Uganda’s macroeconomic pressures intensified in late 2026 as its external trade deficit expanded rapidly while domestic corporate sentiment slumped to its lowest level in over three years.
According to official data released by the Bank of Uganda on Thursday, the nation recorded a trade deficit of USD 980.1 million in September 2026. This marks a significant widening from the $778.3 million deficit logged during the same period a year earlier.
The trade shortfall reflects ongoing import cost pressures; particularly for energy, industrial machinery, and consumer products that continue to outpace export growth from agricultural staples like coffee and cotton.
Adding to economic headwinds, Uganda’s Business Tendency Index (BTI) fell sharply to 53.5 in October 2026, down from an upwardly revised 56.7 in September.
The October reading represents the weakest business confidence level since February 2023, signaling growing anxiety among business executives across key economic sectors.
Sub-index evaluations showed notable deterioration in present business conditions, shrinking order volumes, reduced access to credit, and declining employment expectations.
Sectoral confidence fell sharply in construction, manufacturing, and wholesale trade. High operational costs, rising average selling prices, and tougher financial access weighed heavily on enterprise operations.
Despite the drop, the BTI remains slightly above the 50.0 mark separating economic expansion from contraction. Agriculture and financial services provided minor buffers against broader corporate pessimism.
These figures align with regional trade friction. Recent data shows Uganda’s trade deficit with East African Community partners expanded 263.5% month-on-month, driven by a surge in goods imported from Kenya and Tanzania.
Simultaneously, the Ugandan Shilling faced mild depreciation against the US dollar, adding further import cost burden onto local manufacturers and importers.
