The World Bank lifts freeze on Uganda loans after a two-year suspension due to Uganda’s enactment of the Anti-Homosexuality Act (AHA) in 2023. This law, one of the harshest against LGBTQ people, led the Bank to halt funding. The World Bank has now confirmed that it is satisfied with Uganda’s “mitigation measures,” which will protect vulnerable groups. The Bank initially suspended funding because it feared that its programs might unintentionally support discrimination under the new law. Uganda heavily relies on the World Bank for funding essential services like education, transport, energy, and public services.
The World Bank lifts freeze on Uganda loans and resumed funding for education, social protection, and refugee support projects. Uganda and the World Bank collaborated to develop mitigation measures that ensure future projects uphold inclusion and human rights. A spokesperson from the World Bank explained that its mission to end poverty requires that everyone participates in and benefits from its programs.
Uganda has faced economic challenges since other foreign donors suspended major programs, including PEPFAR and USAID-linked projects. The Finance Ministry reports a sharp drop in donor funding for fiscal year 2024/25, making it difficult for Uganda to deliver essential services. The World Bank’s resumption of funding offers some relief, but the economic impact of the AHA continues to affect the country.
Despite mounting international pressure, President Museveni defended the Anti-Homosexuality Act. His government dismissed foreign criticisms, which it viewed as an attack on Uganda’s sovereignty and culture. Museveni has stated that the law is necessary to protect society from what he calls the “disorientation” of the LGBTQ community. He has clarified that those living quietly with their sexual orientation won’t face punishment, but anyone recruiting others into homosexuality will be penalized.
Uganda’s response to international pressure and the World Bank freeze on loans reflects a larger trend. Anita Among, Speaker of Parliament, also defended the law. The UK imposed sanctions on her for corruption, accusing her of benefiting from misdirected funds. Among rejected the sanctions and called them politically motivated because of her support for the AHA. She has repeatedly said that foreign criticism aims to undermine Uganda’s sovereignty and cultural values.
Economists estimate that Uganda lost between $470 million and $1.7 billion in investment, tourism, and aid in the first year after the law passed. The Open for Business report highlighted these losses. At the same time, scrutiny of development partnerships has increased. However, the World Bank’s shift shows a pragmatic approach. The Bank recognizes the need to engage with countries like Uganda, even if their policies differ from global norms.
The lifting of the World Bank loan freeze marks a turning point for Uganda. It also reflects growing global tensions between development goals and local policies. Many African countries, including Nigeria, Kenya, and Ghana, have hardened their stance on LGBTQ rights. As these laws become more widespread, international donors will face more difficult decisions about whether to continue supporting such nations. Uganda’s future with global development agencies will remain complex. Uganda’s experience will continue to shape the ongoing debate about development, sovereignty, and human rights.
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