The Impact of COVID-19 Pandemic on Uganda’s Balance of Trade between April 2020 and April 2021

Abstract

The coronavirus pandemic (COVID-19) has been categorized as the worst health crisis of our times with a fatality rate of 5 percent and over 10 million people infected around the world by June 2020. Several nations worldwide put in place desperate measures, including complete national lockdowns and travel restrictions to try and contain the virus. This distorted global supply chains and adversely affected global growth. Uganda is no exception to the pandemic as the adverse effects have already started to ripple through the trade balance of the domestic economy. This paper contributes to the dearth of studies on the effect of COVID-19 pandemic on Uganda’s trade balance between April 2020 and April 2021. Purpose: The aim of this paper is to offer a critical analysis of the impact of COVID-19 on Uganda’s balance of trade. Methodological approach to the study: This paper in its analysis employed a Descriptive research design of the monthly trade data at a household, firm and national level. Findings: COVID-19 Pandemic caused a temporary short to medium term disequilibrium in Uganda’s balance. The containment measures adopted by the government of Uganda to curb the further spread of the virus specifically the first lock down announced on 26th March 2020 by his excellence the president of the republic of Uganda motivated by the first of the pandemic caused a sharp disruption of Uganda’s balance of trade. Implication: The nature of the disequilibrium in Uganda’s balance of trade of goods and services can fully recover swiftly when the crisis caused by the pandemic comes to an end. However, the COVID-19 Pandemic may have a stretched long-term impact on Uganda’s balance of trade in goods and services that heavily rely on the movement of commercial traders. Originality of the paper: The paper contributes to the existing body of knowledge in aiding to understand how COVID-19 has impacted on Uganda’s balance of trade of goods and services.