The World Bank has stopped lending the Ugandan government saying on Tuesday that the new anti-LGBTQ law of the east African country is against the Bank’s laws. Many countries worldwide have condemned the new law.
Uganda has rejected the action of the international financial institution as unjust and hypocritical.
After the law first came in action in May, a team from the World Bank soon visited Uganda and was committed to ensure that more measures were needed to ascertain that the institution’s projects in the country are executed as per the bank’s environmental and social standards.
In a statement, the bank said, “No new public financing to Uganda will be presented to our Board of Executive Directors until the efficacy of the additional measures has been tested.” It added that these and other measures were being discussed with Ugandan authorities.
It also said, “Uganda’s Anti-Homosexuality Act fundamentally contradicts the World Bank Group’s values. We believe our vision to eradicate poverty on a livable planet can only succeed if it includes everyone irrespective of race, gender, or sexuality. We remain committed to helping all Ugandans – without exception – escape poverty, access vital services, and improve their lives.”
Pressure has been put on World Bank President Ajay Banga, who assumed office in June after the Ugandan law was passed, to respond to it. On June 15, 170 civic organisations called on Banga to take “specific, concrete and timely actions” in reaction to the anti-LGBTQ bill in Uganda, including stopping all lending.
Okello Oryem, the state minister for foreign affairs in Uganda, charged the bank with hypocrisy by claiming that it was making loans to nations in the Middle East and Asia that had similar or stricter prohibitions against homosexuality.
In this regard, he said, “There are many Middle East countries who do not tolerate homosexuals, they actually hang and execute homosexuals, in the United States of America many states have passed laws that are either against or restrict activities of homosexuality … so why pick on Uganda? The World Bank has been put under pressure by the usual imperialists.”
By the end of 2022, the World Bank had given Uganda $5.4 billion in International Development Association money, including numerous health and education projects that the new law may have an impact on.
Even though new loan has been suspended, the current portfolio will still make payments, according to a World Bank source.
The International Finance Corporation and the Multilateral Investment Guarantee Agency (MIGA) would only support private sector projects that would move forward “on a selective basis,” the bank stated in a separate message to staff that was obtained by Reuters.
It stated that extra steps would be taken by the IFC and MIGA to “ensure inclusion and non-discrimination as needed.”