The National Planning Authority (NPA) has advised the Government to temporarily ban the exportation of food products to address the increasing commodity prices in the country.

Rogers Matte, the director for research and development performance at NPA, made the remarks while making a presentation on the state of the economy before Parliament’s committee on national economy.

The committee, chaired by Bukedea County MP John Ikojo, is currently assessing the state of the economy and public debt.

“The rising prices of various commodities are a concern, especially food items. With 40.5% of household expenditure on food, there is need, in the short term, to ban the export of food items, as well as increase production,” Matte submitted.

NPA officials, in their presentation, had highlighted that the country is facing headline inflation that increased from 2% in May last year to 4.9% in April this year, mainly due to price increments in energy, fuel, utilities, food and related item crops.

Quoting the Uganda Bureau of Statistics and NPA computations of 2022, Matte told legislators that between March and April, there has been an increase in prices of matooke, maize flour, beans, carrots and cucumbers.

Prices of essential commodities used in homes, such as sugar, kerosene, soap and cooking oil, have also gone up, whereas there has been a 28% increase in prices of cement, 57.4% and 35.1% rise in prices of diesel and petrol, respectively.

NPA explained that the rise in the price of soap from sh3,800 to sh7,700 is because of the shortage of raw materials like palm oil that are imported from Indonesia and Kenya; increased labour costs in Indonesia because of the COVID-19 challenges and shortage of containers due to high demand from different countries.

Concerning the rise in prices of sugar from sh3,000 to sh3,700 within one year, Matte cited the explanation of the Sugar Manufacturers’ Association, which decried the rise in fuel prices since the cane is transported on trucks from the garden to the factories.

Meanwhile, the rise in the prices of petrol and diesel, NPA said, was a result of global and domestic factors, whereby the international prices of crude oil changed and the sh100 per litre Excise Duty levy in the current financial year’s budget in Uganda.

Other solutions suggested by NPA to address the current economic distresses in the country are strengthening the fuel reserve system, fast-tracking the oil and gas development, frugal Government spending to curtail wastage in public service delivery and promoting of import substitution manufacturing.

Bank of Uganda (BOU) officials, while appearing before the same committee, revealed that the rising commodity prices have caused inflation to surge to a higher level in Uganda and other economies around the world, but warned it will take a little longer to deal with.

Jimmy Apaa, the director of economic research at BOU, said the Russia- Ukraine war is one of the factors that have exacerbated “commodity demand-supply imbalances” that have led to price increases.

“The risks to the inflation outlook are largely tilted to the upside, including worsening global supply/demand imbalances aggravated by the war and further increases in commodity prices, which could lead to persistently high inflation and rising inflation expectations,” Apaa said.

He revealed that in Uganda, the annual headline and core inflation rose to 4.9% and 4.3% in April 2022 from 1.9% and 2.1% in October 2021, respectively, whereas non-core inflation rose to 7.9% from 0.8% over the same period.