(Bloomberg) -- Uganda’s chief legal officer urged the Finance Ministry to refrain from renegotiating the terms of a $200 million Chinese loan as it is able to meet its debt obligations.
The agreement signed in 2015 with the Export-Import Bank of China to fund the expansion of the Entebbe Airport came with several contentious clauses, including one that could see the lender take ownership of the facility in the event of a default.
It’s unnecessary to rework the clauses as the nation is capable of meeting its obligations, Attorney General Kiryowa Kiwanuka was cited as saying in a statement on the Parliament of Uganda’s website.
“Contracts in our view are bad when you put out obligations which are impossible of performance,” Kiwanuka said. “The obligation in this contract is all capable of performance.”
Fears of the airport being taken over by the Chinese are unfounded as Uganda has not yet started repaying the 20-year loan, which came with a seven-year grace period that expires in April next year, he added.
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