KAMPALA: In June 2024, Uganda’s export and import earnings exhibited notable shifts, revealing key trends in the country’s trade performance. According to the Ministry of Finance’s economic performance report, export earnings amounted to USD 718.60 million, marking a 23.6% decrease from the USD 940.93 million earned in May 2024. The primary cause of this decline was a reduction in export earnings from mineral products. However, excluding mineral products, exports actually increased by 5.1% from USD 446.85 million in May 2024 to USD 469.72 million in June 2024, driven by strong coffee export receipts.
Coffee Exports Surge
Uganda’s coffee exports experienced a significant boost, with earnings rising by 27.5% to USD 162.36 million in June 2024, compared to USD 127.30 million in May 2024. This surge was attributed to both higher export volumes and an increase in international coffee prices. The improved coffee yields, particularly from the Greater Masaka and South Western regions of Uganda, contributed to the volume growth. Internationally, reduced coffee supply from Vietnam and Indonesia due to poor harvests also pushed up prices, benefiting Uganda’s coffee sector.
Italy continued to dominate as the largest destination for Uganda’s coffee exports, accounting for 41.96% of the total coffee exports in June 2024. Other significant markets included Germany (10.55%), India (7.41%), Sudan (6.87%), and Spain (5.40%).
Comparison to 2023
When comparing the performance year-over-year, Uganda’s export earnings in June 2024 reflected an 11.8% increase from USD 642.90 million in June 2023. This growth was primarily driven by increased coffee and electricity export earnings.
Export Destinations
The East African Community (EAC) emerged as the largest destination for Uganda’s exports, accounting for 32.5% of the total in June 2024. Within the EAC, Kenya (30.0%), the Democratic Republic of Congo (28.1%), and South Sudan (21.8%) were the top recipients. Beyond the EAC, other key export destinations included the Middle East (24.5%), the European Union (18.2%), and Asia (18.0%).
This represents a shift from the same period in 2023, when Asia and the EAC were the largest export destinations, accounting for 33.2% and 33.1% of exports, respectively.
Imports Decline
On the import side, Uganda’s merchandise import bill declined by 6.5%, from USD 1,033.50 million in May 2024 to USD 966.53 million in June 2024. The decrease was attributed to lower volumes of non-oil imports, particularly vegetable products, animal products, beverages, fats & oils, and mineral products. However, when compared to June 2023, the import bill grew by 7.6%, driven by higher import volumes of petroleum products, chemicals, and mineral products.
Import Sources Asia remained the largest source of Uganda’s imports, accounting for 34.6% of the total in June 2024, with China and India being the key contributors, representing 46.0% and 27.5% of imports from the region, respectively. Other significant sources of imports included the EAC (19.5%), Rest of Africa (17.2%), and the Middle East (16.8%). Within the EAC, Tanzania (54.1%) and Kenya (42.1%) led as the top sources of Uganda’s imports.
In comparison to June 2023, Asia’s share of Uganda’s imports was slightly higher at 36.9%, while the EAC, Middle East, and Rest of Africa accounted for 26.9%, 15.3%, and 10.5%, respectively.
Analysis and Projections Uganda’s export performance, particularly in coffee, reflects the country’s strength in agricultural production, with higher yields and favorable international market conditions benefiting the sector. However, the decline in mineral product exports raises concerns about diversification and reliance on a narrow range of commodities. On the import side, the decline in non-oil imports may indicate reduced domestic demand for certain goods, while the growth in petroleum and chemical imports suggests ongoing industrial activity.
Projections for the second half of 2024 indicate that Uganda’s trade dynamics will likely continue to be shaped by global commodity price movements, regional trade agreements, and domestic economic policies aimed at promoting export growth and managing import costs.
Quotes According to the Ministry of Finance report, “The rise in international coffee prices was driven by reduced supply from Vietnam and Indonesia, creating a favorable environment for Uganda’s coffee exports.”
A senior economist commented, “While Uganda’s coffee sector remains a key driver of export earnings, there is a need to further diversify exports to cushion the economy from fluctuations in commodity markets.”
