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Sri Lanka imports, exports collapse in April amid Coronavirus

ECONOMYNEXT – Sri Lanka’s exports fell 516 million US dollars to 282 million US dollars in April 2020 from a year earlier, while imports fell 473 million US dollars to 1,123 million US dollar, amid a Coronavirus crisis, official data showed.

Sri Lanka’s imports are higher than hard goods exports due to income from tourism, remittances, information technology exports as well as government foreign borrowings to finance the budget deficit, which generally exceed financial outflows.

Gross inflows to the government were hardly changed at 138 million US dollars from 135 million a year earlier.

Tourism receipts also disappeared to zero from 315 million US dollars from a year earlier. Tourism receipts are calculated based on an expenditure survey by the tourism office.

Worker remittances were down 32 percent to 375 million US dollars.

Imbalances outflows can be created by domestic credit and the rupee can collapse due to credit fired by printed money. In the absence of printed money and domestic credit, and fall in inflows such as exports must be accompanied by a fall in imports, just as imports rise when exports grow.

Sri Lanka also slapped import controls as the rupee came under pressure from money printing and the operation of a so-called ‘flexible’ exchange rate.

Non-food consumer goods fell 10.7 percent to 165.7 million US dollars with vehicles up 26 percent to 60 million US dollars, home appliances down 25 percent to 16 million US dollars, telecom devices down 36 percent to 14.3 million US dollars.

Intermediate goods fell 35 percent to 570 million US dollars, with crude oil down 74 percent to 14.2 million US dollars and refined petroleum down 64 percent to 84 million US dollars from 239 million dollars.

Textile imports fell 32 percent to 146 million US dollars.

Machinery imports collapsed 46 percent to 113 million US dollars, building material fell 35 percent to 65 million US dollars and transport equipment fell 23 percent to 71 million US dollars.

Consumer goods imports fell 1.8 percent to 302 million US dollars with dairy products falling 30 percent to 27 million US dollars, but overall foods and beverages rose 11.7 percent.

Exports fell 64 percent in April to 64.6 million US dollars with industrial exports down 74 percent to 160 million US dollars and agricultural exports down 32 percent to 120 million US dollars.

Textiles and garments fell 81 percent to 65.2 million US dollars and petroleum exports were down 66 percent to 14.5 million US dollars.

Agricultural exports were down 32 percent to 120 million US dollars with tea down 20 percent to 78 million US dollars.

The trade deficit was slightly up to 840 million US dollars from 797 million US dollars.

From January to April 2020, exports were down 25 percent to 2,932 million dollars and imports were down 12 percent to 5,625 million US dollars The trade deficit was grew to 2,693 million US dollars from 2,458 million US dollars. (Colombo/June22/2020)