(Bloomberg) -- President Yoweri Museveni called the World Bank’s decision to stop new funding to Uganda over recently passed anti-LGBTQ legislation a “provocation and arrogance” meant to intimidate the nation.
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“Some of these imperialist actors are insufferable,” Museveni said in a statement Thursday. “You have to work hard, to restrain yourself from exploding with anger. They are so shallow, they do not know when and where to stop.”
The shilling fell by the most in almost eight years after the World Bank announced the halt in funding last week. The government announced that it would revise its 2023-24 budget to take into account the loss of financing.
In addition, the central bank cut rates on Tuesday to underpin output and said it would do “what it takes” to stabilize the local currency’s exchange rate after the rout. Earlier on Thursday, the Finance Ministry said it would switch a 10-year bond maturing in January with other securities to lengthen its maturity and not to raise fresh cash.
The World Bank was making a mistake by thinking that Ugandans can be “intimidated by the threat of withdrawal of loans and aid, that are, moreover, peripheral to our transformation efforts,” Museveni said.
A spokesperson for the World Bank didn’t immediately respond to an emailed request for comment.
The president in May signed legislation that includes the death penalty for so-called “aggravated homosexuality,” defined in part as engaging in sex if one is HIV-positive. The World Bank, whose portfolio of International Development Association funding to the country was $5.4 billion at the end of 2022, said the law contradicts its values.
Foreign aid and loans, while welcome and useful, have been a “source of distortion and stunted growth” across Africa, Museveni said in his 25-page statement.
Aid has been an important part of budget financing for Uganda.
He commended the World Bank for supporting health and education programs, while criticising the Washington-based lender for not funding projects such as railways and power generation.
An external funding freeze will not interrupt the economy’s progress, Museveni said. The real disruptions are domestic weaknesses such as corruption and an inept civil service, he said.
“If you have a certain view-point about homosexuality, we have a different one,” he said. “Your attempt to coerce us puts you together with the chauvinists. Our stable partners in the Western countries need to be aware of this.”
(Updates with president’s comments from sixth paragraph)
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