Sri Lanka’s August exports up 15.5-pct to US$1,001mn

ECONOMYNEXT – Sri Lanka’s export earnings rose 15.5% to US$1,001 million in August 2017 from a year ago, the second month it has exceeded a billion dollars, but the trade deficit widened as import costs, especially fuel, also increased.

The central bank said in a statement the increase in exports reflected the positive impact of the restoration of the GSP+ facility which gives duty free access to the European Union.

Sri Lanka’s August trade deficit widened to $856 million from $783 million a year ago, with imports up 12.6% to $1.86 billion.

Earnings from industrial exports grew by 13.1 per cent (year-on-year) to US$ 740 million in August 2017 owing to the increase in exports of textiles and garments.

“Export earnings from textiles and garments increased by 10.1 per cent (year-on-year) to US$ 433 million with improved garment exports to the EU market,” the statement said.

“Accordingly, earnings from garments exports to the EU market increased by 12.2 per cent (year-on-year) to $186 million in August 2017, contributing more than 68 per cent to the growth of garment exports.”

Earnings from agricultural exports increased 22.8 per cent (year-on-year) to $255 million in August 2017.

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“Export earnings from tea increased significantly by 20.6 per cent (year-on-year) to $131 million, mainly due to higher prices in the international market despite the reduction in exported volumes,” the central bank said.

“In line with higher tea prices in the international market, the average export price of tea increased by 22.3 per cent to $5.29 per kg in August 2017 from $4.33 per kg in August 2016.”

But the volume of tea exports declined by 1.3 per cent to 24.8 million kgs in August 2017 from 25.1 million kgs in August 2016.

Expenditure on imports increased by 12.6 per cent (year-on-year) to $1,857million, the second highest import value so far during the year, owing to the higher spending on intermediate goods, particularly fuel.

Spending on fuel imports rose 73.0 per cent (year-on-year) to $312million, largely driven by the significant increase in refined petroleum imports by 110.9 per cent to $233 million.
Import expenditure on crude oil increased by 12.2 per cent despite a reduction in volume because of higher prices.
(COLOMBO, October 18, 2017)

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