Why Uganda needs to promote her exports

Uganda targets to become a middle status income country with a projected export performance of more than $8,000 million by 2020.To achieve this, the contribution of exports to Gross Domestic Product (GDP) is paramount. Available data demonstrates the high propensity for Ugandans to engage in import trade and in domestic commerce as opposed to export trade.

Uganda’s export performance is still very low with export to import ratio of 51 per cent. Uganda imports more than what she exports, creating a negative trade balance. Uganda’s total merchandise exports were worth $2.73 billion 2015 while merchandise imports into Uganda reached $6.065 billion in 2015. Trade deficit reached $3.3 billion in 2015.

Key manufactured exports to regional markets (2015)
Base Metals & Products –$120 million; cement – $80 million; Edible Fats & Oils –$38.7 million; Sugar - $66 million; Plastic Products – $34.5 million; and soap – $26.7 million. (Sources UBoS; BoU 2016)

Top 10 exports
10 Key Ugandan exports ($Value 2015): Coffee – over $400million; Fish & products – over $170 million (incl. informal exports); maize - over $86million (includes informal exports); tobacco – $89million; tea – $66million; hides & skins – $62million; Cocoa beans - $60million; Other livestock/dairy - $60 million; Sim sim - $52million; flowers - $51 million; Beans - $60mio (includes informal exports). (Sources UBoS; BoU 2016)
Uganda Bureau of Statistics census of business data 2010/ 2011 shows that of the 458,106 business establishments in Uganda that year, nearly 61 per cent were in the import trade. We need to reverse this. There is a need for increasing export trade. It takes strategy. It takes commitment from key stakeholders.

Projections
Uganda can increase exports. Government projections indicate that when the necessary preparations and coordination have been done, exports should amount to over $8 billion. This is what is projected in the National Development Plan II (NDPII) and the export strategy.
We have an opportunity to increase exports and the regional markets are currently Uganda’s main export destinations. Members of East African Community (EAC) and Common Market for Eastern and Southern Africa (Comesa) are our number one market for manufactured and non-value added products. The European Union (EU) is our number two exports destination. We have new markets emerging from Asia – such India and China.
Working with the private sector, the government has identified priority commodities and service exports. The framework for selection of priority commodities and services was based on the second National Development Plan (NDPII) and National Export Development Strategy 2015/16-2019/20.

Commodities
The selected commodities of focus include agricultural commodities: Coffee and coffee products, Tea and tea products, fish and fish products, livestock and livestock products (dairy and beef; hides and skins), grains products (maize and beans), horticulture crops, and cotton and cotton products.

Services
Services include tourism, and ICT. The selected commodities and their value chains including processed products and services can be regarded as ‘low handing fruits’. We can add cocoa beans on this list. As a strategy of increasing exports, it is important to start with the ‘low handing fruits’ – what you can take to the export market within at least three years. Investment for the production and exports of minerals and mineral products focusing mainly on iron-ore, steel and dimension stones and oil has been considered.

Elly Twineyo Kamugisha is the executive director Uganda Export Promotion Board.

The export week

The Export Week scheduled to take place from December 5 - 9 at UMA Conference Hall Gardens will commence with an Export Walk that will start off at Centenary Park to UMA Conference Hall at UMA Show Grounds Lugogo. There will be an exhibition from showcasing exportable products and services at UMA Conference Hall Gardens at Lugogo. The minister of Trade, Ms Amelia Kyambadde, will lead the business community and the general public into an Export Week with 5 key activities: the Export Walk, an exhibition, Export Clinics, and the Exporters’ Conference. President Yoweri Museveni, is expected to honour the week by recognising the best performing exporters of 2015 at Imperial Royal Hotel on December 8.

Why emphasise export market development?

We have to increase the volume and value of the country’s exports by focusing on export-led production and penetrating markets. Without an export-led production approach (i.e. deliberately producing for the market, especially export markets not subsistence), exports will not grow fast. There is need for the creation, expansion and sustainability of the export markets.

To facilitate this, Uganda has negotiated or been offered preferential market access to the markets and regions including the EAC, Comesa, EU, USA, India and China. However, Uganda’s exports to some of these markets are dismal mainly due to the political situation in some countries (our export markets), conformity to buyer and market requirements, competitiveness and capacity to supply.

To penetrate markets requires market information about buyers (who are they? where are they? their size), entry requirements (such as standards) and knowledge regarding the politics and society generally. Since most of the exporters are SMEs, Uganda Export Promotion Board (UEPB) aims at supporting the private sector with the right information about the export markets. Not only supply right information but also support them with export promotion activities (engaging buyers and exporters in buyer/seller mission, targeted promotions and exhibitions).

Exports matter to Uganda for GDP growth, employment, and taxes, among others. Let us all commit to boosting production, handling, and marketing of exports. UEPB will coordinate all export-related efforts geared to export development and promotion.