The Competitiveness of Uganda’s Non-traditional Agricultural Exports: The Case of Flowers Exports

Abstract

Flowers exports make a significant proportion of Uganda’s non-traditional agricultural export (NTAE) earnings. This study aimed to gain deeper insights into the extent to which the competitiveness of Uganda’s floricultural exports is associated with market distribution, commodity composition and competitiveness effect; and thus establish whether Uganda’s NTAEs are based on favourable commodity compositions, and are destined for relatively faster-growing markets. The data was extracted from the UN Comtrade database; and the base period was 2015–2018. For analysis, the study employed the Constant Market Share method that enables the identification of factors driving changes in export performance, and thus determine which factors are contributing positively or negatively to export growth. It also used the Revealed Comparative Advantage (RCA) index, which enabled a simple and straightforward comparison of competitiveness. The study finds that Uganda heavily relies on a single export market (Netherlands) for its earning from roses and unrooted cuttings. In the chosen base period, Uganda’s market share in the Netherlands increased by 2.4%, while that of roses’ exports declined by 9.2%. The favourable export performance of unrooted cuttings and slips were predominantly attributed to the commodity effect, which accounted for 62.9% of the export growth; while the unfavourable export performance of Uganda roses in the same base period was attributed to the competitiveness in the period (-221.6%). The results of the RCA showed that while both commodities enjoyed a comparative advantage in the base period, that of roses was steadily declining. The study was motivated by the need to increase gains from export diversification in the context of NTAEs, from the perspective of a country that predominantly relies on traditional agricultural commodities for its exports.