Industrial exports grow

By 3.3% to US $ 733 m in January:

In January 2012, earnings from exports stood at US $ 918 million, indicating a marginal decline of 0.6 percent, compared to that of January 2011, which was largely attributable to the decline in earnings from agricultural exports and higher base in January 2011.

Meanwhile, the expenditure on imports increased by 20.1 percent to US $ 1,883 million in January 2012, showing a deceleration for the second consecutive month.

Industrial exports, which contribute about 80 percent to the total exports, grew by 3.3 percent to US $ 733 million in January 2012.

Within industrial exports, textiles and garments remained the major contributor recording a growth of 1.6 percent to US $ 367 million. Exports of petroleum products grew by 106.2 percent to US $ 45 million mainly due to increased bunkering exports. Earnings from rubber based products increased by 20.7 percent due to the increased demand from major export destinations, particularly from USA.

Export earnings from gems, diamonds and jewelery increased by 44.6 percent and earning from machinery and equipment increased by 28 percent in January 2012 compared with the corresponding month of 2011. Among industrial exports, earnings from transport equipment, food, beverages and tobacco, printing and leather products, travel goods and footwear, which contributed to about 11 percent of total exports, declined by 32.1 percent in January 2012.

Earnings from agricultural exports declined in January 2012, as a result of lower performance recorded in traditional agricultural exports of tea and rubber. Earnings from tea exports declined by 19.1 percent, year-on-year, to US $ 104 million mainly due to geopolitical uncertainties in major tea importing destinations. Rubber exports declined as the demand from local rubber manufacturing industries remained elevated. Apart from traditional agricultural exports, exports of spices, vegetables and minor agricultural exports also recorded declines in January 2012.

However, coconut exports increased in January 2012 mainly due to higher production resulting from favourable weather conditions and the fertilizer subsidy scheme of the government. Agricultural exports of unmanufactured tobacco and seafood also performed well in January 2012. Earnings from seafood exports were propelled by increased exports of frozen fish and crustaceans.

The growth in imports decelerated to 20.1 percent in January 2012 compared to year-on-year increases of 78.5 percent and 31.3 percent recorded in November and December of 2011. The deceleration in expenditure on imports was mainly driven by mineral products and diamonds and precious stones in the intermediate goods category and vehicle imports in the consumer goods category. Nevertheless, reflecting the continuous expansion in economic activities, investment goods imports grew by 72.4 percent in January 2012. All the three major categories of investment goods; transport equipment, building materials and machinery and equipment recorded healthy growth of 100.3 percent, 71.1 percent and 60.2 percent, respectively.

Meanwhile, expenditure on intermediate goods increased by 8.6 percent to US $ 1,065 million mainly due to higher petroleum imports. Expenditure on petroleum imports increased by 18.9 percent to US $ 484 million in January 2012 compared to that of January 2011,

reflecting a substantial increase in prices. The average price of crude oil imports increased by 21.3 percent to US $ 115.62 per barrel in January 2012 from US $95.33 per barrel in January 2011.

Higher petroleum prices in the international market were due to rising geopolitical tensions in number of oil producing countries and higher demand emanating from extremely cold weather in Europe. Expenditure on fertilizer imports also increased owing to both higher prices and increased volume of imports.