Home Business Uganda’s Exports Reduce by $500 Million in 12 Months

Uganda’s Exports Reduce by $500 Million in 12 Months

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Between April 2021 and April 2022, Uganda’s total exports amounted to $5.7billion.

This according to Matia Kasaija the minister of finance, planning and economic development indicates a reduction of $500million, from $6.2billion that was recorded in the same period, the previous financial year.

Kasaija said that Merchandise exports were most affected after recording a reduction of $858million.

“However, coffee receipts increased by $279.5million to $811million in the same period,” he said

However, the economy recorded an unfavorable balance of payments (BOP) after the private sector imports of goods increased significantly to $6.4billion in the year to April 2022 from $ 5 billion in the previous 12 months.

“This increase is attributed largely to investments in the oil and gas sector. For the same reason, foreign direct investment has rebounded strongly to $1.36billion in the year to April 2022 from $892million in the same period a year before,” Kasaija told Parliament on Tuesday this week.

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Uganda’s international reserves at the end of April, he said increased to $4.54billion, equivalent to about 4.6 months of imports. This was an increase from $3.57billion as of April 2021.

Fiscal Performance

As the BOPs continue to worsen, Kasaija told Parliament that the local revenue collection is still low.

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“The revenue collection target in FY2021/22 Budget was Shs.22.425trillion. Total revenue collection is now projected at Shs21.486trillion. This represents a shortfall of Shs939billion,” he said.

This implies that URA has for the second consecutive time recorded a shortfall after recording one in the last financial year.

“Despite this revenue shortfall, domestic revenue collection this financial year has improved compared to last year. This has been on account of improved tax administration and increased economic activity following the full re-opening of the economy in January 2022,” he said

LineSteppa Community

The total government expenditure excluding domestic debt refinancing, external debt amortization, and appropriation-in-aid is projected to amount to Shs35.02 trillion this ending financial year. This expenditure, he said is equivalent to 21.6% of GDP.

“This is Shs697billion higher than the expenditure planned at the time of budgeting, mainly due to the need to finance the health requirements associated with the impact of Covid-19 pandemic, and to address internal and regional security threats,” he said

The fiscal deficit in the FY2021/22 is estimated at 7.3% of GDP which is lower than the 9% fiscal deficit registered in FY2020/21.

“Our target is to reduce the fiscal deficit to 3 percent in the medium term,” he said.

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