Uganda’s trade deficit widens to $210m

KAMPALA. Uganda’s merchandise trade deficit widened sharply to $210.03 million in July, up from $11.18 million in the same month last year, as the country’s trade imbalance with Asia and the East African Community deteriorated.

The figures are contained in the Ministry of Finance’s August 2026 Performance of the Economy Report, which shows that although Uganda’s trade position improved significantly compared with June, the country remained heavily reliant on imports.

The July deficit was a 64.5 per cent improvement from the $590.91 million recorded in June.

The ministry attributed the month-on-month improvement to growing trade surpluses with the Middle East and the rest of Africa, while Uganda’s trade position with the European Union shifted from a deficit to a surplus.

However, on an annual basis, the trade deficit widened by nearly $199 million, from $11.18 million in July 2025 to $210.03 million in July this year.

The deterioration was mainly driven by widening trade deficits with Asia and the EAC, according to the report.

Exports grow

Despite the wider trade gap, Uganda’s merchandise exports continued to perform strongly.

Export earnings rose by 10.1 per cent year-on-year, from $1.27 billion in July 2025 to $1.40 billion in July 2026, representing an increase of $128.28 million.

The increase was mainly driven by higher earnings from gold, maize, flowers, oil re-exports, beer, cocoa beans, cement and electricity.

Exports also increased by 8.9 per cent compared with June, when the country earned $1.29 billion from merchandise exports.

The increase was mainly supported by higher earnings from coffee, gold, maize, oil re-exports, cocoa beans and sugar.

Gold continued to dominate Uganda’s export earnings, with receipts rising by 35 per cent year-on-year from $584.18 million to $788.45 million.

The ministry attributed the increase to higher export volumes and rising international gold prices.

It said heightened geopolitical tensions had increased demand for gold as a safe-haven asset, supporting international prices.

Coffee earnings fall

Coffee, one of Uganda’s major traditional exports, recorded a contrasting performance.

Coffee export earnings fell by 18.2 per cent year-on-year, from $250.60 million in July 2025 to $204.94 million in July this year.

The decline was attributed to lower international prices and reduced export volumes.

The average export price fell from $4.20 per kilogram in July 2025 to $4.03 per kilogram in July 2026, partly due to increased production in Brazil and Vietnam.

Coffee export volumes also fell from 995,211 60-kilogram bags to 846,686 bags over the same period.

However, coffee earnings recovered on a month-on-month basis, rising by 16.8 per cent from $175.47 million in June to $204.94 million in July.

The ministry attributed the monthly increase to improvements in both export prices and the quantity of coffee shipped.

The latest trade figures come as Uganda seeks to increase export earnings and reduce its dependence on imported goods as part of its broader economic transformation agenda.

The Ministry of Finance noted that trade statistics have a one-month reporting lag, meaning the July figures are contained in the August 2026 report.