Sri Lanka records highest export earnings in October

SRI LANKA recorded the highest export earnings in October 2005 which exceeded the US dollars 600 million mark and reached the highest ever monthly value of US dollars 607 million.

The season demand for Sri Lanka products especially in the Appeal sector was one of the main reasons for this remarkable increase while the healthy political situation also contributed for this growth, an official of the Central Bank said.

It recorded a growth of 4.3 per cent in October 2005 over and above the 36 per cent growth recorded in October 2004. Agricultural exports dominated by tea, food and beverages, rubber products and mineral exports led the overall growth in exports in October 2005.

Cumulative exports for the first ten months of the year grew by 10.4 per cent from US dollars 4,725 million in 2004 to US dollars 5,218 million in 2005.

Imports too grew at a significantly high rate of 20.9 per cent to US dollars 864 million reaching the highest ever monthly value.

Consumer goods declined by 16.5 per cent while intermediate and investment goods increased by 30.5 per cent and 38.6 per cent, respectively. Petroleum imports amounted to US dollars 180 million, recording a growth of 85.7 per cent.

Cumulative imports for the first ten months grew by 14.4 per cent to US dollars 7,352 million in 2005 from US dollars 6,429 million in 2004. Cumulative expenditure on petroleum imports increased by 45.0 per cent to US dollars 1,378 million in the first ten months of 2005.

The trade deficit in October 2005 recorded US dollars 257 million. The cumulative trade deficit in the first ten months of 2005 reached US dollars 2,134 million.

Despite the widened trade deficit, the overall balance of payment position was further strengthened as the surplus improved to US dollars 345 million by end October 2005 due to 20 per cent increase in private remittances, the benefit of the debt moratorium and the Central Bank's purchase of the net proceeds of foreign currency loans mobilised by the government from the domestic banking sector during the first ten months.

Consequently, the official international reserves increased form US dollars 2,196 million in December 2004 to US dollars 2,621 million in October 2005. Further details of the trade performance are given in the following table.