The Middle East has become the largest destination for Uganda’s exports, according to data from the Ministry of Finance.
The region, which, according to the Ministry of Finance Monthly Performance of the Economy report for the period ended 2020, took up at least 46.4 per cent of Uganda’s exports on the account of increased mineral exports, specifically to the Middle East.
The report does not mention which minerals Uganda exports to the Middle
East. However, data from Bank of Uganda indicates that Uganda’s gold exports, which have been growing in the last five years, are all sold in the Middle East with United Arab Emirates taking up the biggest share.
In October, Uganda earned $165m (Shs610b) from gold exports, much of which was sold to UAE.
This was a decline from $221m (Shs817b), which the country had earned in the period ended September.
Bank of Uganda data also indicates that exports to the Middle East during October stood at $169m (Shs625b).
However, this was a fall from $224m (Shs828b) in September.
Data indicates that only $3m is earned by Uganda outside gold exports to the Middle East.
Gold makes up an average of $200m of Uganda’s monthly exports to the Middle East, according to Bank of Uganda.
According to Ministry of Finance data, the 46.4 per cent trade was an increase from 26.8 per cent, which the Uganda had registered in the same period last year.
Middle East, according to data, is followed by the East African Community and the Rest of Africa, which take up 24.6 per cent and 10.6 per cent, respectively.
“The share of exports to the Middle East can largely be explained by the increased flow of mineral products to the region. When compared to November 2019, exports to all regions reduced save for the Middle East and the Americas,” the Ministry of Finance report reads in part.
According to the report, Uganda’s annual exports increased by 5.3 per cent, creating a buffer which has supported stability of the shilling, amid a number of disruptions due to Covid-19.
The increase in exports play an important role in the economy because it influences the level of economic growth, boosts foreign exchange earnings, employment and the balance of payments.
During November, Uganda earned $383m down from $363.86m in October. Mineral exports increased by 4.9 per cent in November. Other exports included beans and simsim, hides and skins and cotton, among others.
Uganda’s export trades least with the Rest of Europe, which takes up at least 0.7 per cent while the America’s take up just 1.1 per cent.
Asia and European Union take up 9.9 per cent and 6.7 per cent, respectively.
In November 2020, according to the Ministry of Finance, Uganda posted trade deficits with all regions save for the Middle East. The trade surplus with the Middle East increased from $1.70m in November 2019 to $123.64m in November 2020 as exports increased by $87.09m while imports decreased by $34.85m over the same period.