The agricultural sector is dominant in Uganda's economy. Whilst this sector grew at an annual average of only 3.7 percent over 1990-99 compared to the far more impressive growth of the industrial and service sectors, the importance of agriculture in Uganda's economy outweighs all other sectors put together. The agricultural sector employs 82 percent of the workforce, accounts for 90 percent of export earnings, and provided 44 percent of GDP in 1999. Moreover, the farmers in Uganda's 2.5 million smallholdings and scattered large commercial farms provide the majority of their own and the rest of the country's staple food requirements. Uganda is able to rely on agriculture due to the country's excellent access to waterways, fertile soils, and, (relative to many other African nations) its regular rainfall, although it does still suffer from intermittent droughts such as in 1993-94.
Uganda's key agricultural products can be divided into cash crops, food crops, and horticultural produce. The most important cash crops are coffee, tea, cotton, tobacco, and cocoa. Uganda is second only to Kenya as Africa's largest producer of tea, exporting US$17.06 million of tea in 1996 and $39 million by 1998. Unmanufactured tobacco exports provided US$9.5 million in 1998, over 25 percent more than in 1996. The export of cocoa beans hit a recent high in 1996 with US$1.07 million in export receipts, but this had declined to $0.87 million in 1998. The primary food crops, mainly for domestic consumption, include plantains, cassava, maize, millet, and sorghum. Total cereal production was 1.76 million metric tons in 1998, which provided US$17.82 million of exports in 1998. This gain was in part negated as imports of cereals were $30.9 million in the same year. The more recent development of cultivating horticultural produce includes fresh flowers, chilies, vanilla, asparagus, and medicinal plants. At the beginning of 2001 it is unclear how well horticultural production will prosper but it does indicate the economy's potential diversity. The fact that vanilla production is the third largest in Africa, providing US$930,000 in export receipts in 1998, is a success in itself.
The economy of northeast Uganda is dominated by pastoralism (cattle farming). Although agricultural production is apparent in some areas, this is normally a mixture known as "agro-pastoralism" (integrated cattle and crop farming). It should be noted that pastoralism is in decline due to the constant cattle raids by guerrilla groups such as the Lord's Resistance Army based in southern Sudan, as well as government and aid agency intervention which encourages the fencing off of land to discourage the traditional free-roaming of cattle.