Uganda’s economy sees impressive growth as trade deficits shrink and exports surge

By Chinedu Okafor

According to Uganda’s finance ministry, the nation’s yearly and monthly trade deficits with the rest of the world have decreased as a result of rising export revenues that have more than offset rising import costs.

The finance ministry’s monthly report on the state of the economy for July 2023 states, “Between May and June 2023, the merchandise trade deficit narrowed by 12.3 percent from US$82.08 million to US$247.43 million. Year-on-year, the merchandise trade deficit narrowed by 32.2 percent from US$365.11 million in June 2022 to US$247.43 million in June 2023,” the report shows.

According to an interview with the Ministry Head of Communications Apollo Munghinda, Uganda exported goods valued at US$650.57 million in June 2023. “This represented an 11.1 percent increase when compared to US$585.81 million exported during May 2023. This increase was mainly on account of higher export earnings from beans, simsim, cotton, and gold registered during the month,” he noted.

Additionally, according to Munghinda, within the same time period, coffee export receipts for the month were US$90.56 million, up 23.6 percent from US$73.26 million in May 2023. This increase was mostly related to the increased price of Robusta coffee on the international market, which encouraged exporters to remove beans from their warehouses for sale.

The monthly economic performance report for July also reveals that, with 33.9 percent of the market share, the East African Community (EAC) continued to be Uganda’s largest export market in June 2023.