The effects of Corona virus have started eating into imports and exports trade, according to a report by Bank of Uganda.
The report, which covers the month of February, indicates that Uganda’s export receipt declined by 8.7 per cent while the imports dropped by 7.6 per cent.
According to the report, in February Uganda exported goods worth $352.9m (Shs1.3 trillion) down from $383.6m (Shs1.4 trillion) in January.
Gold, the report shows, was the lead export in the period although revenues from the commodity declined to $89m (Shs329b) down from $104m (Shs384b) in January.
Receipts from coffee also declined by 2 per cent in the period.
“In February export receipts for coffee were $46.7m, down from $48.1m realised in January,” the report reads in part, further showing that fish and related products receipts registered a 25 per cent decline from $14.1m (Shs52b) to $11.2m (Shs41.4b) in the period.
Maize, which is mainly exported to countries within East Africa such as Kenya, South Sudan and DR Congo, suffered a 25 per cent decline, fetching $10m (Shs37b) in export earnings down from $15m (Shs55.5b) in January.
Decline in imports
In the same measure, the report shows that during February, Uganda’s import bill fell to $660m (Shs2.4 trillion) from $710m (Shs2.6 trillion) in January.
According to the report, government imports dropped to $20.2m (Shs74b) in February from $37.5m (Shs138b) while private sector imports fell to $526m (Shs1.9 trillion) from $549m (Shs2 trillion) in the period under review.
Oil imports also declined to $81m (Shs299b) from $87m (Shs321b) in January.
However, fuel prices have remained stable with pump prices costing between Shs4050 and Shs4090 for petrol while diesel is going for an average of Shs3,940 per litre.
Mr Peter Ochieng, an expert in the fuel business with market experience in Uganda, Kenya and Rwanda recently told Daily Monitor local fuel prices have remained stable because of the southwards movements in international price.
According to Dr Fred Muhumuza, an economist and lecturer at Makerere University School of Economics, this had been expected “because a lot of the exports go to economies that had by February started slowing down.
“Consumers had [by February] begun to be careful and conservative on what they spend on because of Covid-19,” he said, adding that gold exports, which are mainly exported to Asia, especially United Arab Emirates, had to fall because many of those countries had by February started deposing their interests, which meant there was so much in supply against demand.
“I want to believe global supply for gold has increased and demand declined as countries try to liquidate their reserves to have cash for the Covid-19 crisis,” he said.
Additionally, he said, many countries had by then started to shutdown thus it was difficult to transport goods, especially out of China, which is Uganda’s main import source, thus explaining the fall in imports.
Dr Muhumuza said the trend in the import and export markets is an indicator that government must properly plan for the country in the event that the Covid-19 pandemic continues to buffet the world.