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Chinese angry with Museveni

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Threat to cut funding leads to fight among energy bosses

Sparks are flying between President Yoweri Museveni and his Chinese lenders, Exim Bank, on one hand and between Ministry of Energy officials and of the Uganda Electricity Generation Company Ltd (UEGCL) on the other. Trouble is over the piling up of court cases and parliamentary commissions of inquiry into the handling of construction of the Karuma and Isimba hydropower dams. The Chinese are unhappy that they are being drawn into the legal squabbles and have warned that they could suspend financing of projects if it does not stop. This has led Ministry of Energy officials into frantic finger pointing with President Museveni caught in the middle.

The latest incident occurred at State House Entebbe on Oct.21 during a meeting chaired by President Museveni. Several MPs, officials from the Energy Ministry led by the PS Kabagambe Kaliisa, and from UEGCL attended.

Several people who attended the meeting say it was a generally heated meeting. But many of them singled out an exchange between Kabagambe Kaliisa, the all-powerful Permanent Secretary of the Energy Ministry and Stephen Isabalija, the board chairman of UEGCL; two of the most influential men in the sector today, for causing sparks to fly. Kabagambe Kaliisa and Isabalija have for some time been involved in a cold war over who controls the 600 MW and the 183 MW Isimba dam but the gloves came off this time, witnesses say.

Isabalija reportedly kicked off the bout.

“You are the ones who have caused all these problems,” Isabalija said pointing at the officials from the Energy Ministry.

“You are the one who keeps spreading lies and blaming us (Ministry of Energy officials) for nothing,” Kabagambe reportedly shot back.

Museveni who had called the meeting to find ways of ensuring that such squabbling does not happen looked on as several people shifted in their seats.

 (L-R) Kabagambe Kaliisa, Harrison Mutikanga and Stephen Isabalijja
(L-R) Kabagambe Kaliisa, Harrison Mutikanga and Stephen Isabalijja

People at the meeting told The Independent that seeing how Isabalija appeared very confident as he took on the most powerful man in the Energy ministry spoke volumes. It added another item on the list of fights that Isabalija’s camp has been winning against the officials at the Energy Ministry.

Isabalija has earned his space at the top echelons of the energy sector by winning the audience of President Museveni and specifically exposing the shoddy works in the projects. Until recently, Isabalija’s biggest challenge has been the resistance from officials at the Energy Ministry.

Isabalijja convinced the President that his organisation was rightfully mandated to supervise the construction of the two dams and would be responsible for them upon completion. Ministry of Energy officials on the other hand, argued that they were the ones that entered the contract with the contractor; China’s Synohydro and therefore, should be the rightful supervisors of the project.

On the other hand, UEGCL officials argue that they entered a MoU with the Energy and Finance Ministries, which made them the implementing agency. Apart from this, the loan being used to construct the dams is on UEGCL’s books meaning that it is them who will have to repay and not the Energy Ministry.

But UEGCL’s main arguments that got President Museveni to make that directive was that the Ministry of Energy is failing to supervise, is allowing shoddy work, and is leading the projects to over-shoot budgets. President Museveni in April accordingly wrote to the Minister of Energy and the PS to hand over supervision to UEGCL. But, even after the President wrote several follow-up directives, officials at the Ministry of Energy did not comply.

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