Uganda is in advanced stages of issuing its first sovereign sukuk to cover 15% of a $3.17 billion Standard Gauge Railway project, with 60% expected from export credit agencies and 25% from development finance institutions.
Uganda’s finance ministry has announced that the country is in advanced stages of issuing its inaugural sovereign sukuk (Islamic bond) to finance part of a $3.17 billion Standard Gauge Railway project, according to official disclosures posted on X. The sukuk will cover 15% of the total project cost. The remaining financing is expected to come from export credit agencies (60%) and development finance institutions (25%).
Deputy secretary to the treasury Patrick Ocailap is leading a sukuk roadshow to Kenya and Tanzania to gauge demand and support price discovery ahead of issuance. The delegation includes representatives from Stanbic Bank Group, the central bank, and the railway project team.
This development matters because sovereign sukuk issuance remains limited in East Africa, and Uganda’s debut would open a new funding channel for infrastructure.
Islamic bonds are asset-backed or asset-based, making them suitable for large-scale transport assets. The Standard Gauge Railway is a strategic regional project intended to improve freight and passenger connectivity within East Africa and reduce transport costs to the Indian Ocean port of Mombasa. Industries impacted include railway construction, Islamic finance, and export credit insurance.
Regional stakeholders include Kenya and Tanzania as transit neighbors, export credit agencies, and development finance institutions.
For investors, the sukuk offers exposure to a sovereign infrastructure project in a frontier market, though risks include execution delays, currency volatility, and regional competition with existing rail corridors. The roadshow suggests the government seeks anchor commitments before final pricing.
Uganda’s finance ministry is the government authority responsible for fiscal policy, public finance management, and infrastructure financing.
Stanbic Bank Group is a regional banking group active in East Africa, involved in the sukuk roadshow as a financial partner.
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