Sri Lanka’s export growth falls to 3-year low

Sri Lanka’s export growth falls to 3-year low

23 February 2020 02:16 pm

Sri Lanka’s total exports growth in 2019 has slowed down to the lowest since 2016, recording a marginal growth of 1.4 percent Year-on-Year (YoY) to reach US$ 16.14 billion, according to the Export Development Board (EDB).

The marginal growth in export income was mainly backed by 4.5 percent YoY growth in service exports, as merchandise exports remained flat.

Merchandise exports reached US$ 11.94 billion in 2019 with a mere US$ 50 million gain compared to 2018 while service exports were estimated at US$ 4.2 billion compared to US$ 4 billion in 2018.

Only export income from apparel (US$ 5.56 billion) and tea (US$ 1. 35 billion) had exceeded the one billion dollar mark in 2019, similar to previous years.  

Earnings from exports grew marginally by 0.4 per cent (year-on-year) to US dollars 11,940 million during the year 2019 as a result of higher earnings from exports of textiles and garments (5.2%), gems, diamonds and jewellery (10.0%), coconut (6.0%), transport equipment (21.3%) and base metals and artices (6.7%), Central Bank announced.   
Import expenditure at US dollars 19,937 million during the year 2019 decreased by 10.3 per cent (year-on-year) largely due to lower imports of fuel (-6.3%), gold (- 99.4%), personal vehicles (-48.2%) and rice (-88.0%).

As a result, the deficit in the trade account contracted to US dollars 7,997 million during the year 2019 from US dollars 10,343 million in 2018.
The export unit value index declined by 4.9 per cent (year-on-year) in December 2019 due to lower prices registered in industrial and agricultural exports.
The import unit value index in December 2019 declined by 2.1 per cent (year-on-year) due to lower prices recorded in imports of intermediate goods and investment goods.

Accordingly, the terms of trade deteriorated by 2.9 per cent (year-on-year) to 89.0 index points in December 2019.