Uganda denies media reviews about China taking up its airport

On Saturday (November 27), the spokesperson of the Uganda Civil Aviation Authority (UCAA) dismissed media reviews, which claimed that China was going to take over the nation’s solely worldwide airport resulting from non-payment of a mortgage taken to increase the airport. Uganda had signed a mortgage settlement on March 31, 2015, with the Export-Import (Exim) Bank of China for the enlargement of the Entebbe International Airport. However, the authorities have admitted that there are problematic clauses within the mortgage settlement, as Uganda is looking for to amend some clauses within the settlement.
After a number of media reviews the world over, together with India, claimed that China has taken over the airport, the Uganda Civil Aviation Authority issued a press release to disclaim the declare. In a Twitter thread, UCAA spokesperson Vianney M Luggya wrote, “I wish to make it categorically clear that the allegation that Entebbe Airport has been given away for cash is false. The Government of Uganda can’t give away such a national asset. We have said it before and repeat that it has not happened. There isn’t an ounce of truth in it.”
He conceded that UCAA funds are deposited in an escrow account (an asset held by a 3rd celebration on behalf of two different events through the transaction course of) however clarified that none apart from the Ugandan authorities has management over it.
It is true that @UgandaCAA opened up a Sales Collection Account in @stanbicug the place all of the Authority’s revenues are deposited according to the Escrow Account Agreement phrases, but it surely doesn’t imply that anybody is to regulate our funds.— Vianney M. Luggya (@UCAA_Spokesman) November 27, 2021
Vianney M Luggya emphasised, “The Authority enjoys the freedom & liberty of spending what is collected (as per the budget). The lender’s monitoring of the account is only similar to what happens when one gets a salary loan or any other loan, & the bank requests that the salary is channeled through their bank. It does not mean that lending bank takes over your salary.”
He added that the mortgage, sanctioned to Uganda, by the Export-Import (Exim) Bank of China offered a grace interval of seven years. During the stated interval, the Ugandan authorities needed to pay solely the curiosity and never the principal quantity, According to the UCAA spokesperson, the grace interval shouldn’t be over but and the federal government has not defaulted on curiosity compensation so far. Vianney M Luggya assured that the Entebbe International Airport was in secure fingers.
It doesn’t imply that lending financial institution takes over your wage. The mortgage phrases present a grace interval of seven years, and we’re nonetheless inside that grace interval throughout which solely curiosity is paid, and authorities has not defaulted on these obligations.— Vianney M. Luggya (@UCAA_Spokesman) November 27, 2021
China dismisses reviews of debt entice and airport confiscation
Meanwhile, the Chinese authorities had additionally rejected reviews, that prompt a forcible takeover of Ugandan airport by making a ‘debt trap.’ While talking in regards to the matter, China’s Director-General for African Affairs Wu Peng claimed, “Which of the Chinese projects in Africa have been confiscated in Africa? NONE! The hype surrounding the Chinese ‘debt trap’ in Africa have NO factual basis and is being pushed on malicious grounds.” Peng, who serves as China’s Director-General for African Affairs, dismissed such media reviews as ‘illogical propaganda.’
Media reviews that claimed Uganda’s give up of worldwide airport to China
On Thursday (November 25), the Daily Monitor revealed an unique story suggesting that the Ugandan authorities had surrendered the Entebbe International Airport in alternate for Chinese cash. It had claimed, “Our investigations over several months show that Uganda dispatched a delegation to Beijing after Exim Bank suspended funding, citing violation of the loan agreement after UCAA failed to implement some of the clauses, which were not favourable to Uganda.”
Screengrab of the information report by Daily Monitor
The Daily Monitor emphasised that makes an attempt at revisioning the Financing Agreement phrases with China had failed and the way it posed a menace to Uganda’s sovereign belongings, provided that the federal government withdrew sovereign immunity on airport belongings. “Among the controversial provisions is a surrendering under the airport loan agreement of the approval of UCAA budget, master and strategic plans, which ordinarily are the mandates of the aviation regulator’s board, to Exim Bank in Beijing,” it had claimed.
The Monitor report had stated that the mortgage deal exposes the airport and different authorities belongings to potential attachments and take-over by China upon arbitration awards in Beijing. It had talked about doable take over of the airport by China if the mortgage shouldn’t be paid again in time, however had used a deceptive headline saying “Uganda surrenders airport for China cash”. This led to different media homes claiming that Uganda has already taken over the airport.
Such distorted reviews have been revealed by many different media homes from a number of nations. Same unsuitable reviews have been additionally revealed by IANS and Indian media shops corresponding to WION, India Today and The Economic Times and so on.
Uganda seeks modification in mortgage clause
Even although each Uganda and China denied reviews of China grabbing the airport utilizing a debt entice, there’s some reality about regarding clauses within the mortgage settlement. The unique report by Daily Monitor unhappy that Uganda is looking for to amend the mortgage settlement it signed with China in 2015 to make sure that the federal government doesn’t lose management of the nation’s solely worldwide airport.
One of the clauses that Uganda needs to amend is the necessity for the Uganda Civil Aviation Authority to hunt approval from the Chinese lender for its funds and strategic plans. The settlement additionally provides Exim Bank the only authority to approve withdraws of funds from the UCAA accounts. Another problematic clause is that any dispute between the events must be resolved by the China International Economic and Trade Arbitration Commission.
As many as 13 clauses have been deemed unfriendly to Uganda by folks with data in regards to the matter. Apart from having the ability to approve annual and month-to-month working budgets, which it will possibly reject, the Exim Bank of China additionally has the proper to examine the federal government and UCCA books of accounts.