Country Report Uganda March 2010

Economic policy: The programme for the north enters its second phase

The second phase of the Northern Uganda Social Action Fund (NUSAF) was launched at the beginning of February amid signs that some of the funds provided were going missing. Around US$100m was provided in the first stage of this World Bank-financed programme, mainly for improving services and support for vulnerable communities in the former war zone terrorised by the rebel Lord's Resistance Army (comprising 40 districts across the north in Acholi, Bukedi, Bunyoro, Elgon, Karamoja, Lango, Teso and West Nile).

However, it is not clear how successful the scheme has been so far. The World Bank says that at least USh3.3bn (US$1.62m) of spending had not been account-ed for by September 2009, including USh2.5bn directed towards community initiatives. The Bank plans to set up an office in the region to monitor the second phase of the programme, which will provide a further US$100m towards three components; livelihood investment support, community infrastructure rehabilitation and institutional development. Disbursement of funds will be suspended to any district where corruption is discovered unless sufficient action is taken to deal with the culprits.

Launching the second phase, the president, Yoweri Museveni, said that his government would also be spending its own resources on a range of developments across the northern region, including the upgrade of roads and electricity supply. USh1.1trn (US$508m) of funding was earmarked for the region over three years under a parallel programme, the Northern Uganda Peace, Recovery and Development Plan (July 2009, Economic policy) beginning in 2009, but the government has consistently failed to deliver on past pledges to direct more resources to the region and this has become a bone of contention with donors.

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