Sri Lanka’s earnings from exports in the month of April 2015, which declined by 7.4% to US$ 708 million in April 2015 was the lowest monthly earning after April 2013, the Central Bank said on Thursday. According to statistics, earnings from exports in the first four months of this year, has declined by a marginal 0.3% to US$ 3.57 billion compared to US$ 3.58 billion recorded during the previous year. Thus, the deficit in the trade account in April 2015 widened by 15% to US$ 783 million while on a cumulative basis, trade deficit during the first four months of 2015 increased by 3.9% to US$ 2.7 billion.

“The reductions recorded in exports earnings from tea, petroleum products, sea foods, rubber products and textiles and garments, respectively contributed for the drop in exports during the month,” the Central Bank said in its Monthly External Performance Review released on Thursday.

The review noted that Tea exports, which were severely affected by the lower demand from Russia and Middle East, declined for the seventh consecutive month in April 2015, recording a drop of 12.7% over the corresponding month of 2014. Tea exports to Russia and Middle East declined by 39.0 percent and 5.5 percent, respectively, during the first four months of 2015 compared to the corresponding period in 2014.

“Earnings from petroleum product exports declined by 42.7 percent, year-on-year, in April 2015 as a result of around 40 percent price reduction and 6.6 percent volume drop recorded in bunker fuel exports. Sea Food exports which dropped continuously from October 2014, declined further in April 2015, recording 41.2 percent reduction compared to the corresponding month in 2014 mainly due to 68.3 percent decline in sea food exports to the EU market, the main sea food market of Sri Lanka.”

The sea food exports from Sri Lanka to the EU market were banned with effect from 13th January 2015.

“In line with the significantly low raw rubber prices prevailed in the international market, exports of rubber products also declined significantly by 16.2 percent in April 2015, reflecting a noteworthy decline in the export of rubber tyres. Export earnings from textiles and garments which account for 46.7 percent of total exports declined by 2.0 percent during the month reflecting a reduction in exports to the EU market.”

The leading markets for merchandise exports of Sri Lanka during the first four months of 2015 were the USA, UK, India, China and Germany accounting for about 51 percent of the total exports, the Central Bank said.

Reserves at US$ 7.6 billion
The Central Bank said gross official reserves are estimated to have increased to US$ 7.6 billion by 22 June 2015, with the receipt of the proceeds of the latest international sovereign bond and Sri Lanka development bonds issuances, the currency swap arrangement between Central Bank of Sri Lanka and Reserve Bank of India and other currency inflows.

Vehicle imports almost double
Sri Lanka’s import expenditure on vehicles has risen by a staggering 95.7% to US$385 million in the first four months of this year, official figures released by the Census and Statistics Department last week showed. Accordingly, in the month of April alone, import expenditure on vehicles increased by 96% to US$94.4 million. During the four months from January 2015 to April 2015, import expenditure on consumer goods (which consists of food and beverages and non-food consumer goods including vehicles) has grown by 50% to US$1.57 billion while import expenditure on investment goods (consists of imports of machinery and equipment, building materials, etc) rose at a comparatively slower pace of 22.3% to US$1.55 billion.