Uganda Airlines is set to receive enhanced government funding in the fiscal year 2025/26 to accelerate fleet expansion and route development, according to official budget documents and airline disclosures.
Budget Allocation & Funding Strategy
As part of Uganda’s UGX 6.92 trillion (USD 1.92 billion) national transport infrastructure budget for 2025/26, Finance Minister Matia Kasaija confirmed that Uganda Airlines will receive recapitalization support aimed at acquiring additional aircraft and strengthening its route network. budget.finance.go.ug.
Although the exact allocation amount was not announced, subgroup documentation emphasizes a push to enhance integrated transport services across air, road, and rail sectors AirGuide.
Fleet Expansion and Aircraft Plans
Uganda Airlines currently operates a fleet consisting of:
- 4 Bombardier CRJ900LR regional jets
- 2 Airbus A330-800neo widebodies
Upcoming fleet growth includes:
- Planned leasing of 1 A320-200 and 1 A321-200 by October 2025
- Planned acquisition of 2 A320neo and 2 A321neo per ch-aviation.
- Authorization to wet-lease a Boeing 737-800 freighter, with ongoing talks for two Boeing 787 long-haul jets for a future Guangzhou–Entebbe route in 2026.
Route Network and Market Share Growth
Today, Uganda Airlines serves 17 destinations, including its recent long-haul entry to London Gatwick, launched in May 2025. The airline’s market share at Entebbe Airport has increased significantly, from 4% in 2019 to 24% in 2023/24.
Revenue has surged from UGX 28 billion (2019/20) to UGX 319 billion (2023/24), marking a dramatic recovery.
Strategic Implications
This substantial investment reflects the government’s commitment to transitioning Uganda Airlines from its investment phase toward a profit-generating, fully integrated component of national transport infrastructure.
According to Treasury Secretary Ramathan Ggoobi, investments in fleet expansion are foundational, with profitability discussions deferred until after the investment phase is complete.
Contextual Risks and Regulatory Considerations
While expanding fleets and international routes can enhance connectivity, critics and analysts warn of:
- Risk of overcapacity, especially if new widebody routes underperform
- Heavy government subsidy dependency in the absence of transparent profitability targets
- Regulatory and certification delays for new aircraft types, such as A320neo and 787
Partnerships & Global Strategy
Uganda Airlines has previously:
- Extended ACMI leasing arrangements via DAT Group (Lithuania)
- Developed cargo leasing partnerships (B737-800 freighter)
Plans for eventual China-Uganda operations (pending Boeing 787 availability) reflect ambitions for broader international connectivity.
The Road Ahead
- Aircraft Delivery: Leasing and procurement of A320/A321 jets adds capacity for intra-Africa and medium-haul markets.
- Route Growth: Focus extends on new cargo capabilities and long-haul destinations like Guangzhou, with freighter capability enabling new logistics pathways.
- Profit Pathway: The airline enters a transition from investment to revenue-driven operations, although commercial performance with new assets remains to be seen.
Uganda Airlines’ 2025/26 budget appropriation signals a new strategic phase: aggressive fleet and route development aimed at elevating the airline’s role in national transport and economic growth. With sustained government support and mindful execution, Uganda stands poised to strengthen its aviation sector, although execution risks and global market volatility remain key concerns.
