Uganda sold more goods to the East African Community (EAC), the rest of Africa, and the rest of Europe than it imported in the month of March, according to the ministry of Finance April report.
The rest of Europe is made up of all countries outside the European Union: Bulgaria, Norway, Switzerland, and Turkey. The rest of Africa are all countries on the continent outside the EAC.
According to the ministry of Finance, Uganda’s trade balance with the rest of Europe and EAC posted surpluses of $111.6m and $10.1m in March from deficits of $2.7m and $4.9m respectively, in February.
Also, according to the ministry of Finance, the country continued to trade at surpluses with Middle East ($187.3m) and rest of Africa ($23m), similar to February 2019. A trade surplus means exports exceed imports. It is an indicator that businesses are having a good time and are earning more from goods taken abroad.
It creates employment and growth. In many cases, a trade surplus helps to strengthen a country’s currency, as it earns more foreign currency than it spends to import goods. On the other hand, Uganda’s trade deficit – where imports were more than exports – widened with the European Union, Asia, America and others mainly due to the increase in imports from these blocs.
Uganda’s largest trade deficit remains with Asia, the report says. The trade deficit with Asia deteriorated from $179m in February 2019 to $185.2m in March 2019. On the whole, the report says, Uganda’s trade deficit reduced both on a monthly and annual basis.
At the monthly level, it narrowed to $109m in March 2019 from $204m in February 2019. On an annual basis, it narrowed to $109m in March 2019 from $183m in March 2018.
“This performance is attributed to a higher increase in export receipts compared to the increase in the import bill,” the report says.
In March, exports earnings grew by 102 per cent to $606m in March 2019 from $300.4m in February 2019. That figure could have been boosted country' gold exports worth $363 million (about Shs 1.3 trillion) in March. Finance says coffee, electricity, cotton, fish, maize, beans, hides and skins registered increased earnings mainly driven by higher export volumes in March 2019.