Uganda’s exports jump 83 percent, driving down trade deficit

Uganda’s merchandise trade deficit narrowed sharply in December 2025, driven by a surge in export earnings that outpaced the growth in imports, according to the January 2026 Performance of the Economy Report.

The country recorded a trade deficit of USD 206.42 million in December 2025, down 24.01 percent from USD 271.65 million in December 2024. On a month-on-month basis, the deficit also contracted 6.61 percent from USD 221.04 million in November 2025. Officials attributed the improvement to strong growth in key export sectors, particularly minerals and coffee, while import growth remained relatively moderate.

Merchandise exports surged 83.49 percent year-on-year to USD 1,395.07 million, up from USD 760.31 million in December 2024. Key drivers included higher earnings from mineral products, coffee, base metals and their products, cocoa beans, crude oil (excluding petroleum products), beans, and cement.

Coffee exports were a notable contributor, with volumes rising 21.67 percent to 502,582 60-Kilogram Bags from 413,079 bags in the same month last year. The increase reflected higher domestic production and an improvement in average unit prices, which rose 7.09 percent, despite a global price slowdown caused by improved supply conditions. Leading markets for Uganda’s coffee included Italy, Belgium, Germany, India, and Sudan.

Monthly exports also grew, rising 16.08 percent from USD 1,201.80 million in November 2025 to USD 1,395.07 million in December 2025. The growth was primarily fueled by higher earnings from mineral products, cocoa beans, oil re-exports, and beans.

The report highlights a significant shift in Uganda’s export destinations. The Middle East remained the top destination for the twelfth consecutive month, with exports more than doubling from USD 271.94 million in December 2024 to USD 676.59 million in December 2025. Similarly, exports to Asia rose sharply from USD 93.98 million to USD 219.25 million over the same period. Combined, these two regions accounted for 64.2 percent of total merchandise exports in December 2025, up from 48.1 percent a year earlier.

Economists say the strong export performance signals both increased production capacity and expanding market diversification for Uganda’s goods. Minerals and coffee remain the backbone of export receipts, while cocoa beans, oil re-exports, and beans are gradually contributing to revenue growth.

The improvement in trade balance also offers potential relief for the country’s foreign exchange reserves and inflationary pressures, given that Uganda relies heavily on imports to meet domestic demand for goods.

Analysts note that maintaining this export momentum will require sustained investment in production, value addition, and logistics infrastructure, particularly for minerals and agricultural commodities. Expanding market access in the Middle East and Asia has also proved critical, as these regions now account for nearly two-thirds of total merchandise exports.

With December’s strong performance, Uganda ended 2025 on a positive note, signaling a strengthened external sector that could support economic growth, improve currency stability, and enhance the country’s resilience to external shocks in 2026.