Sri Lanka’s July remittances down, 7-months up
ECONOMYNEXT – Sri Lanka’s worker remittances fell 4.4 percent from a year earlier to $572.8 million in July 2016, although inflows up to July were up 3.8 percent to $4,185.9 million, official data showed.
In 2016, Sri Lanka’s remittances slowed to $6,980 million from $7,018 million, according to central bank data.
Middle Eastern economies slowed in 2015 amid falling oil prices, slowing construction and other activity.
Sri Lanka’s unemployment rate has also fallen over the past few years. However, in 2015, the rupee collapsed from Rs131 to Rs145 to the US dollar, raising living costs and lowering living standards.
A falling currency discourages investments, which will boost labour productivity and give a strong incentive for firms to continue in lower wage activity as real salaries fall, giving them more nominal profits.
However, if borders are open in other countries with higher labour productivity, workers will eventually migrate outwards for higher paying jobs, despite labour shortages at home. (Colombo/Aug27/2016)