Uganda records Shs4.2 trillion from remittances

A teller gives a customer dollars in a banking hall. PHOTO/FILE

What you need to know:

Remittances totaled around $1.1billion in twelve months to July 2022.

Ugandans working abroad sent home a total of $1.1 billion (Shs4.2 trillion), in the twelve months to July 2022, according to data from Bank of Uganda (BoU).

In the Annual Supervision Report released in June this year, BoU said remittance inflows indicated that there was a recovery from a decline registered in 2020.

Dr Adam Mugume, BoU director for research said: “Remittances totaled around $1.1billion in twelve months to July 2022, almost the same amount as in the same period of 2021.”

During 2020, according to the Migration and Development brief, remittances to Uganda declined by 2.8 percent.

In an interview, Dr Mugume said that 2021 was a year of recovery when compared to 2020. But when compared with the 2019 inflows, remittances in 2021 were lower.
He attributes the recovery to the reopening of global economies as Covid-19 waned.

Sharing his views on this performance, Dr Fred Muhumuza an economist, approved the performance where Uganda kept the figure of $1.1b.

“It is good for us as we need to keep reserves stable to avoid rapid depreciation that would amplify inflationary pressures,” Muhumuza added.

Muhumuza, said the recovery in remittances is good for the economy because they come at a time when the Shilling is facing serious pressure due to an increase in demand for dollars against low supply.

“We need the dollars, but most importantly, these feed directly into households of the emigrant workers many of which are very fragile and vulnerable and support the local economy at the grassroots,” he said.

Major sources
According to BoU, the major sources remain Middle East, Europe and Americas and Uganda remains among the top 10 recipient of remittances in sub-Saharan Africa.

But it not clear how much is sent from the above source regions.
But some experts say that, North America, which includes US and Canada, has the highest concentration of Ugandan professional workers that are supplemented by a mix of casual labourers.

In the last 10 years, many of the workers that Uganda sends to the Middle East have been concentrated in casual employment.

Reports from the Ministry of Gender, estimate that at least 24,086 Ugandans leave the country annually in search of employment, especially to the Middle East.