The works transport and communication minister, John Nasassira has this afternoon signed a contract with SBI road Construction Company, to construct the Kabale-Kisoro-Bunagana road.
Under the contract, SBI Construction Company will upgrade Kabale-Kisoro-Bunagana road to a paved standard.
Nasasira said construction work had delayed because of the global increase in the prices of various inputs required for road construction such as bitumen, cement and steel.
He said that having realized that the financing gap could not be closed using its own resources, the Government of Uganda requested a supplementary loan from the African Development Fund in order to implement the project as initially conceived.
In January, the African Development Fund said that although the re-evaluated unit cost of the road is significantly higher than the appraisal estimate, it is still within the range for similar African road projects in regions of difficult access tendered in recent time.
Nasasira says that more than 150 billion shillings would be spent on the construction. Three billion shillings would be used to compensate people who may be displaced by the road works.
Nasasira said the road will promote regional integration and economic co-operation with the neighbouring countries, such as the Democratic Republic of Congo and Rwanda, and reinforce the level of service and efficiency of the road network.