“The foreign exchange cash-flow of Uganda has reached a crisis. Expenditure requiring foreign exchange is on the increase as the economy grows, while foreign exchange receipts have dwindled over the past four years from about US$400 million to a cashflow position of about US$100 million.
This study investigates the constraints which prevent exports receipts from increasing in response to the exchange rate reforms since 1981. The first conclusion drawn from this study is that exchange rate policies, unless pursued within a consistent macroeconomic stabilization framework,cannot enlist a significant response from exports producers. Second, it is clear that other constraints encompassing institutional
reforms and infrastructural reconstruction must also be addressed before a country can develop dynamic comparative advantage.”
