Sunday, May 3, 2009

South Sudan market boosts Uganda

Saturday, 02 May 2009

Since its stabilization, Southern Sudan has continued to influence business in Uganda. Sudan has become one of the major markets for Ugandan products. Trade between Uganda and her neighbours, especially Southern Sudan has increased by over 20%, and almost 80% of this trade is in agricultural products.

Besides agricultural products a big number of Sudan nationals flock to Uganda to buy different items such as building materials and clothes. This turn of events has influenced local business in various ways. For instance, in major shopping points flocked by Sudanese business people, rent has risen.

"We receive not less than two customers a day from Sudan who come to buy building materials. Our landlords have raised rent as a result," Christine of Deo and Sons Hardware at Arua Park in Kampala noted.

The impact of Southern Sudan trade on the outflow of agricultural products from Uganda has become an opportunity to the rural folk to increase their household incomes. Interestingly, some of the most highly priced products exported to Southern Sudan are chicken and eggs.

Sudan has also consistently proved to be the leading consumer of Ugandan coffee in the whole world, beating countries like USA, Japan, China and India. In February 2009, a total of 59,090 bags (18.4%) were shipped to Sudan up from 32,550 bags (10.1%) in January 2009; 30,000 bags (10.3%) in December 2008; 28,700 bags (10.8%), in November; 22, 050 bags (12.3%) in October; and September 22,300 bags (12.6%).

For all these months Sudan was the second largest consumer of Ugandan coffee after the European Union countries.

Lately there has also been a shortage of beef for both the local and international market partly because there has been an increase in cattle trade between Uganda and Southern Sudan. This has as well led to the increase in the prices of beef on the local market.

According to the official indicators of development report in the second half of 2008, increasing food prices which contributed to the high inflation rates were partly due to high demand of food in Southern Sudan. Food crops inflation rose to 33.7% in August from 20.5% in July 2008 partly on account of continued robust regional demand for food items particularly from Southern Sudan.

However between August and December 2008, the food crops inflation slowed down to 24.7% following increased food supplies. "Despite the demand of Ugandan products in Southern Sudan, Ugandans are yet to benefit fully since the treatment they receive in Southern Sudan still leaves a lot to be desired," a player in business noted.