By DANIEL K. KALINAKI
June 08, 2014(The EastAfrican) — The government of Uganda has raised its domestic borrowing ceiling as it seeks to raise money to plug a budget deficit and, among other expenditures, support its military intervention in South Sudan.
Central bank sources said that the domestic borrowing ceiling has been raised by Ush675 billion ($259 million), from Ush1.04 trillion ($400 million), to allow the government to plug holes in its revenues and provide for the growing costs of the army’s activities in the region.
The Ministry of Defence has asked parliament to approve a supplementary budget of Ush170 billion ($65 million) “for regional security,” part of which, MPs say, is meant to support the deployment of the Uganda People’s Defence Forces in the neighbouring country.
“My suspicion, and that of many Members of Parliament, is that this money has gone to support the war in South Sudan,” Kyadondo East MP Ssemujju Ibrahim Nganda of the opposition FDC party told The EastAfrican.
The Ministry of Defence’s request is part of Ush482.5 billion ($185 million) that the government is seeking as supplementary funding this financial year and is the first glimpse of the financial cost of Uganda’s involvement in the conflict in South Sudan.
The UPDF was deployed in South Sudan to secure government installations and ensure safe passage of foreign nationals and civilians after fighting broke out in Juba on December 15.
The army has since been sucked into the conflict on the side of President Salva Kiir, who is locked in a political and military contest against former vice-president Riek Machar, and has sparked a civil war and a humanitarian crisis in the country.
Ugandan military officials have been tight-lipped about the cost of the war. When he tabled the request for additional financing for the Defence Ministry, Aston Kajara, Junior Finance Minister, told MPs that Ush85 billion ($32 million) of the Ush170 billion ($65 million) is urgently needed for classified expenditures.
When pressed by shadow finance minister Hassan Kaps Fungaroo to state whether the money was intended for the UPDF operations in South Sudan, Mr Kajara said the money was needed to address “urgent security challenges that require urgent attention.”
Defence Minister Crispus Kiyonga was not available for comment.
MPs on the Defence Committee told The EastAfrican that when the minister appeared before them earlier this year, he revealed that the UPDF had allocated Ush25 billion ($9.6 million) to cater for the costs of its deployment in South Sudan and had not expected the deployment to last more than three months.
With the conflict entering its sixth month, however, it is beginning to put a strain on the defence budget and raise questions about how the war is being funded. With the supplementary request, Uganda’s defence budget will rise to Ush828.2 billion ($318.5 million).
State Minister for Defence Jeje Odong told MPs last month that the Government of South Sudan had agreed to pay for the fuel that the UPDF is using in the war, but the claim was quickly refuted by Bol Makueng Yuol, Deputy Minister for Education and Secretary for Information in the ruling SPLM party.