Parliament has approved a government proposal to borrow up to €168.9 million (about Shs720 billion) to expand solar-powered irrigation in coffee-growing areas across Uganda.
The House cleared the request on June 10, 2026 during a sitting chaired by Speaker Jacob Marksons Oboth. The funding will support the second phase of the Solar Powered Irrigation Systems Project, which aims to raise coffee production and help farmers cope with changing weather patterns.
The project will install 427 solar-powered irrigation systems and is expected to cover about 4,768 acres. Government estimates that more than 2,500 households will benefit directly.
Parliament suspended some of its procedural rules to consider the request before the formation of key committees that would normally scrutinise such borrowing proposals.
Speaker Oboth defended the decision, saying the absence of committees should not delay a project he described as critical to the country.
Presenting the motion, Finance Minister Henry Musasizi said prolonged dry spells continue to affect agricultural output and household incomes. He said irrigation would help farmers maintain production despite increasingly unpredictable weather.
Musasizi noted that government had initially planned 700 irrigation sites but reduced the number to 427 because of limited fiscal space.
Coffee remains Uganda’s top export crop. The country earned nearly $1 billion from coffee exports between March 2023 and February 2024. The sector supports about 1.8 million Ugandans.
Government data shows that only 23,595 hectares of Uganda’s land are under irrigation despite a potential of more than three million hectares.
Officials project that irrigation could increase average coffee yields from 1.3 kilogrammes of dried cherries per tree to 6.5 kilogrammes.
The financing package consists of a €148.5 million facility backed by United Kingdom Export Finance at a fixed interest rate of 3.65 per cent. The loan will be repaid over 13 years, including a three-year grace period. A further €20.5 million will come from Citi Bank under a seven-year arrangement with an estimated interest rate of 7.5 per cent.
Budadiri County East MP Julius Muntu backed the proposal, arguing that borrowing remains necessary because domestic revenues cannot fully finance government spending.
Agriculture Minister Frank Tumwebaze told Parliament that changing rainfall patterns have made irrigation essential for smallholder farmers who cannot afford large private irrigation investments.
Trade Minister Sanjay Tanna also supported the proposal, saying Uganda’s stable inflation environment makes this an appropriate time to secure development financing.
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