Bujagali Hydropower appraisal and financing controversy
Risk Mechanism
Appraisal and mitigation arrangements for a lender funded hydropower project were contested through accountability complaints, which alleged insufficient assessment of economic feasibility, affordability, environmental and social impacts, resettlement, compensation, and mitigation implementation risks.
Case Summary
The European Investment Bank recorded a civil-society complaint concerning the Bujagali Hydroelectric Project. The complaint alleged non-compliance with EIB policies, standards, and procedures, and sought suspension of disbursements. The EIB Complaints Mechanism identified issues for further review, including economic feasibility, affordability, resettlement, compensation, blasting effects, spiritual matters, and the Kalagala Offset.
Risk Lesson
This case illustrates how lender-funded infrastructure projects can face accountability challenges when appraisal and mitigation measures remain contested across economic feasibility, affordability, resettlement, compensation, and environmental and social impacts. It highlights warning signs such as unresolved complaints, weak evidence of mitigation implementation, unresolved compensation issues, and continued disbursement before material concerns are addressed.
Reference
European Investment Bank. (n.d.). Bujagali Hydroelectric Project (Complaint SG/E/2009/09). Available from: https://www.eib.org/en/about/accountability/complaints/cases/sg-e-2009-09-bujagali-hydroelectric-project