Uganda: Economy#
Uganda has substantial natural resources, including fertile soils, regular rainfall, small deposits of copper, gold, and other minerals, and recently discovered oil. Agriculture is the most important sector of the economy, employing one third of the work force. Coffee accounts for the bulk of export revenues. Uganda’s economy remains predominantly agricultural with a small industrial sector that is dependent on imported inputs like oil and equipment. Overall productivity is hampered by a number of supply-side constraints, including underinvestment in an agricultural sector that continues to rely on rudimentary technology. Industrial growth is impeded by high-costs due to poor infrastructure, low levels of private investment, and the depreciation of the Ugandan shilling.Since 1986, the government - with the support of foreign countries and international agencies - has acted to rehabilitate and stabilize the economy by undertaking currency reform, raising producer prices on export crops, increasing prices of petroleum products, and improving civil service wages. The policy changes are especially aimed at dampening inflation while encouraging foreign investment to boost production and export earnings. Since 1990 economic reforms ushered in an era of solid economic growth based on continued investment in infrastructure, improved incentives for production and exports, lower inflation, better domestic security, and the return of exiled Indian-Ugandan entrepreneurs.
The global economic downturn in 2008 hurt Uganda's exports; however, Uganda's GDP growth has largely recovered due to past reforms and a rapidly growing urban consumer population. Oil revenues and taxes are expected to become a larger source of government funding as production starts in the next five to 10 years. However, lower oil prices since 2014 and protracted negotiations and legal disputes between the Ugandan government and oil companies may prove a stumbling block to further exploration and development.
Uganda faces many challenges. Instability in South Sudan has led to a sharp increase in Sudanese refugees and is disrupting Uganda's main export market. High energy costs, inadequate transportation and energy infrastructure, insufficient budgetary discipline, and corruption inhibit economic development and investor confidence. During 2015 the Uganda shilling depreciated 22% against the dollar, and inflation rose from 3% to 9%, which led to the Bank of Uganda hiking interest rates from 11% to 17%. As a result, inflation remained below double digits; however, trade and capital-intensive industries were negatively impacted.
The budget for FY 2015/16 is dominated by energy and road infrastructure spending, while relying on donor support for long-term economic drivers of growth, including agriculture, health, and education. The largest infrastructure projects are externally financed through low-interest concessional loans. As a result, debt servicing for these loans is expected to rise in 2016/2017 by 22% and consume 15% the domestic budget.
Economic Facts#
| GDP (purchasing power parity) | $84.93 billion (2016 est.) $80.92 billion (2015 est.) $77.21 billion (2014 est.) note: data are in 2016 dollars |
|---|---|
| GDP (official exchange rate) | $25.61 billion (2015 est.) |
| GDP - real growth rate | 4.9% (2016 est.) 4.8% (2015 est.) 4.9% (2014 est.) |
| GDP - per capita (PPP) | $2,100 (2016 est.) $2,000 (2015 est.) $2,000 (2014 est.) note: data are in 2016 dollars |
| Gross national saving | 16.9% of GDP (2016 est.) 15.3% of GDP (2015 est.) 17.7% of GDP (2014 est.) |
| GDP - composition, by end use | household consumption: 73.7% government consumption: 9.7% investment in fixed capital: 24.6% investment in inventories: 0.2% exports of goods and services: 20.5% imports of goods and services: -28.7% (2016 est.) |
| GDP - composition, by sector of origin | agriculture: 24.5% industry: 21% services: 54.4% (2016 est.) |
| Agriculture - products | coffee, tea, cotton, tobacco, cassava (manioc, tapioca), potatoes, corn, millet, pulses, cut flowers; beef, goat meat, milk, poultry, and fish |
| Industries | sugar, brewing, tobacco, cotton textiles; cement, steel production |
| Industrial production growth rate | 5% (2016 est.) |
| Labor force | 19.03 million (2016 est.) |
| Labor force - by occupation | agriculture: 40% industry: 10% services: 50% (2015 est.) |
| Unemployment rate | NA% 9.4% (2013 est.) |
| Population below poverty line | 19.7% (2013 est.) |
| Household income or consumption by percentage share | lowest 10%: 2.4% highest 10%: 36.1% (2009 est.) |
| Distribution of family income - Gini index | 39.5 (2013) 45.7 (2002) |
| Budget | revenues: $3.748 billion expenditures: $5.41 billion (2016 est.) |
| Taxes and other revenues | 14.6% of GDP (2016 est.) |
| Budget surplus (+) or deficit (-) | -6.5% of GDP (2016 est.) |
| Public debt | 35.4% of GDP (2016 est.) 29.6% of GDP (2015 est.) |
| Fiscal year | 1 July - 30 June |
| Inflation rate (consumer prices) | 5.6% (2016 est.) 4% (2015 est.) |
| Central bank discount rate | 14% (December 2014) 17% (30 March 2016) |
| Commercial bank prime lending rate | 22.6% (31 December 2016 est.) 22.6% (31 December 2015 est.) |
| Stock of narrow money | $2.046 billion (31 December 2016 est.) $2.043 billion (31 December 2015 est.) |
| Stock of broad money | $4.262 billion (31 December 2014 est.) $3.705 billion (31 December 2013 est.) |
| Stock of domestic credit | $4.287 billion (31 December 2016 est.) $3.973 billion (31 December 2015 est.) |
| Market value of publicly traded shares | $7.294 billion (31 December 2012 est.) $7.727 billion (31 December 2011 est.) $1.788 billion (31 December 2011 est.) |
| Current account balance | -$2.23 billion (2016 est.) -$2.29 billion (2015 est.) |
| Exports | $2.723 billion (2016 est.) $2.667 billion (2015 est.) |
| Exports - commodities | coffee, fish and fish products, tea, cotton, flowers, horticultural products; gold |
| Exports - partners | Rwanda 10.7%, UAE 9.9%, Democratic Republic of the Congo 9.8%, Kenya 9.7%, Italy 5.8%, Netherlands 4.8%, Germany 4.7%, China 4.1% (2015) |
| Imports | $4.677 billion (2016 est.) $4.911 billion (2015 est.) |
| Imports - commodities | capital equipment, vehicles, petroleum, medical supplies; cereals |
| Imports - partners | Kenya 16.4%, UAE 15.5%, India 13.4%, China 13.1% (2015) |
| Reserves of foreign exchange and gold | $2.851 billion (31 December 2016 est.) $2.909 billion (31 December 2015 est.) note: excludes gold |
| Debt - external | $6.241 billion (31 December 2016 est.) $5.649 billion (31 December 2015 est.) |
| Stock of direct foreign investment - at home | $NA |
| Stock of direct foreign investment - abroad | $NA |
| Exchange rates | Ugandan shillings (UGX) per US dollar - 3,427 (2016 est.) 3,234.1 (2015 est.) 3,234.1 (2014 est.) 2,599.8 (2013 est.) 2,505.6 (2012 est.) |