Balance of payment and economic growth in Uganda (1985-2019)

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Kampala International University,College Of Economics And Management
This paper explores the impact of balance of payments on economic growth in Uganda. The objectives of the paper was to establish the connection between the balance of payments and economic growth in Uganda , to examine the effect of export on economic growth in Uganda and to find out the effect of import on economic growth in Uganda. Secondary data was gathered from the World Bank and international monetary fund (IMF) from 1985 to 2019. The Augmented Dickey-Fuller (ADF) test were used to test for stationarity, the results reveal that all the variables were statistically significant after first differencing also the study found that ther is cointegration using ARDL method. The study concludes that balance of payment and import are statistically significance while export is not significant. The study recommended that the imports of Uganda were high though significant in growth need to be checked through establishment of import substitutions industries to reduce imports, this is because the presence of imports lead to depreciation of the Ugandan currency hence imports substitution policy will strengthen the currency of Uganda. There is need for the development of the exports for the country, exports were insignificant and hence seem to be low. The quality of the exports needs to be enhanced and the functionality of the country export system need to be developed
A research report submitted to the college of economics and management in partial fulfillment of the requirements for the award of Master of Arts of economics of Kampala International University
Balance of payment, Economic growth, Uganda