Uganda’s goods imports dropped at the sharpest rate since May 1999 in March, leading to the narrowest merchandise trade deficit in 12 months, according to data released by the central bank.
The goods trade deficit fell to $176.7m (Shs669.8bn) in March, from $143.6m a year ago, a decline of 23% and the fastest in six months.
The narrowing in the merchandise trade deficit was driven by a 34.2% year on year fall in goods imports to $492.2m (Shs1.8 trillion), the steepest annual pace of decline since May 1999.
Goods exports also declined at the fastest annual pace since May 1998, falling to $315.5m (Shs1.2 trillion) from $603.9m in March 2019, or a fall of 47.8%.
Formal private sector imports reduced to $454.8m, falling 35.1% year on year, with non-oil imports down 38.7% while oil imports declined by 5.5%, the fastest in four months. The drop in formal private sector imports was primarily driven by a reduction in mineral products, excluding petroleum goods, whose value came in at $63.8m from $312.7m a year ago.
Government imports fell 25.9% year on year, reflecting a decline in project imports.
On a monthly basis, formal private sector imports reduced by $67.2m, largely the result of a fall in imports of mineral products (excluding petroleum goods) by $27.1m, a decline in machinery equipment, vehicles and accessories of $16.5m, and imports of petroleum products, whose value reduced by $9.5m.
Goods exports declined mainly due to a slowdown in gold shipments, which came in at $60.9m down from $363.4m in March 2019. Those gold exports a year ago were, however, an anomaly and juiced by gold smuggled into the country from Venezuela.
Merchandise exports were down 11.4% on the month, with gold shipments falling 31.7%. Oil re-exports reduced by 27.9% to $8.2m, formal maize shipments fell $7.8m, down 28.7%, and cotton exports reduced by 43.7% to $3.9m.