Sri Lanka’s manufacturing recovers in Nov 2020, services still down: PMI
ECONOMYNEXT – Sri Lanka’s manufacturing activities had recovered in November 2020 after being hit by a Coronavirus outbreak in October and services continued to be weak, but with a smaller decline, a Purchasing Mangers’ Index showed.
“The significant increase in New Orders, particularly in the manufacture of textile and wearing apparel and food and beverages sectors, has mainly contributed to this considerable improvement,” the Central Bank which compiles the index said.
“Some respondents in the manufacture of food & beverages and textiles & wearing apparel sectors highlighted that, although there was a reasonable/satisfactory demand, they were unable to carry out production at the desired capacity due to lower employee availability due to health related concerns.”
Suppliers’ delivery time has lengthened with a disruption at Colombo port from Coronavirus and cargo was re-routed or lines had refused to accept shipments.
Expectations had improved.
The Services PMI was still in decline but was an improvement from the fall in October.
“Business activities in financial services and insurance sub-sectors showed an increase in November 2020,” the central bank said.
“However, business activities in wholesale and retail trade, transportation, and accommodation, food and beverage sub-sectors declined with the quarantine curfew imposed in the Western province in early November 2020 and localized isolations effected to contain the spread of the second wave of COVID-19 pandemic.
“Nevertheless, respondents in freight forwarding cited that an improvement was observed in their business activities due to the increase in apparel and personal protective equipment exports.”
There were backlogs of work with workers in locked down areas unable to report to work.
Employment continued to decline with contracts not being renewed and a halt on new recruitments. (Colombo/Dec16/2020)