KAMPALA – The overall economic activity as well as business conditions in Uganda continued to strengthen during the month of May, according to the latest Performance of the Economy Report released by the Finance Ministry.
The ministry in the June 2023 report says the Composite Index of Economic Activity [CIEA], Purchasing Managers’ Index [PMI], and Business Tendency Index [BTI] edged upwards signaling improvement in economic activity.
During the month, the CIEA grew by 1.1 percent to 156.36 in May 2023 from 154.62 in April 2023 compared to a contraction of 0.7 percent recorded in April 2023.
According to the report, there was strong growth in the agriculture sector as there was increased production of Irish potatoes, matooke, maize grain, sweet potatoes, tea, and cassava as a result of favorable weather conditions.
The PMI also indicated an improvement in economic activity. The PMI was recorded at 56.4 in June 2023 down from 57.4 in May 2023. “Despite this decline, the index still reflects an improvement in economic activity as it was above 50.0-mark threshold.”
Surveyed firms were optimistic regarding outlook for the coming year due to further improvements in output and new business/ new orders and increase in employment.
Business Perceptions
On the other hand, business perceptions continued to be optimistic as signaled by an increase in the BIT recorded at 61.98 in June 2023 from 58.39 in May 2023. “This mark was the highest compared to the previous months.”
The report adds: “Assessment of Key Indicators by Sector showed that optimism was reflected in all sectors except for wholesale trade. In addition, all key indicators measured by the index signaled optimism except for average selling price.”
Exports
According to the report, the value of merchandise exported increased to 585.81 million in May 2023 from USD 351.23 million in May 2022. “Similarly, the value of merchandise exported in May 2023 increased by 8.7 percent to USD 585.81 million up from USD 538.87 million registered the previous month, mainly due to higher receipts for coffee.”
Export volumes of coffee increased by 21.3 percent to 453,169 [60kg bags]in May 2023 from 373,610 [60kg bags] the previous month. “This increment in volume followed a reduction in supply of coffee from major countries such as Brazil and Vietnam on the international market.”
The report says Uganda’s other export items whose receipts increased during the month include sugar, beans, cement, tobacco, cotton, and tea among others.
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