Economy

Uganda has substantial natural resources, including fertile soils, regular rainfall and sizable mineral deposits of copper and cobalt. Agriculture is the most important sector of the economy, employing over 80% of the work force, with coffee accounting for the bulk of export revenues. Since 1986, the government (with the support of foreign countries and international agencies) has acted to rehabilitate an economy decimated during the regime of Idi Amin and subsequent civil war.

During 1990-2001, the economy turned in a solid performance based on continued investment in the rehabilitation of infrastructure, improved incentives for production and exports, reduced inflation, gradually improved domestic security, and the return of exiled Indian-Ugandan entrepreneurs. These policies produced positive results. Inflation, which ran at 240% in 1987 and 42% in June 1992, was 5.4% for fiscal year 1995-96 and 7.3% in 2003.

However, ongoing Ugandan involvement in the war in the Democratic Republic of the Congo, corruption within the government, and slippage in the government's determination to press reforms raise doubts about the continuation of strong growth. In 2000, Uganda qualified for the enhanced Heavily Indebted Poor Countries (HIPC) debt relief initiative worth $1.3 billion and Paris Club debt relief worth $145 million. These amounts combined with the original HIPC debt relief added up to about $2 billion. Growth for 2001-02 was solid despite continued decline in the price of coffee, Uganda's principal export. According to IMF statistics, in 2004 Uganda's GDP per-capita reached 300 dollars, a much higher level than in the Eighties but still at half of Sub-Saharan African average income of 600 dollars per year. Total GDP crossed the 8 billion dollar mark in the same year.

Agriculture

Most industry is related to agriculture, with agricultural products supply nearly all of Uganda's foreign exchange earnings, with coffee alone (of which Uganda is Africa's leading producer) accounting for about 27% of the country's exports in 2002. Exports of apparel, hides, skins, vanilla, vegetables, fruits, fish and cut flowers are growing, and cotton, tea and tobacco continue to be mainstays.

Industrial Sector

The industrial sector is being rehabilitated to resume production of building and construction materials, such as cement, reinforcing rods, corrugated roofing sheets and paint. Domestically produced consumer goods include plastics, soap, cork, beer and soft drinks.