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Behind Uganda’s scrapping deal with China

Published : Saturday, 11 February, 2023 at 12:00 AM  Count : 673

Behind Uganda’s scrapping deal with China

Behind Uganda’s scrapping deal with China

For the last few decades, China has jerked the whole world with its nimble economic growth, surpassing Japan and other European countries in GDP and PPP, through which the country made a breakthrough vestige in economic hegemony over the Asian, African and some other European regions and countries.

However, despite Chinas recent crawls in economic growth posed by Covid-19 and the Ukraine crisis, the country is still on top of the list with regard to making influences on the world economic order. In this respect, The Belt and Road Initiative (BRI) project taken by Xi Jinping in 2013 is reckoned as one of the prime and grand strategies of China through which the country has been sketching its future position in world politics.

The question may arise that how BRI again got pertinent among the bunch of issues of world politics. This is because of the newly transpired case of Ugandas scrapping of a $2.3 billion agreement with China Harbour and Engineering Company Ltd (CHEC) regarding the construction of a railway line from Kampala, the countrys capital, to the Kenyan border. The project failed to launch after it had been contracted eight years ago.

The East African country scrapped all of the contractual work it had agreed to do with the Chinese company to construct the 273-kilometre standard gauge railway (SGR). It has been deeply concerning for Uganda that the CHEC has failed to keep up their commitment and provide financial assistance to the country for the construction. According to Perez Wamburu, the project coordinator of SGR, 'Uganda has not received any communication or funding for the project from CHEC for two years. This is unacceptable and disappointing.'

Why the Deal Was Cancelled
Uganda is a landlocked country in the East African region which is holding nearly a $45 billion GDP in recent years. From an infrastructural development perspective, compared to other African countries, Uganda is considerably lagging in many aspects due to diverse socioeconomic challenges and political predicaments. One of the major hurdles behind its economic growth and development, however, is having no immediate connection with the open sea and thus, having no opportunity for seaports. Therefore, the contract between Uganda and the CHEC was very crucial for the overall economic betterment of the country overcoming the curse of landlocked feature. In this regard, the railway would connect Uganda with the Indian Ocean which might augment the extraction of the SGR�s potential to be a valuable resource for the African nation. However, the project is intended to link to Kenya�s standard gauge railway, which extends all the way to Mombasa, a port city. Kenya has constructed 730 kilometres of railroad with funding from China but the railway that connects to the Ugandan border, however, has not yet been constructed.

Moreover, it was also expected to enhance the country's connections in the African region and incorporate it in the holistic plan of the BRI in the region but all the plans have been stuck due to the indiscreet attitudes of China. Although Chinese Foreign Ministry spokesperson Wang Wenbinsaidina briefing that, "practical cooperation between China and Uganda has taken the lead in China-Africa cooperation," China did not respond or gave any overt statement about the deal.

However, as the deal was a considerable part of the Belt and Road Initiative, therefore, the transparency, credibility and commitment trustworthiness of the BRI loans is again being questioned on the world stage.

Alternative Plan of Uganda
Given all the dynamics posed by China, Uganda is now eyeing the Turkish company YapiMerkezi to take over the responsibility of the project that China has withdrawn from consideration. The construction of a railway in neighbouring Tanzania is one of the infrastructural projects in Africa on which YapiMerkezi is now working. According to an anonymous source at the Ugandan Ministry of Transport told Reuters, 'the discussions exhibited that YapiMerkezi is interested in the project. The Ugandan authority in conversations with them. Although there isn't a contract in place with them yet, there is anMoU and things are progressing quickly.'

China�s Procrastination and BRI Question
Being steadfast and having transparency are unquestionably obligatory matters in attaining the trustworthiness of counterparts and building a solid relationship of cooperation in world politics in which China�s BRI stumbled again. Despite having robust prospects for the East African country in the BRI project, China has given rise to grave suspicion regarding the funding credibility of the BRI. No doubt that the African region to a considerable extent matters to China which the country itself does not want to miss out but the reasons behind the withdrawal of such a major construction project are still unrecognisable since no utterance has been observed from China in this regard. Even the trip of President YoweriMuseveni�s visit to China in 2018 was unable to persuade the China Exim Bank, which bank has been funding the country's projects, to grant the promised finance.

By contrast, another question may arise while China swamped Sri Lanka and some other countries with huge economic assistance, why the country demonstrated absurdity in respect of Uganda? Apart from the anomalies in world politico-economic situations in the last two or three years, why has China made Uganda wait for eight years while it is continuing its projects in other African countries such as Kenya? Is it for losing political interest in the country and keeping a strong relationship with Kenya completing the ongoing SGR projects in the country? In this regard, a notable factor for the project�s lack of commitment has been observed that the Chinese construction company has been waiting plainly for Kenya to finish building its SGR from Naivasha to Malaba, the town connecting Kenya and Uganda using Chinese financing, while it is overlooking the commitment of considerable sole SGR project of Uganda. However, many more critical viewpoints can be put forward in questioning BRI regarding this incident since Uganda has not been communicated and informed of any clear-cut decision about the termination by the CHEC for a long time.

A New Trajectory in China-Uganda Relationship?
China and Uganda maintain a sound diplomatic relationship for years. Both countries also uphold significant economic relations which by the advancement of the BRI have become more cogent for overall trade and connectivity. In the last twelve years since 2008, the trade volumes between the two counties have strikingly increased and reached a billion-dollar partnership, although the African country exports more than imports.

-    The writer is a contributor

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