For decades, the road linking Koboko-Yumbe-Moyo has been in dire state making it impassable especially during rainy seasons.
On Friday, World Bank Board of Directors approved a grant of $130.8 million from the International Development Association (IDA) to tarmac the road.
Once tarmacked, the road will ease the movement of goods and people and improve access to social services and job opportunities in the refugee hosting districts in the West Nile sub-region.
The road will be financed through the IDA18 Window for Host Communities and Refugees.
The Uganda Roads and Bridges in the Refugee Hosting Districts Project will upgrade 105 kilometre (km) Koboko-Yumbe-Moyo road from gravel to bitumen and strengthen the institutional capacity of the Uganda National Roads Authority (UNRA) to manage environmental, social, and road safety risks.
The World Bank Country Manager, Mr Tony Thompson, said: “This road project marks our re-engagement and strong support for the transport sector, a key development pillar in Uganda. We expect it to bring economic and social benefits to both hosting communities and refugees and reduce the income disparities between West Nile and the rest of Uganda.”
Construction work expected to start next year after the contractor is selected.
Mr Thomson said the project will foster greater regional integration through trade with DR Congo and South Sudan by reducing travel time and create employment for youth and women.
Uganda currently hosts the largest number of refugees in Africa and the third largest in the world. Around 57 percent of the 1.4 million refugees in Uganda live in the northern region, having come from South Sudan and the DR Congo.
The proposed road corridor is the lifeline for the host and the refugee population of the districts of Koboko, Yumbe and Moyo.
It passes close to Bidibidi (the most populous refugee settlement in Africa), Lobule, and Palorinya refugee settlements directly impacting 360,177 refugees and indirectly benefiting 810,529 refugees within the region.
Most refugee settlements are in rural and remote locations which increases the challenges for local development and posing challenges to refugees and host communities.
The Koboko-Yumbe-Moyo project complements other transport investments by the World Bank Group in Uganda.
The historical lack of development in West Nile, combined with the continued inflow of refugees, has added pressure on public services and infrastructure.
Dr Kenneth Muniina, the UNRA Refugee Roads Manager said the road will be upgraded to Class II Bituminous Standard with a typical rural cross-section 7 meters carriageway and two metres paved shoulders on each side.