Feb 17, Colombo: Sri Lanka’s trade deficit widened in December 2019 Earnings from exports declined while expenditure on imports increased, the Central Bank reported Monday in its External Sector Performance review for the month.
Earnings from merchandise exports declined 3.2 percent in December 2019 to US$ 1 billion compared with US$ 1.0335 billion in December 2018 with the decline in agricultural exports as well as industrial exports.
Earnings from textiles and garments declined 2.1% to US$ 483.2 million due to dampened demand from the EU and the USA, despite an increase recorded in exports to non-traditional markets such as Canada, Australia and China.
Earnings from tourism were estimated at US$ 454 million in December 2019, in comparison to US$ 475 million in December 2018. In cumulative terms, earnings from tourism were estimated at US$ 3.592 billion declining 20.5 percent during the year compared to US$ 4.381 billion in 2018.
Meanwhile, workers’ remittances recorded a growth of 13.8 percent in December 2019, year-on-year, amounting to US$ 665 million. On a cumulative basis, workers’ remittances recorded a decline of 4.3 percent, amounting to US$ 6.717 billion in 2019 compared to US$ 7.015 billion in 2018.
During the month of December 2019, there was a net foreign outflow of US$ 5 million from the CSE, including primary and secondary market transactions. On a cumulative basis, the CSE recorded a net outflow of US$ 35 million in 2019.
The Sri Lankan rupee remained stable during 2019 and appreciated by 0.6 percent against the US dollar during the year. The currency appreciated by a further 0.1 percent against the US dollar during the year up to 17 February 2020.
The gross official reserves stood at US$ 7.6 billion by end December 2019, which was equivalent to 4.6 months of imports while total foreign assets consisting of gross official reserves and foreign assets of the banking sector amounted to US$ 10.4 billion at end December 2019, equivalent to 6.3 months of imports.