KAMPALA, (Reuters) – Uganda has returned to Ireland $5 million of aid money that was embezzled by state officials, it said yesterday, promising to reimburse other governments in the hope of unblocking vital payments.
Major Western donors cut off aid to Uganda late last year, saying a total of about $13 million of aid had been stolen. By reimbursing Ireland, Uganda hopes to thaw the aid freeze which risked putting a 0.7 percent dent in economic growth.
“We have refunded them the equivalent of 4 million euros ($5.23 million),”
Keith Muhakanizi, deputy secretary to the Treasury, told Reuters.
“The government of Ireland has confirmed it will not take away the money, but it will use it for the same purpose, in northern Uganda.”
The stolen money was meant for reconstruction projects in Uganda’s north and north-west after years of insurgency. The other donor countries affected include Britain, Denmark and Norway.
Muhakanizi said that although Ireland was the only donor to be repaid so far, all other countries found to have had funds misappropriated would be reimbursed once audits are complete.
“We have found the money – as soon as I get the procedures of payment we shall pay, hopefully by the end of this week,” he said.
Muhakanizi said the government had “sacrificed some few things here and there,” to be able to raise the money to reimburse donors, but did not give more details on where the money had been found.
Uganda’s government has said it will punish all officials involved in the embezzlement. Several officials have been charged. Donor funding accounts for up to a quarter of Uganda’s annual budget.