Uganda’s exports earnings fell sharply in the month of April compared to March owing to a drop in gold exports and goods crossing to Rwanda, a Ministry of Finance filing shows.
The May 2019 economy performance report shows that export earnings fell by 49.1% from US$ 604.41 million in March 2019 to US$ 307.64 million in April 2019, largely explained by a decline in gold receipts.
Earlier in March, Uganda exported a huge consignment of gold worth US$363m (1.3trillion Shillings) in March alone, according to Bank of Uganda.
This lifted Uganda’s export earnings, with the country registering trade surplus with East African Community, the Rest of Africa and Rest of Europe in that month.
In April, only $88.6m was earned from gold exports.
That gold had come from Venezuela, refined in Entebbe and re-exported.
In April, exports figures were miserable and Uganda registered a trade deficit – where money spent on imports was more than earned on exports – with all the regions.
According to Finance, several exports commodities such as coffee, tea, cotton, fish, hides & skins, sim sim, and beans also registered declines in their earnings in April.
The deficit increased to USD 333.1 million in April 2019 from USD 110 million recorded the previous month, following a higher decrease in the export earnings.
Compared to April 2018, Uganda’s exports to EAC declined by 9.8% whereas imports increased by 86.7%.
The fall in exports is explained by a decline in exports to Rwanda following the closure of the Uganda-Rwanda border. The earnings from Rwanda fell by 85% in April.
“There was an increase in imports from Kenya and Tanzania. Within the EAC bloc, Kenya remains Uganda’s main trading partner. Uganda recorded a trade deficit with Kenya and Tanzania and a trade surplus with the rest of EAC Partner States,” the report says.
When a country’s exports fall in relation to imports, it affects the value of its currency against major currencies especially the dollar. This is mainly because people need more shillings to buy dollars to import.
In April, Uganda shilling lost 0.3% of its value compared to the dollar, Finance says.