Poaching has risen sharply in recent years across Africa, fuelled by rising demand in Asia for ivory and rhino horn.
Poaching has risen sharply in recent years across Africa, fuelled by rising demand in Asia for ivory and rhino horn, coveted as a traditional medicine and a status symbol. Uganda is a major transit country for the illegal trade.
The Chinese embassy officials are suspected of colluding in the movement of ivory from the Democratic Republic of Congo, the Central African Republic and South Sudan, using Uganda as a transit point, a government official said.
Ali Munira, spokeswoman for the Inspectorate General of Government (IGG) ombudsman, did not name the Chinese diplomats but said the Ugandan Wildlife Authority (UWA) was under suspicion.
The Chinese embassy could not be reached for comment.
Museveni has also ordered a new probe into the theft of ivory worth more than $1-million in November 2014.
"The president's directive to the IGG is to have all these accusations investigated and if there is a prima facie case, the executive director (of the UWA) should be suspended alongside other officials," said Munira.
Five top officials were suspended from the UWA after the disappearance of the 1,335 kilogrammes (2,943 pounds) of ivory from supposedly secure stockpiles.
The outcome of the initial investigation, which involved Interpol, was never made public, although the international police network did carry out sting operations on trafficking networks throughout East Africa in 2015.
A police source involved in earlier investigations said it appeared Museveni was not pleased with the prior probe and that new intelligence showed the likely involvement of Chinese officials.
More than 35,000 elephants are killed across Africa every year for their tusks.