Home » Sri Lanka’s trade deficit dropped to lowest in 2023 after 13 years – CBSL

Sri Lanka’s trade deficit dropped to lowest in 2023 after 13 years – CBSL


By: Staff Writer

February 04, Colombo (LNW): Even after Covid-19 pandemic hit in 2020, tearing the heart out of the island’s lucrative export earnings, the Sri Lankan trade deficit – the gap between its imports and exports; last year – has dropped significantly due to lowering of imports substantially

Ranil Wickremesinghe, who took over the presidency after the discredited and reviled Gotabaya Rajapaksa fled the country in July 2022, has been clear that Sri Lanka’s road to recovery will have to involve addressing the imbalance at source, and, in particular, driving up exports.

The Central Bank of Sri Lanka (CBSL) says that the cumulative deficit in Sri Lanka’s trade account narrowed to USD 4.9 billion from USD 5.2 billion within last year, the lowest recorded since 2010.

However, the CBSL also stated that the country’s trade deficit widened in December 2023 compared to the trade deficit recorded a year earlier.

The Central Bank made those disclosures while presenting its latest reports on the performance of the external sector of the country’s economy.

In December, Sri Lanka’s merchandise exports revenue declined by 6.2% to USD 1 billion from a year earlier, due to a decline in earnings from industrial exports and mineral exports, while an increase was recorded in agricultural exports in December 2023.

The Central Bank said cumulative export earnings during the period from January to December also declined by 9.1% compared to 2022, to USD 11.91 billion.

Meanwhile, expenditure on merchandise imports increased to USD 1.48 billion in December 2023, compared to USD 1.42 billion in the same month in 2022.

The year-on-year increase in imports were mainly led by imports of investment goods and consumer goods amidst the relaxation of import restrictions.

A Central Bank report said the cumulative import expenditure in 2023 declined by 8.1% to USD 16.8 billion over the corresponding period of 2022.

Meanwhile, workers’ remittance increased notably to USD 570 million in December 2023 compared to USD 537 million in November 2023. The same figure in December a year earlier stood USD 476 million.

As a whole, Workers’ remittances in 2023 amounted to USD 5.97 billion, compared to USD 3.789 billion in 2022, recording a year-on-year growth of 57.5%.

Total Departures for foreign employment in 2023 were recorded at 297,656. The same figure in 2022 was recorded at 311,056.

Earnings from tourism in November 2023 stood at USD 205 million while in December last year earnings were estimated at USD 269 million, marking a stark increase from USD 127 million earned through tourism in December 2022.

In aggregate, earnings from tourism in 2023 amounted to USD 2.068 billion, compared to USD 1.136 billion in 2022, recording a year on year growth of 82%.

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