Key Takeaways
- Uganda's export earnings increased by 10.2% year-on-year in July.
- Higher shipments of gold, cocoa, and flowers contributed to the rise.
- The increase could help stabilize the weakening shilling.
Uganda's export earnings rose by 10.2% year-on-year in July, according to the finance ministry. The growth was driven by increased shipments of commodities such as gold, cocoa, and flowers.
The value of gold shipments surged by 35% to $788.45 million in July, marking a significant contribution to the overall export earnings. The ministry attributed this to higher export volumes and increased international gold prices, driven by heightened global geopolitical tensions.
In addition to gold, cocoa remains a key source of foreign exchange for Uganda. The ministry noted that the export earnings from cocoa and other commodities like flowers and maize also contributed to the overall increase.
The ministry's report stated that export earnings rose to $1.40 billion in July from $1.27 billion in the same period last year. This increase could help cushion the local currency, the shilling, which has been weakening against the dollar in recent days.
Uganda is a regional gold-processing hub, and the surge in gold shipments reflects the country's role in the global gold market. The ministry highlighted that the increase in gold earnings was due to both higher volumes and increased international prices.
The export earnings from gold were particularly significant, with a 35% increase in value. This growth was attributed to increased demand for gold as a safe haven amid global geopolitical tensions. The ministry noted that gold and coffee are the main sources of foreign exchange for Uganda.
The ministry's report also mentioned that the export earnings from other commodities, such as flowers and maize, also contributed to the overall increase. These exports, while smaller in value, are still important contributors to the country's foreign exchange reserves.
The ministry's report suggested that the increase in export earnings could help stabilize the shilling, which has been under pressure due to various economic factors. The ministry is likely to continue monitoring the situation closely to ensure that the positive trend in export earnings continues.
