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CAA dismisses reports of alleged China takeover of Entebbe Airport

KAMPALA, UGANDA: The Civil Aviation Authority of Uganda has dismissed “fake reports” that China is set to take over Entebbe International Airport over government failure to pay back a loan to the Asian nation.

A report by local publication Daily Monitor dated Friday, November 26, 2021, indicated that the money which government borrowed from the Export-Import (Exim) Bank of China in 2015 to expand the airport had some unfavorable provisions in the loan agreement which if not amended, would expose the country’s sovereign assets to attachments and take-over of Entebbe Airport by the Chinese government.

According to Monitor’s report, it was indicated that the loan agreement between the two countries, UCCA is required to set up an “escrow account to hold all of the authority’s revenues.” It was further said that as part of the agreement, the government body mandated to regulate civil aviation in Uganda is not allowed to use the money on the said account without approval from the Chinese government.

However, in response to the media reports on Saturday (today), Uganda Civil Aviation Authority (UCAA) who manage the airport have come out to dismiss the reports as untrue.

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“I wish to make it categorically clear that the allegation that Entebbe Airport has been given away for cash is false. The government of Uganda can’t give away such a national asset. We have said it before and repeat that it has not happened. There isn’t an ounce of truth in it,” UCAA spokesperson, Vianney Luggya said in a statement released on Saturday.

UCAA in its statement admitted that whereas they opened up a sales collection account in Stanbic bank where all its revenues are deposited in line with the Escrow Account Agreement terms, no one else controls the account as reported.

“The Authority enjoys the freedom and liberty of spending what is collected (as per the budget). The lender’s monitoring of the account is only similar to what happens when one gets a salary loan or any other loan and the bank requests that the salary is channeled through their bank. It does not mean that lending bank takes over your salary,” Luggya said.

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“The loan terms provide a grace period of 7 years, and we are still within that grace period during which only interest is paid, and the government has not defaulted on those obligations.”

The saga of airport takeover has since sparked public outrage and scrutiny, especially on social media slaming the government for signing the agreement that might see the country surrender its only international airport to the Chinese government.

On Friday, China dismissed the reports as untrue saying it had no intentions to take over Entebbe Airport over the loan debt.

Which of the Chinese projects in Africa have been confiscated in Africa? None! The hype surrounding the Chinese ‘debt trap’ in Africa have no factual basis and is being pushed on malicious grounds,” China’s Director-General for African Affairs Wu Peng said, dismissing the reports as “illogical propaganda”.


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