By Faridat Salifu
Uganda’s Parliament has approved a loan of Shs353 billion (US$99.56 million) from the International Fund for Agricultural Development (IFAD) to finance a new livestock value chain project.
The loan is part of the Resilient Livestock Value Chain Project, which seeks to improve the livelihoods of smallholder farmers through beef and dairy production.
The project is expected to benefit more than 400,000 households and directly or indirectly impact up to 20 million Ugandans across 55 districts within the cattle corridor.
Government officials said the total project cost is about US$204.8 million, to be funded by multiple partners including IFAD, the Global Environment Facility, the Green Climate Fund, the Africa Rural Climate Adaptation Finance Mechanism, the Ugandan government, and project beneficiaries.
Of this, IFAD will provide US$99.56 million, the Global Environment Facility and Green Climate Fund will jointly contribute US$50 million, and the Africa Rural Climate Adaptation Finance Mechanism will give US$15 million.
The Ugandan government will commit about US$31.97 million in cash and in-kind contributions, while project beneficiaries will add about US$8.3 million.
The loan from IFAD comes with favorable conditions, including a 50-year repayment period, a 10-year grace period, zero interest, and a 0.1 percent service charge.
Parliament’s approval came after weeks of scrutiny, with some lawmakers welcoming the loan as a major investment in rural communities that depend heavily on livestock for income and food.
However, concerns were raised that significant portions of the loan were earmarked for vehicles, consultancies, training, and workshops, rather than direct support to farmers.
Some legislators also questioned the growing public debt, warning that even concessional loans like this could worsen Uganda’s fiscal burden if not properly managed.
Supporters of the deal countered that the project could transform livestock farming by improving animal breeds, veterinary services, market access, and reducing post-harvest losses.
According to the Ministry of Agriculture, the project will also promote climate-smart practices to protect pastoralists against drought and improve the sustainability of the cattle corridor.
Parliament was informed that the government must sign the loan agreement by September 12 or risk losing access to the funds.
Lawmakers are now pressing for close monitoring to ensure that money reaches farmers and is not diverted to administrative costs.
The government has pledged to publish regular progress reports and work with local leaders to ensure transparency in implementation.
If successfully executed, the project is expected to boost household incomes, strengthen food security, and reduce poverty in livestock-dependent regions of Uganda.
