Uganda’s GDP growth robust at start of 2018

Activity in Uganda’s real economy in the first three months of 2018 improved at a healthy rate from the same period a year earlier, according to seasonally adjusted data from the statistics bureau.

Gross domestic product, the primary indicator of economic activity within Uganda, was estimated to have increased by 6% year-on-year in the quarter. Still, the economy lost a little pace as that rate was lower than the 6.5% (revised) growth rate recorded in the last three months of 2017, and the second straight drop in annual quarterly GDP growth rates.

The annual growth in output was helped by rises in information and communication activities, trade and repairs, construction activities, and in manufacturing activities.

The value added in information and communication posted an annual increase of 15.6% mainly due to an increase in telecommunication activities, while trade and repairs activities rose 6.7% year-on-year. The two sub-sectors are part of the services sector which contributed 53.2% to total GDP in the quarter and expanded by 8.2% from the same quarter last year.

Construction activities and manufacturing, both classified under the industry sector, recorded yearly growths of 9.4% and 8%, respectively. Output in the industry sector rose 9.4% year-on-year and contributed 19% to total output in the quarter.

Agriculture, forestry, and fishing activities expanded by only 0.6% from the same quarter last year, on the other hand. Food crops output, the largest category in the sector, rose 0.8% while livestock and forestry activities increased by 3.3% and 1.5%, respectively. The value added by cash crops fell 4.7% year-on-year.

GDP growth was 1.1% between quarter 4 of 2017 and the first three months of 2018, the same quarter-on-quarter growth rate (revised) registered in Q4 of 2017. The total value added came up to Shs15.4 trillion, up from Shs15.2 trillion in the previous quarter.

Growth between the two quarters was driven by value added in the services sector, particularly in information and communication activities. Expansion in the construction sub-sector also contributed significantly to GDP growth between the two quarters, as well as financial and insurance activities and manufacturing.