Uganda Economy

Uganda Economy


Although Uganda has enjoyed economic and political stability and continuous economic growth of 5–10% annually for 20 years, the country is one of the poorest countries in the world. The majority of the population lives in subsistence farming or is employed in the informal sector. With a foreign debt of (2017) 40% of the gross domestic product s (BIP), debt service could be reduced significantly through participation in international debt relief initiatives. Furthermore, the privatization of state-owned companies and savings in government spending created favorable conditions for the granting of international development aid. The inflation rate could be reduced to (2017) 5.2%. The proportion of people living below the official poverty line has fallen to a quarter of the population in the last two decades. In 2015 the government passed a second national development plan, which provides for the extensive expansion of the infrastructure and the energy sector on the basis of the expected oil revenues.

Foreign trade: Uganda has had a high foreign trade deficit for many years (import value 2017: US $ 5.6 billion; export value: US $ 2.9 billion). The share of coffee, which once dominated exports, has fallen to around 15%. Other export goods are products of light industry, agricultural products and fish. The main import goods are machinery and equipment, automobiles, oil products, chemical products (medicines) and food. The most important trading partners are Kenya and the United Arab Emirates, as well as China, India and South Sudan.


The agricultural sector is the dominant branch of the economy; it contributes a large part to the creation of the gross domestic product (GDP) (2017: 24.9%) and employs over two thirds of the workforce. However, the economic importance of the agricultural sector declined in favor of the service and industrial sectors. Its dependence on the long-standing main export product, coffee, has been reduced through diversification. The predominantly very small farms produce mainly for their own consumption. Due to favorable natural conditions (almost half of the land area can be used for arable farming) Uganda has good prerequisites for self-sufficiency with food. coffee is the most important crop for export. Although its share of total exports fell sharply due to fluctuating world market prices and the diversification of the agricultural sector, Uganda is still – by volume – the second largest African coffee producer and one of the top ten producing countries worldwide. The main cultivation areas are the southern region and the high forest belts on the Elgon and Ruwenzori mountains. Other important agricultural export products are tea, tobacco, cotton, sugar cane and cocoa. Plantains, cassava, potatoes, corn, millet and potatoes are grown for self-sufficiency. The livestock industry (in addition to cattle, especially goats and sheep) is concentrated in northern and eastern Uganda; a third of the (2016) 14.4 million cattle are dairy cattle.

Forestry: Since the energy supply of the population depends to more than 90% on wood, the decimation of the forest stands is serious, especially through the production of firewood and charcoal, but also through slash and burn and overgrazing. Between 1990 and 2016 alone, the forested area fell from 24.1% to 9.7% of the country’s area. The annual logging volume is (2016) 46.8 million m 3. Only a small part of wood production is used commercially (e.g. as building material).

Fisheries: Traditionally, fisheries have played a major role in supplying the population as well as exporting. The catch is (2016) 467 500 t; about 10% of this comes from aquaculture. The main fishing areas are the Victoria ( Victoria perch ), the Kyoga- and Lake Albert.


Tourism is an important source of foreign currency, the number of tourists has risen continuously in recent years. In 2016, 1.32 million foreign visitors came to Uganda, around three quarters of them from African countries. Income was US $ 1.2 billion. The largest tourist attractions are the numerous national parks: among others. the Bwindi Primeval Forest National Park (UNESCO World Natural Heritage Bwindi Primeval Forest ), the Mgahinga Gorilla National Park on the northern slopes of the extinct Virunga Volcanoes, the Ruwenzori Mountains National Park (UNESCO World Natural Heritage Ruwenzori Mountains ), the UNESCO World Biosphere Reserve Queen Elizabeth National park, the Murchison National Park on the northern tip of Lake Albert and cultural monuments such as the Kasubi tombs of the kings of Buganda near Kampala (UNESCO World Heritage Site tombs of the Buganda kings ).

Natural resources

Uganda has extensive natural resources, including of gold, iron ore, copper, coltan, cobalt, tungsten and tin, of which only a small part has been researched and developed. From 2006 minable oil and natural gas deposits were discovered in the vicinity of the Albertsee; funding is to commence in 2020. With the exception of small amounts of copper and chrome ore and limestone, hardly any mineral raw materials are mined.


The share of the industrial sector in GDP is growing continuously and amounts to 20.0% (2017). The most important companies mainly process domestic agricultural products such as coffee, cotton and sugar cane. The manufacture of fertilizers, metal products and cement as well as textiles and clothing are also important. The largest industrial locations are the capital Kampala, Jinja, Mbarara, Kasese and Tororo. Most of the electrical energy is generated with hydropower (Bujagali, Nalubaale and Kiira dams); To improve the power supply, further power plants are under construction (including Ayago, Karuma).


Due to its inland location, Uganda’s transport policy is geared towards the transit routes to the Indian Ocean. By far the most important transport route is the road network (mostly unpaved). The railroad ( Uganda Railway ), which used to run to the border of the Democratic Republic of the Congo, is currently only operated on the Kampala route via Jinja and Tororo across Kenya to the Mombasa seaport in Kenya. On Lake Victoria, there are rail ferry connections from Port Bell near Kampala and from Jinja to Kisumu in Kenya and Mwanza in Tanzania. Inland navigation on the Victoria, Kyoga and Albert lakes as well as the Nile is also of great importance. Overseas trade is handled through Mombasa (Kenya) and Dar es Salaam (Tanzania). There is an international airport in Entebbe, 40 km from Kampala.

Uganda Economy

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