Comparing the Performance of Uganda’s Intra-East African Community Trade and Other Trading Blocs: A Gravity Model Analysis

Comparing the Performance of Uganda's Intra-East African Community Trade and Other Trading Blocs: A Gravity Model Analysis

The paper examines the factors that determine Uganda's trade flows and compares the impact and performance of various trade blocs on Uganda's trade patterns and flows. The empirical question is whether Uganda's trade is getting more integrated in the East African Community (EAC) region or is still dominated by other trading blocs, namely the European Union (EU), Common Market for Eastern and Southern Africa (COMESA) and Asia. The results suggest a strong relationship between belonging to a trade bloc and trade flows. Uganda's import and export trade flows have conspicuously adjusted to the gravitational forces of the EAC during the progress of integration. While exports are being more integrated in the EAC and COMESA regions, imports are more integrated in the Asian and EU trading blocs. The trade indicators demonstrate that Uganda exports largely primary products and imports manufactured products. It is imperative for Uganda to target implementation of regional trade agreements to expand the country's export markets. The EAC region should attract investment in production of high technology products to increase intra-EAC imports from Asia and the EU.

Date:	2013-04-10
Authors:	Isaac Shinyekwa & Lawrence Othieno

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• Published Apr 10, 2013