The African Development Bank (ADB) is to fund the construction of a regional railway line from Dar Es Salaam through Rwanda to the DR Congo, the bank chief has said.

Dr. Donald Kaberuka also said his bank would further finance the building of another railway line from Mombasa through Uganda to Sudan.

The ADB president said the bank’s new strategy to finance the infrastructure was meant to expand the region’s market size, market diversity, reduce the cost of doing business in the region and also improve relations between the benefiting partner states.

"Yes I agree it (infrastructure linking up the region) would improve understanding amongst the people,” Kaberuka said at a news conference at Serena Hotel, Kampala last week. He said 15 per cent of the bank’s lending would go to the enhancement of the infrastructure sector.

An ADB official based in Kampala had earlier said that the bank had shifted away from financing the social sector to funding infrastructure.

But Kaberuka said the bank’s new line of financing would still boost the social sector.

"I do not agree that infrastructure is not part of the social sector,” he said. The anonymous official said the bank was capable of raising $200m to finance infrastructure in East Africa.

"We are still negotiating with individual governments in the region. We have special money (vote) at the bank for financing the East African railway networks. However, if the project is too big (estimated at $500m) we shall seek co-funding. But our initiative is based on the economic returns and service delivery,” the source said.

Kaberuka also said addition funding to the construction of Kisoro-Cyanika road that links Uganda to Rwanda ; Arusha-Nairobi road that links Tanzania to Kenya and Fort Portal-Bundibudyo road that links Uganda to DRC, would deepen the integration process. The view taken by the bank is that, it is best for our people if we close the infrastructure gap, Kaberuka said.

"Wherever I have been travelling in Africa the message is the same. We are on the right path. We are very keen to support the East African integration,” the bank chief said.

Over the last five years East Africa has had an economic growth rate of over 5 percent but the overwhelming rising population growth coupled with high costs of transport and an energy crisis is threatening to reverse the growth.

Africa is still at crossroads in respect to global trade because of unfavourable infrastructure in some parts and non-existent infrastructure in the other parts of the continent.

Corruption

Meanwhile, Kaberuka warned the East African governments against misusing the funds his bank had allocated them. He said, "The bank is very keen to see that any money given to any government is used for the purpose it is meant to be used. It should achieve the necessary objective. We want the highest standards of governance.”

He said they had not received any corruption cases yet but added, "If any cases arise we shall take it seriously.” Kaberuka, who was on a three-day state visit to Uganda, revealed, he would be visiting Rwanda next month.

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