Uganda’s economy has shown remarkable expansion, reaching Shs39.535 trillion in the second quarter of the 2024/25 financial year. This marks a 5.3% real Gross Domestic Product (GDP) increase from the previous year’s Shs37.604 trillion.
The growth, driven by the agriculture and manufacturing sectors, highlights increasing investor confidence and job creation potential.
Agricultural Sector Boost
The Uganda Bureau of Statistics (UBOS) reported a 7.2% growth in agriculture, with value-added contributions reaching Shs8.948 trillion.
This growth was largely attributed to an 8% increase in food crop production, including bananas, maize, and beans. Cash crops also saw a boost, with vanilla and palm contributing to a 6.7% growth.
Manufacturing and Industry Surge
The industrial sector recorded an 8.4% increase, bringing its total value-added contribution to Shs10.555 trillion. Manufacturing played a key role, expanding by 7.6%, largely due to increased pharmaceutical production.
Additionally, the construction sector grew by 5.9%, further strengthening industrial performance.
Services Sector and Trade Performance
While the services sector recorded a modest 2% growth, some areas showed resilience. Trade and repair services expanded by 8.6%, while transport and storage activities grew by 4.3%.
Taxes on products and subsidies also increased by 9%, driven by higher import duties.
Consumer Spending Decline
Despite overall economic expansion, household spending saw a downturn.
“In real terms, year-on-year consumption expenditure recorded a decline of 2.7%, primarily due to a 4.9% drop in household final consumption expenditure,” said Dr. Vincent F. Ssennono, UBOS deputy executive director.
Despite this dip, gross capital formation remained stable, with a slight increase in dwelling investments. Uganda’s continued growth in key sectors like agriculture and manufacturing paints an optimistic economic outlook, even as consumer spending lags.
