Trade deficit narrows on export growth but coffee drops for 12th straight month

Exports in October rise faster than imports but coffee continues bad run

Uganda’s merchandise goods trade position with the rest of the world improved for the second straight month in October as exports rose faster than imports, Bank of Uganda figures show.

The merchandise trade deficit decreased by 2.2% to $199.1 million from $203.6m a year earlier. In September, the goods trade deficit fell 26.8% (revised) year on year.

The contraction in the deficit was due mainly to a 16.8% increase in the value of goods exports to $333.9m, knocking back the impact of an 8.9% rise in merchandise imports to $533m.

October’s growth in merchandise exports was slower than September’s rate of 17.9% (revised), but still the second strongest since February; goods exports also posted their highest value in nine months.

Goods imports, on the other hand, recovered after their first annual decline in 13 months, a 3.2% contraction in September. Total private sector imports rose 18.1%, driven by a $91.6m increase in non-oil imports, while oil imports increased by 32.1% year on year to $91.9m. Government imports reduced by $37m to $7.9m.

Just like in October, the year on year increase in goods exports was driven by growth in gold shipments. The value of gold exports rose 89.2% to $78.8m, making the metal Uganda’s most valuable export commodity in the month.

Other commodities responsible for the increase in total exports were tobacco receipts which posted an annual growth of 66.6% to come in at $15.9m, and extra-regional exports of fish and related products that rose by $3.7m to $15.6m.

Coffee exports fell 19.5% to $35.3m, marking 12 straight months their year on year value has declined.