Uganda’s trade deficit falls by 24.46

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Uganda’s merchandise trade deficit with the rest of the world reduced by 24.4% from $318.90m (sh1.1 trillion) in December 2024 to $241.25m (sh884.12b) in January 2025.

This is according to the finance ministry’s report on the performance of the economy for February 2025, which was released on Wednesday (March 19).

It said the deficit fell on account of an increase in exports, which more than offset the increase in imports.

A trade deficit is when a country’s imports exceed its exports, meaning the country is not making money from trade and is inevitably in debt.

The report also said in comparison with the same month last year, export earnings in Uganda grew by 50.4% from $571.16m (sh2 trillion) in January 2024 to $859.22m (sh3.1 trillion) in January 2025, largely due to increased earnings from coffee and mineral products which rose by 82.9% and 77.9%, respectively.

The spike in earnings from coffee was largely driven by higher coffee prices which rose by over 60.0% in the last year, coupled with a 14.3% increase in quantity.

“The increase in global prices followed a reduction in supply of coffee from Brazil and Vietnam (the world’s largest producers of Arabica and Robusta coffee), arising from dry weather conditions in the two countries,” the report said.

It added that the increase in exports was also attributed to higher earnings from electricity, tobacco, simsim, oil re-exports, fish and its products, among others.