World Bank Resumes Funding to Uganda Despite Anti-LGBTQ+ Law

The World Bank has announced the resumption of funding to Uganda, nearly two years after halting new loans in response to the country’s Anti-Homosexuality Act (AHA) of 2023. The law, which drew condemnation from some countries in the “west”, includes some of the harshest penalties against LGBTQ+ individuals in the world, including life imprisonment and the death penalty for what is termed “aggravated homosexuality”.

Despite persistent concerns from human rights organisations, the World Bank says it is now confident that new “mitigation measures” introduced in Uganda can ensure that its funding does not contribute to discrimination or harm. The lender cited satisfactory progress in anti-discrimination safeguards across ongoing projects.

“The World Bank cannot deliver on its mission to end poverty and boost shared prosperity on a liveable planet unless all people can participate in, and benefit from, the projects we finance,” a Bank spokesperson told AFP.

According to the Bank, three new projects in sectors with critical development needs—social protection, education, and forced displacement/refugees—have received Board approval.

Background: A Law That Sparked “western” Outrage

Uganda’s Anti-Homosexuality Act was passed in May 2023, sparking “western” outcry. The law prescribes the death penalty for certain same-sex acts and imposes a 20-year sentence for those found guilty of “promoting” homosexuality. The Ugandan government has defended the legislation, arguing it reflects the conservative values of its citizens.

However, rights groups report a disturbing rise in attacks, evictions, and arrests of individuals perceived to be LGBTQ+. According to the Human Rights Awareness and Promotion Forum, hundreds have been victimised since the law was enacted.

Critics, including Human Rights Watch researcher Oryem Nyeko, have accused the government of using the issue as a political diversion.

“It’s low-hanging fruit. It’s being framed as something foreign and threatening to people’s children,” Nyeko told CBC.

The law’s broad scope has also raised alarm over its implications for civil society and human rights defenders, with fears that those advocating for LGBTQ+ rights could face prosecution.

The Cost of Controversy

Estimates from the UK-based charity Open for Business suggest Uganda lost between $470 million and $1.7 billion in the year following the passage of the AHA, primarily due to frozen aid and project suspensions.

The United States, European Union, and United Nations were among the international actors that publicly condemned the legislation. The U.S. government imposed visa restrictions on officials believed to be involved and launched a review of its financial support to Uganda.

Meanwhile, multinational corporations and NGOs warned that the law could affect investment and the safety of personnel in Uganda.

A Strategic Shift by the World Bank

The World Bank’s renewed engagement suggests a recalibration of its approach. Though Uganda’s legislation remains unchanged, the Bank maintains that it has worked closely with local authorities to mitigate harm in existing and future projects.

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

The Bank remains one of Uganda’s largest external financiers, particularly in infrastructure, including road construction and electricity expansion. The decision to resume funding reflects a broader tension faced by global institutions—balancing development objectives with human rights imperatives.

Uganda’s Minister of Information, Chris Baryomunsi, welcomed the Bank’s decision, calling the initial suspension “uncalled for” and reiterating that the AHA was not designed to “target or discriminate” against individuals.

A Broader Pan-African Context

Uganda is not alone in facing scrutiny over anti-LGBTQ+ laws. Ghana and Kenya have also seen similar legislative proposals, reflecting a wider continental debate over sovereignty, cultural values, and human rights.

While Western governments and institutions call for adherence to international human rights standards, many African leaders view such pressure as neocolonial, asserting that domestic laws reflect their people’s cultural and moral fabric.

The World Bank’s move signals that development institutions may continue engaging with African countries through nuanced frameworks—prioritising progress and inclusion while navigating politically sensitive terrains.