Africa-Press – Uganda. The decline in Uganda import volume- coupled with increased earnings from exports helped the country to see a 15.6% narrow down in trade deficit for some imports.
The merchandise trade deficit narrowed by 15.68 percent from $271.46 million in December 2021 to $228.88 million in January 2022, according to a monthly economy performance February 2022 finance ministry report seen by this reporter.
“This was due to both a4.9% decrease in imports (by 4.9%) and a 4.1% increase in exports,” the report reads.
The same report indicates that export receipts increased for the fourth consecutive month, amounting to $339.22 million in January 2022 with an increase of 4.1% from $325.77 million registered in December 2021.
This development, government says, followed an increase in the export receipts of maize, sugar, cotton and beans following higher export volumes. Export volumes of maize increased from 8,077 tonnes in December to 20,016 tonnes in January 2022.
However, in comparison between January 2021 and January 2022 there was a 17.3 percent decline in export receipts from $ 410.40 million to $339.22 million.
In January 2022, the rest of Africa took the largest share of Uganda‘s exports (36.2%). In particular, export receipts to DRC more than doubled increasing from $44.27 million in January 2021 to $102.52 million in January 2022.
The East African Community and the European Union accounted for second and third shares of trade by value terms taking up 35.2% and 16.7% respectively.
“The value of merchandise imports registered a decline of 4.9 percent to $568.10 million in January 2022, from $597.22 million recorded in December 2021,” shows the report.
The ministry of finance said this development was on account of a 9.7 percent decline in import volumes.
Covid impact
Both government and private sector imports registered lower volumes in January, with government partly attributing that to a protest by cross-border truck drivers after Uganda introduced mandatory Covid-19 testing for truckers in January.
“The decline in import volumes more than offset the price increases recorded for some import categories, leading to a decline in the value of merchandise imported,” the report explains.
Trade deficit
During the month of January 2022, 39.5 percent of Uganda‘s imports originated from Asia, 16.3% from the East African Community, and 15.4 percent from the Middle East.
Total imports from Asia amounted to $224.42 million in January 2022, of which China contributed 39.4% whereas India and Japan contributed 28.4% and 9.0%, respectively.
In regard to trade balance by region, government said “Uganda posted a merchandise trade surplus with the rest of Africa and the EAC and deficits with the other regions.”
The country recorded the largest merchandise trade deficit with Asia while the biggest trade surplus was with the Rest of Africa.
This publication understands that the merchandise trade surplus with the rest of Africa increased from $4.26 million in January 2021 to $99.04 million in January 2022 following higher exports to DRC.
According to the report Uganda’s trade deficit with Asia widened to $201.14 million in January, from $179.98 million last year.
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