capacity of local Uganda MSMEs along the East African crude oil pipeline by helping them to build linkages with larger, national, regional and international companies as well as accessing new market opportunities.

The project aims to create an estimated 500 jobs along the pipeline and support inclusive private sector growth.

Source: EIA

According to the African development bank, “the grant was provided in response to a request from Uganda and Tanzania for assistance in preparing local business communities to be able to retain a portion of the $3.5 billion investment in the construction of a crude oil pipeline from Hoima in western Uganda to Tanga, on the Coast of Tanzania, agreed in 2016”

The government of Uganda and Tanzania recently signed an agreement in September this year for Total E&P to undertake the project as the lead private sector developer.

The grant was signed by Matia Kasaija, Ugandan Minister of Finance, Planning and Economic Development and AFDB Acting Senior Vice President and Chief Finance Officer Swazi Tshabalala on behalf of the African Development Bank.

The target of the project is to train at least 100 local micro-businesses in Uganda and Tanzania to do business on the pipeline project as well as link at least 700 business enterprises.

Fund for African Private Sector Assistance (FAPA) is a multi-donor thematic trust fund which provides grant funding for technical assistance and capacity building to support the implementation of the AFDB Private Sector Development Strategy.

FAPA organises regional and national projects aimed at improving the business environment, building private sector Infrastructure, strengthening financial systems, promotion of trade and development of Micro Small and Medium Enterprise.

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