World Bank Resumes Funding to Uganda After Nearly Two-Year Suspension Over Anti-Homosexuality Law

 

The World Bank has officially resumed financial support to Uganda, nearly two years after halting funding due to the country’s highly controversial Anti-Homosexuality Act (AHA). The initial suspension, which took effect in August 2023, followed the Ugandan Parliament’s approval of a law that imposed some of the harshest penalties in the world for same-sex relationships — including life imprisonment and even the death penalty.

Why the World Bank Suspended Funding to Uganda

In August 2023, Uganda became the center of international outrage after its Parliament passed the Anti-Homosexuality Act, a sweeping piece of legislation that criminalized same-sex relations in extreme terms. The law, which was later signed by President Yoweri Museveni, included capital punishment for what it termed “aggravated homosexuality,” a category that covers cases involving minors, individuals with disabilities, or situations where HIV transmission is alleged during same-sex acts.

In addition to the death penalty, the law also introduced up to 20 years imprisonment for the “promotion of homosexuality.” This clause has been widely criticized as overly broad and has raised concerns about freedom of speech and expression within Uganda.

The World Bank, one of the largest external financiers of Uganda’s development efforts, particularly in infrastructure, transport, and public services, responded swiftly. In a strong stance against what it called a violation of its foundational values, the Bank suspended all new project financing to Uganda.

“The law is not consistent with the World Bank Group’s values,” the institution said at the time, emphasizing its commitment to inclusivity and non-discrimination.

This move placed Uganda under immense pressure, both financially and diplomatically. Several donor countries and human rights organizations also condemned the legislation, accusing Uganda of backsliding on its international human rights obligations.

World Bank Cites Satisfactory Safeguards in Ongoing Projects

Fast forward to Thursday, June 5, 2025, the World Bank confirmed it is now ready to resume funding to Uganda, stating that necessary corrective measures have been put in place to ensure compliance with its ethical standards.

“We have now determined the mitigation measures rolled out over the last several months in all ongoing projects in Uganda to be satisfactory,” a World Bank spokesperson told Reuters.

Although the Bank has not reversed its earlier condemnation of the Anti-Homosexuality Act, the resumption of funding appears to mark a shift in strategy — balancing Uganda’s pressing development needs with continued concern over human rights.

According to the World Bank, these safeguards are designed to ensure that vulnerable groups are protected within the scope of its funded projects and that no one is excluded from benefiting based on sexual orientation or gender identity.

New Projects Approved in Key Sectors

As part of its renewed engagement with Uganda, the World Bank has approved three new development projects. These projects are targeted at key areas of social need:

• Social protection: Programs that aim to support the poor and vulnerable populations.

• Education: Investments in infrastructure, learning materials, and teacher training to improve access and quality.

• Support for refugees and internally displaced persons (IDPs): Uganda currently hosts one of the largest refugee populations in Africa, and support for this group remains a national priority.

These initiatives, approved by the World Bank’s Board of Directors, are expected to directly address urgent development challenges, improve livelihoods, and strengthen Uganda’s social safety nets.

The new funding comes at a crucial time. Uganda has been grappling with the economic aftershocks of the COVID-19 pandemic, rising inflation, and high youth unemployment. The resumption of World Bank support could help stabilize several key sectors and rejuvenate stalled projects.

Uganda’s Development Goals and Donor Dilemma

The return of World Bank funding also revives a sensitive debate about donor influence versus national sovereignty. When the funding was initially suspended, Ugandan officials and some domestic commentators accused Western institutions of trying to impose foreign values on a sovereign nation. Others, however, argued that accepting international aid comes with responsibilities — including adherence to globally accepted human rights standards.

The Ugandan government, led by President Museveni, has remained largely defiant in the face of international criticism. Museveni has publicly defended the Anti-Homosexuality Act, saying it reflects the cultural and moral values of the Ugandan people.

Yet, the World Bank’s decision to resume aid despite the law still being in place signals a pragmatic turn. The institution appears to be attempting a delicate balancing act — ensuring development aid reaches those in need while keeping pressure on Uganda to reconsider or reform discriminatory practices.

Continued International Condemnation of Uganda’s Anti-LGBTQ Law

It’s important to note that while the World Bank has resumed financial support, international condemnation of the Anti-Homosexuality Act remains strong. Human rights groups, LGBTQ+ activists, and even some Western governments have called for the repeal or significant amendment of the law.

Critics argue that the legislation has not only legitimized discrimination but has also fueled a climate of fear and persecution. Reports from international watchdogs have documented a rise in violence, harassment, and arbitrary arrests targeting LGBTQ+ individuals in Uganda since the law’s enactment.

“Resuming funding while the law remains in force sends a mixed message,” said one international human rights advocate. “It tells Uganda that development goals may outweigh basic human rights.”

Still, the World Bank maintains that its mission is to eliminate poverty and boost shared prosperity, and that abandoning Uganda entirely would only hurt the poorest and most vulnerable communities.

A Complex Tug-of-War Between Development and Rights

This development highlights the complex relationship between global financial institutions and national governments, especially in countries with controversial laws or governance records.

While the World Bank has not endorsed Uganda’s anti-LGBTQ legislation, its funding decision shows that development financing often requires compromise. The institution seems to be relying on project-level safeguards to ensure that funds are not used in ways that support discrimination, while still keeping vital programs running.

Whether this approach will lead to positive changes on the ground remains to be seen. Some observers worry that resuming aid could reduce pressure on Uganda to repeal or amend the Anti-Homosexuality Act. Others hope that continued engagement could serve as a bridge for dialogue and reform.

What This Means for Other African Countries

Uganda’s situation could serve as a case study for other African nations that are navigating similar tensions between traditional values and international human rights standards. Several countries in the region have also introduced or debated anti-LGBTQ laws, often citing cultural or religious reasons.

Donors like the World Bank are increasingly having to make difficult decisions: Should they withhold aid over human rights issues, or engage while pushing for change?

In Uganda’s case, the World Bank has chosen the latter — a move that will undoubtedly shape future discussions around ethical financing, development partnerships, and the limits of donor influence.

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Final Thoughts

The World Bank’s decision to resume funding to Uganda — despite the continued existence of the Anti-Homosexuality Act — underscores the difficult balance between supporting national development and upholding human rights. While the Bank insists that adequate safeguards have been implemented, critics remain concerned about what this means for the broader fight for LGBTQ rights in Africa.

Uganda, for its part, now faces renewed pressure to ensure that development aid is used responsibly and that all citizens — regardless of sexual orientation — are treated with dignity.