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Uganda Opts For Kenya, S. Sudan & DR Congo Markets As Rwanda Border Row Persists

The Rwanda-Uganda border closure has adversely affected Rwanda compared to Uganda, according to figures obtained by Business Focus.

 Rwanda in February blocked Ugandan cargo trucks and buses from crossing to the neighbouring country via Katuna and Chanika border points.

This left traders from both countries stranded and counting losses.

Rwanda closed the border to reportedly pave way for upgrading the One Stop Border Post at Gatuna border. However, the Rwandan Minister of Foreign Affairs and International Cooperation, Richard Sezibera later advised Rwandans not to travel to Uganda due to ongoing arrests, harassment, and torture, a statement which depicts hostility between the two neighbouring countries.

As the border row persists, latest figures from Bank of Uganda (BoU) indicate that Uganda has opted for Kenya and South Sudan markets.

 After the border closure, Uganda exports to Rwanda plummeted to US$2.64m (Shs9.9bn) in March 2019, down from US$14.51m (Shs54.5bn) in February 2019. This represents a reduction of 81.8%. Exports further fell to US$1.16m (Shs4.36bn) in April 2019.

In January, Uganda exports to the neighbouring country stood at US$16.96m (Shs63.76bn).
While it appears that Uganda lost a lot of revenue from Rwanda in March and April, figures indicate that the country’s exports to other neighbouring countries including Kenya, South Sudan and Democratic Republic of Congo (DR Congo) have exponentiallyincreased.

For example, Uganda’s exports increased to US$19.40m (Shs72.9bn) in February, up from US$17.82m (Shs66.99bn) in January. Exports further increased to US$ 26.44m (Shs99.4bn) in March before rising to US$33.03m (124.2bn) in April.

Uganda’s exports to South Sudan (Juba) also increased to US$40.69m (Shs152.9bn) in March up from US$36.70m (Shs137.9bn) in February. However, exports fell to US$31.53m (Shs118.54bn) in April.

Figures further indicate that Uganda’s exports to D.R Congo increased to US$19.95m (Shs75.01bn) in March from US$17.38m (Shs65.3bn) in February. Exports further increased to US$20.54m (Shs77.2bn) in April.

Meanwhile, Uganda’s imports from Rwanda remain low. Imports from the neighbouring country increased to US$1.67m (Shs6.2bn) in March from US$0.75m in February.

Imports further increased to US$2.83m (Shs10.6bn) in April.

Figures further show that Uganda continues to spend a lot of money on Kenyan goods. Uganda spent US$80.15m (Shs301.3bn) on imports from Kenya in April 2019 from US$54.31m (Shs204.1bn). A month earlier, Uganda’s imports from Kenya stood at US$69.85m (262.6bn).

Rwanda and Uganda are historically good trading partners.  Uganda earns millions of dollars from exporting items to Rwanda and spends less on imports from the negibouring country.  This means that Rwanda also earns some good money in tax revenue from goods imported from Uganda.  Additionally, Uganda is Rwanda’s key trading partner going by latest statistics from the Bank of Uganda (BoU).

After Kenya and South Sudan, Rwanda is Uganda’s 3rd export destination in the Common Market for Eastern and Southern Africa (COMESA) region.

According to BoU figures, Uganda exported goods worth US$212.14m (Shs785.9bn) to Rwanda in 2018, up from US$180.8m (Shs669.8bn) in 2017.

In 2016, Uganda exported goods worth US$237.61m (Shs880.4bn) to Rwanda, up from US$193.98m (Shs718.7bn) in 2015.

In 2014, Uganda earned a whopping US$245.37m (Shs909bn) from exports to Rwanda.

This means that in the last five years, Uganda has earned Shs3.96 trillion from her exports to Rwanda.

On the other hand, BoU figures indicate that Rwanda earned US$17.94m (Shs66.4bn) from her exports to Uganda in 2018, up from US$13.10m (Shs48.5bn) in 2017.

In 2016, Uganda imported goods worth US$13.04m (Shs48.2bn) from Rwanda, up from US$11.06m (Shs40.9bn) recorded in 2015.

In 2014, Rwanda exported goods worth US$11.84m (Shs43.8bn) to Uganda.

This implies that while Uganda has earned Shs3.96 trillion from her exports to Rwanda in the last five years, the neighbouring country (Rwanda) has only managed to earn Shs247.8bn from her exports to Uganda.

To put it simply, the money Uganda earns in exports to Rwanda in a year is four times higher than what Rwanda has earned in exports to Uganda in the last five years.

The items Uganda exports to Rwanda are mainly food stuffs and household items.

Going by the above figures, it is easy to conclude that both countries strongly need each other.

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