Uganda registered growth in the export sector, with receipts increasing by 6.7% monthly and by 52.2% year-over-year, according to the June 2021 Monthly Performance of the Economy Report.
The report, which is released by the finance ministry, shows that export earnings rose to $455.22 million in May 2021 from $426.56 million in April 2021, and from $299.11m in May 2020 to $455.22m in May 2021.
Officials say the growth was seen mainly in non-coffee exports such as mineral products, electricity, tea, beans among others due to increase in their respective volumes.
“Exports excluding receipts from mineral products grew on both annual and monthly basis. Exports rose by 53.3% from USD 172.76 million in May 2020 to USD 264.90 million in May 2021, and by 5.6% between April and May 2021,” reads the report.
It is also important to note that during this period there was improved economic activity following lifting of lockdown measures that had disrupted trade leading to a sharp decline in trade activities during May 2020.
The Middle East remains the largest consumer of Uganda’s merchandise exports, accounting for 42.7% of total exports.
However, there was a slight decline compared to the share (44.3%) recorded in May 2020. Other major destinations included the EAC (25.6%), Rest of Africa (13.64%) and the European Union (11.62%).
While there was an uptick in exports, the merchandise trade deficit widened on both an annual and monthly basis.
“The deficit increased by 50% on a month-on-month basis from USD 269.25 million in April 2021 to USD 322.17 million in May 2021. This was on account of an increase in the import bill, which more than offset the increase in export receipts over the same period,” reads the report.
“Compared to May 2020, the merchandise trade deficit widened by 123% in May 2021, reflecting a recovery in import demand. During the month, the value of imports increased at a much faster rate than the increase in exports.”
The report shows that import receipts increased both on annual and monthly basis during May 2021.
A month-on-month comparison shows imports increasing by 11.7% from USD 695.81 million in April 2021 to USD 777.39 million in May 2021.
Similarly, the value of imports during the month represents a 78.5% rise as compared to the same period last year.
“This increase was attributed to increases in both Government and private sector imports due to improvements in global supply chains following ease of the lockdown measures that had been put in place to contain the spread of COVID-19 back in May 2020,” says the report.
“Government imports increased during the month as a result of an increase in Government project imports.”
The ministry says the lockdown instituted in June 2021 has weakened economic activity.