Export earnings up

Exports amounted to US dollars 654.6 million in June 2008; a decline of 1.9 per cent compared to June.

However, the cumulative earnings from exports during January-June, 2008 recorded an increase of 9.8 per cent and amounted to US dollars 3,888 million.

Despite the decline in earnings from some industrial exports, namely, food and beverages; garments and textiles; and machinery and equipment, earnings from agricultural exports increased by 34.6 per cent, year-on-year, given the significant increase in commodity prices in international markets and the premium prices fetched by ‘Ceylon Tea’ in key markets.

Thus, the growth in earnings from tea, coconut and minor agricultural products negated the impact of the decline in industrial export earnings to some extent.

Agricultural exports are expected to continue to perform better, in terms of volumes as well as prices, and industrial exports are expected to rebound from the one-off decline in June.

Imports in June 2008 amounted to US dollars 1,159 million; an increase of 39.4 per cent. However, non-oil imports amounting to US dollars 819 million, recorded a slower growth of 16.9 per cent.

While intermediate goods accounted for about 73 per cent of the growth in expenditure on imports in June, 2008, imports of petroleum products accounted for 87 per cent of the increase in this sector.

Expenditure on imports is expected to be lower during the rest of the year, as the petroleum prices continue to dwindle.

Fertiliser and diamonds were among the other intermediate imports that increased in June, 2008.

Expenditure on imports of consumer goods grew by 29.6 per cent, largely due to higher expenditure on food imports.

Imports of investment goods grew by 17.7 per cent, with imports of machinery and equipment and building materials expanding.