Importation on economic growth rate in Uganda (1996-2012)

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Kampala International University, College of Economics and Management
This research report set out to investigate the relationship between imports and economic growth (measured by GDP) in Uganda (1995-2011), the study employed time series survey data since examined data for a short time ,its objectives were; to establish the trend of import in Uganda(1995-201 1,to establish the trend of GDP growth of Uganda(1995-201 1) ,to investigate the relationship between import and GDP growth in Uganda (1995-2011), the hypothesis of the study was there is no significant relationship between imports and GDP growth in Uganda time series analysis such Correlation analysis, regression analysis mechanisms were used. The trend of imports and GDP growth showed a general increase with percentages change of 80.65and 66.1 percent respectively. Using the correlation, regression approach, there was a strong positive correlation between imports and GDP growth(r=0.994 ),there was also significant relationship between imports and GDP growth at 0.05 level of significance,) stationary was tested and found that both imports and GDP has trend by using ACF and PACF. In conclusion therefore both import and GDP growth has a general increase, there is a positive relationship between import and growth in Uganda which agreed with Khan(1997),Grima(1982),Connofly(1998) study on imports and GDP growth this has implied that the importation of goods and services play a very important role in economic growth of Uganda. The trend in import implies that as people income increases the demand for foreign goods and services increases. The study has also supported the theory of comparative advantages since developing country like Uganda cannot foster without importation of goods and services. Finally Uganda should embark much on the exportation of good to increase on the country level of growth.
A Research Report Submitted to the College of Economics and Management in Partial Fulfillment of the Award of a Bachelor’s Degree in Economics of Kampala International University
Importation, Economic growth rate, Uganda