UAE retains position as biggest buyer of Ugandan products

But China retained the top slot as seller of products to the East African nation

Kampala, Uganda | ISAAC KHISA | United Arab Emirates has retained its position as the biggest buyer of Ugandan products for the fourth  consecutive year after making orders worth US$1.84 billion from Kampala in 2020, latest data shows.

However, China retained its spot as the leading seller of manufactured products to the east African nation.

The United Arab Emirates rose to the top export market position upon hitting the US$485.13million mark in 2016 at the expense of Kenya, whose orders stood at US$ 422.99million.

Data from Bank of Uganda shows that Kenya emerged second as Uganda’s export market with orders worth US$465million, representing 11% market share of the country’s total export revenues.

United Arab Emirates’ imports from Uganda  included mainly gold which has been growing since investors set up a processing plants – African Gold Refinery, Simba Gold Refinery, Bullion Gold Refinery, Metal Testing and Smelting Company Limited, and Aurnish Gold Refinery – in the country, nearly five years ago.

UAE latest imports implies that it is the single largest buyer of Uganda’s  products compared with the entire Common Market for Eastern and South Africa (Comesa)  countries, European Union, Asia,  the rest of Africa and the America’s which consists of the United States, Mexico, Brazil and others.

The COMESA trading block ordered goods worth US$ 1.27 billion from Uganda last year compared with Europe’s US$505.43million and Asia’s US$263.36million. The rest of Africa ordered goods worth US$ 140.03million and the America US$ 57.95million.

Dr. Adam Mugume, the director of research at the central bank told The Independent that UAE has emerged as the destination of Uganda’s gold exports, thus the surge in United Arab Emirates imports from Uganda.

“Uganda’s exports of gold in 12 months to January 2021 amounted to US$1.9 billion and this went to United Arab Emirates,” he said in an email.

United Arab Emirates has also been aggressively seeking for business opportunities from Uganda over the past five years.

For instance, 2019, the UAE sent a delegation of 22 top companies to explore opportunities with their Ugandan counterparts.

The forum was organized by Sharjah Chamber of Commerce & Industry based in Dubai and Uganda Chamber of Commerce and Industry.

China’s advantage

However, China which overtook India as the leading exporter to Uganda in 2016, retained its position as the biggest exporter into the country with goods worth US$1.06bn in 2020. This was a slight increase from US$1.03billion in 2019 and US$1.01billion in 2018.

China has in the recent years involved in construction and management of various infrastructure projects worth billions of shillings.

In addition, Ugandan traders had in the past few years involved in importation of Chinese-made products for the local and regional markets.

Similarly, Kenya retained its second slot as the biggest seller of products to Uganda, with orders worth US$788.28, followed up closely with Tanzania US$747.33million and India US$ 745.22million.

This was the first time that Tanzania beat India to get the third slot as the biggest seller of products to Uganda.  The United Arab Emirates got the fourth slot with orders worth US$ 393.38million.

However, Dr. Mugume, said Uganda still has a huge potential to further increase exports to Middle East, especially fresh food products such as fruit and vegetables, dairy products, flowers.

However, he is quick to point out that this requires expansion of scale to make business case.

Export volumes

Uganda’s gold exports went up by 43% to US$1.81 billion following increased import and re-export to the foreign markets.

In addition, coffee and cocoa bean export revenues increased by 12.4% and 2.38% to US$515 million and US$99 million last year, respectively,  compared with the previous year owed to increased maturing trees in the crop’s growing areas in Bundibugyo District.

Maize exports, too, especially to Kenya and South Sudan saw an increase in earnings by 1.59% to US $66 million.

Overall, Uganda’s formal total export revenues stood at US$ 4.28bn last year compared with US$ 4.09bn in the previous year.

On the other hand, the import bill stood at US$ 6.90bn compared with US$ 6.85bn during the same period under review owed to travel restrictions occasioned by coronavirus pandemic.

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