WASHINGTON - The World Bank believes a controversial hydroelectric dam project in Uganda is economically viable and it supports that government's efforts to protect the environment, the bank said in a statement released.
The bank was replying to issues raised by its own Inspection Panel - an independent branch of the World Bank - which said in a recent report that the project to build the 250 megawatt Bujagali dam on the Nile could cause environmental damage and might not be completely sound economically. The concerns echoed criticism by nongovernmental organizations.
A bank official told Reuters the project was financially viable and the bank backed a government pledge to protect the Kalagala falls and the natural habitat around them.
The bank was negotiating with the Multilateral Investment Guarantee Agency (MIGA) for about $250 million of the $550 million project, a contribution that is vital if the dam is to be built, the official said.
The Bujagali project was approved by the bank last year to increase the number of people in Uganda who have access to electrical power from the current three percent of the population.:
