Uganda - Country Commercial Guide
Market Overview
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Uganda is a market-based economy rich in natural resources and has one of the fastest-growing and youngest populations in the world.  Top prospects include agriculture and estimated recoverable oil reserves of over 1.4 billion barrels, and with first oil expected in 2025. 

Almost two years of partial and full COVID-19 lockdowns slowed economic growth.  In the five years prior to pandemic, Uganda’s economic growth averaged about 5.3% according to the Uganda Bureau of Statistics (UBOS).  During fiscal years 2019/2020, 2020/2021, and 2021/2022 economic growth averaged 3.7%, but has since recovered to 5.3% in 2022/2023.  Oil-related investments, full reopening of the economy, and rebounding of the service sector contributed to the improved growth.  Inflation reached a 10-year year high of 10.7% in October 2022, but reduced to 3.9% by the end of July 2023, according to UBOS. 

With a total GDP of $49 billion in FY 2022/23, the service sector, which comprised 42.6% of the economy, was a primary driver of growth (6.2%).  The agriculture sector, which employs 68% of the workforce and represents 24% of GDP, grew by 5% in FY 2022/23.  The agriculture sector continues to be primarily based on subsistence or smallholder production.  The industrial sector growth, which contributes 26.1% of GDP grew by 3.9%.  The World Bank estimates that about 41.4% of Uganda’s population lives below the international poverty line of $2.15 per day and believes the country is on track to reduce poverty to 39% by 2025 if economic growth estimates are met.  Uganda plans to spend a total of $14 billion in FY 2023/2024, an estimated 9.6% higher than the FY 2022/2023 budget.  The increase is primarily due to increased spending in interest payments, health, security, and a flagship poverty reduction program called the Parish Development Model (PDM).  

Uganda’s debt-to-GDP ratio increased to 47.3% in March 2023 (latest data available).   At least 55.46% of Uganda’s external debt is on concessional terms.  The cost of debt service to the Ugandan government continues to rise, with 20% of revenue going to repay interest and principal, most of which is for domestic debt service.  The Ugandan government increasingly turned to domestic borrowing and experienced lower than projected tax collection.   

Additional statistics on Uganda’s economy and budget are available from the sources linked below:

Uganda Statistical Abstract

National Budget Speech 2022/23

Uganda maintains an open trade and foreign exchange regime.  Nonetheless, endemic corruption, financial mismanagement, an onerous tax regime, increasing political repression, and the May 2023 enactment of the Anti-Homosexuality Act (AHA) undermine a stable and investor-friendly environment.  Political uncertainty also increases risks to foreign businesses and investors.    The ruling National Resistance Movement changed the constitution in 2017 to enable incumbent President Yoweri Museveni to contest and then win a sixth term in 2021.  Uganda’s campaign period and January 2021 elections were marred by violence, voting irregularities, and abuses primarily by the government’s security services against opposition candidates and members of civil society.  

According to UBOS, in 2022 the top three countries exporting goods and services to Uganda were China ($1.5 billion), The United Arab Emirates ($1.1 billion) and India ($897 million).  UBOS reported that in 2022 the United States exported goods and services worth $218 million.

In 2022, the top three countries importing goods and services from Uganda were South Sudan ($606 million), Kenya ($594 million), and the Democratic Republic of Congo ($430.6 million), according to UBOS.  The United States imported goods and services worth $81.6 million from Uganda during that period.   

Although Uganda was eligible for African Growth and Opportunity Act (AGOA) benefits in 2022, its exports under AGOA remain low due to high transportation costs, limited U.S. demand for Ugandan goods, and poor export capacity.  In 2022, Uganda exported goods worth $10.6 million under AGOA.  Uganda does not have a Bilateral Investment Treaty (BIT) or Free Trade Agreement (FTA) with the United States.  The United States signed Trade and Investment Framework Agreements (TIFA) with the East African Community (EAC) in 2008 and with the Common Market for Eastern and Southern Africa (COMESA) in 2001.  Uganda is a member of both the EAC and COMESA regional organizations and on November 28, 2018, Uganda formally ratified the agreement establishing the Africa Continental Free Trade Area (AfCFTA).

More information on Uganda’s trade is available here:

World Bank – World Integrated Trade Solution

U.S. Trade Representative - Uganda

The top five opportunities to export to Uganda are as follows:

  1. Growing Free Market Economy:  Uganda had averaged 5.3% GDP growth in the five years prior to the COVID-19 pandemic.  The economy slowed to an average of 3.7% during the pandemic lockdowns but is now on a recovery path.  The IMF forecasts 6% average growth over the next three fiscal years. 
  2. Substantial and Rapidly Growing Consumer Market:  Uganda’s annual population growth rate of around 3% is, according to the World Bank, among the highest in the world, with nearly four in five Ugandans under the age of 30 and half the population under the age of 15. 
  3. Dynamic Agricultural Market:  Uganda has abundant fertile land, favorable weather, and bimodal production throughout most of the country.  At least 68% of Uganda’s population is involved in the agricultural sector. 
  4. Emerging Oil Industry:  Uganda has an estimated 1.4 billion barrels of recoverable oil, with first oil exports expected in 2025.  TotalEnergies and the China Offshore Oil Corporation (CNOOC) are the main operators in Uganda.  The oil companies are estimated to invest about $10 billion in pre-production financing.  Significant infrastructure projects in the oil sector include central processing facilities, refined products pipelines, a $3.5 billion export pipeline, and the $4.5 billion oil refinery.   
  5. EAC Customs Union:  Uganda’s membership in the EAC Customs Union enables duty free exports to the more than 200 million-person EAC market.

Political Environment 

Visit State Department’s website for background on the country’s political and economic environment.