Uganda’s merchandise trade deficit narrowed for the fourth consecutive month in December as exports continued to grow faster than imports, albeit at a slower pace.
The trade deficit in goods fell 10.9 per cent on the year to $269.9mn, faster than the 0.3 per cent decline in the previous month, according to Bank of Uganda figures. It also narrowed from $299.7mn in November.
Merchandise exports rose 65.8 per cent to $616.4mn, while goods imports to Uganda climbed 31.4 per cent to $886.2mn. Growth in both exports and imports slowed from 83.2 per cent and 43.8 per cent respectively in the previous month.
Gold exports were by far the largest contributor to the growth in outbound shipments, rising by $225.9mn to $241.3mn, less than the $258.2mn increase in November. Coffee export receipts, on the other hand, increased by 10.8 per cent to $65.9mn, faster than the 10.2 per cent growth in the previous month.
The narrowing of the trade deficit should help boost growth in the last quarter of 2023. The central bank on Tuesday forecast growth of 6 per cent for the current fiscal year (July 2023 to June 2024), supported by the recovery in external demand, low inflation, and investment spending.
