In the Auditor General’s report for the financial year 2024/2025, a review of the Joint Venture Agreement (JVA) between the Government of Uganda and the Dubai-based firm found that, one year after signing, both parties had not met their contractual commitments.

The audit noted that Alpha MBM had not delivered on several critical obligations, including fleet expansion, provision of third-party financial support, introduction of new lines of credit, and implementation of sales and marketing campaigns. The company was also expected to establish strategic partnerships, invest in modern technologies and systems, and support the training and development of crew and staff.

On the government’s part, the report highlighted delays in fulfilling its commitments, including provision of an aircraft, land, a hangar, accommodation and logistical support to the flight crew. Government was also yet to grant flagship route rights and facilitate the use of the Uganda Air Cargo air services licence.

The Auditor General warned that the failure by both parties to honour the JVA terms had undermined the operationalisation and growth of the corporation.

The report further pointed to mounting financial pressures within the entity. Uganda Air Cargo registered outstanding receivables amounting to UGX 33.96 billion as at June 30, 2025, representing a 63 percent increase from UGX 20.76 billion recorded in the previous financial year.

Trade payables also rose to UGX 9.26 billion, up from UGX 6.03 billion, reflecting a 54 percent increase and signalling growing liquidity constraints.

Despite budgeting to earn UGX 18.63 billion in operating revenue, the corporation realised only UGX 12.42 billion by the end of the financial year. Government support also fell short of expectations, with the entity receiving less than projected funding.

In addition, the corporation’s return on assets deteriorated further, dropping from negative 6 percent in the 2023/2024 financial year to negative 22 percent in 2024/2025. The decline was attributed to a number of grounded and non-operational assets, including aircraft.

The findings paint a picture of a struggling national carrier weighed down by unmet contractual obligations, rising debts and underperforming assets.

The Auditor General called for urgent action by both the Government of Uganda and Alpha MBM to fulfil their respective commitments and restore the corporation’s operational capacity.

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