Rwanda, one of Uganda’s top five sources of export revenue, closed its borders with Uganda in February 2019- constructing the movement of people and goods to a bare minimum.
Gold was the leading export revenue earner- accounting for 31% or USD1.3 billion- followed by coffee at 11% or USD438.5 million. Gold earnings have since 2016 replaced coffee as the number one forex earner, on the back of the 2016 set up of a gold refinery in Entebbe, Uganda known as Africa Gold Refinery Limited (AGR).
AGR, according to its owners, is the first of its kind high capacity gold and silver refinery in Sub-Saharan Africa, capable of refining up to a ton of the previous metals on a monthly basis. Immediately after its set up Uganda’s gold export earnings jumped by 850% from USD35.8 million in 2015 to USD340 million in 2016. Since then revenues have been growing at an average 39% per year, touching a historic high of USD1.3 billion in 2019.
The rise in Gold Exports saw the United Arab Emirates, become Uganda’s single biggest source of revenue earnings at USD 1.1942 billion, overtaking Kenya, South Sudan, DRC and Rwanda, who have traditionally Uganda’s leading export revenue earners. The Middle East has also since risen as Uganda’s second biggest export bloc after COMESA. At the end of 2019, exports to Middle East reached USD1.2292 billion, just a few hundred of thousands of dollars behind COMESA which stood at USD1.2297 billion.
Diageo to Exit East African Breweries as Asahi Takes ControlThe Middle East and COMESA are now Uganda’s leading export destinations followed by the European Union. Kenya, Congo DRC and South Sudan and United Arab Emirates are Uganda’s largest country export markets.
Fish and fish by-products (USD176.5 million), base metals/minerals (103.1 million), Sugar (USD83.4 million), Cocoa (USD77.6 million) and Tobacco (67.2 million) are the other leading export revenue earners.
Although Uganda’s import bill is still high- at USD8.2 billion in 2019 compared to the USD4.1 billion export revenue, thus a balance of payments gap of USD4.2 billion, it is important to note that over the last 10 years, export revenue has been growing at 7%, nearly twice faster than the import bill that has been growing at 4% annually. Particularly, over the last 5 years, export revenues have grown by an average 9%- while the economy grew an average 5% powered by the gold cash.
