Garment exports accelerate despite weakening US demand

29 Jul '08

2 min read

During the first four months of 2008, export earnings of Sri Lanka grew by 12 percent to touch US $2,498 million.

Of this, industrial export revenues accounted for $1,831 million registering a growth of 4 percent while gems and processed diamond exports also recorded an increase. Textile and garment exports fetched $1,033 million reflecting a growth of four percent in spite of a weakened demand from the US markets.

Besides, industrial export of leather among others also reflected a considerable improvement earning $251 million in the first quarter of 2008. However, it was the agricultural sector which posted a remarkable growth of 37 percent to secure $590 million, increasing both in terms of volume as well as value.

On the import front, the first four months saw the country spending around $4,533 million and marking an increase of 37 percent over the corresponding period of 2007. Import bill for petroleum in particular saw a surge of 76 percent reaching $1,115 million in the first quarter of the year against $632 million recorded during the same period last year. Reasons for this have been attributed to an uncontrollable hike in international oil prices which has affected almost all the countries in various ways.

However, it has been noted that even after not considering petroleum products, expenditure on imports recorded a 28 percent growth in the period between January and April of this year. Import of investment goods amounted to $1,013 million, a 31 percent increase over the same period last year.

Considering these remarkable developments, the cumulative trade deficit by April reached $2,036 million against $1,061 million recorded in the corresponding period of 2007. Petroleum products contributed to about 55 percent of the total trade deficit.

The Balance of Payments (BoP) generated a surplus of $292 million by the end of May 2008 compared to US $250 million recorded by the end of May 2007.