Uganda’s export earnings climb on gold boom as trade gap widens

Uganda’s merchandise export earnings rose by nearly 13 percent in May, driven by a sharp increase in gold exports, even as coffee—traditionally the country’s leading foreign exchange earner—recorded a steep decline in both volumes and earnings.

The latest Performance of the Economy Report for June 2026 released by the Ministry of Finance shows that merchandise exports increased by 12.8 percent year-on-year to $1.35 billion (about Shs4.9 trillion) in May 2026, up from $1.19 billion recorded in the same month last year.

The growth was largely underpinned by higher earnings from gold, tobacco, electricity exports and oil re-exports.

Gold remained the standout performer, with export earnings jumping 67.7 percent to $814.8 million from $485.8 million a year earlier. The ministry attributed the increase to higher export volumes and a surge in global gold prices.

The strong performance further cemented gold’s position as Uganda’s largest export, accounting for more than 60 percent of the country’s merchandise export earnings during the month.

However, the gains were partly offset by a sharp decline in coffee exports.

Coffee export earnings fell by nearly 38 percent to $151.7 million from $244 million in May 2025 as both export volumes and international prices weakened.

According to the report, Uganda exported 617,491 60-kilogramme bags of coffee in May 2026, down from 793,445 bags during the same month last year.

Average export prices also declined to $4.09 per kilogramme from $5.12 per kilogramme over the same period, reflecting weaker global prices following increased harvests by other major coffee-producing countries that left the international market well supplied.

Despite the monthly decline, Uganda’s overall export performance remained strong over the financial year.

Between July 2025 and May 2026, merchandise export earnings reached $14.47 billion, representing a 34.4 percent increase from $10.76 billion recorded during the corresponding period of the previous financial year.

The Finance Ministry attributed the strong cumulative growth largely to robust performances by gold and coffee exports over most of the financial year.

On a month-on-month basis, however, export earnings eased by 4.2 percent from $1.41 billion in April to $1.35 billion in May, mainly because of lower receipts from both gold and coffee exports.

Meanwhile, Uganda’s merchandise trade deficit widened during the month.

The trade gap increased to $115.7 million in May from $104.2 million in April after export earnings declined faster than the country’s import bill.

Compared to May last year, the trade deficit also widened by 8 percent, reflecting faster growth in imports than in exports over the period.

The figures highlight Uganda’s continued dependence on gold exports to support foreign exchange earnings, even as fluctuations in global commodity prices and demand continue to influence the country’s external trade performance.