By: Staff Writer March 05, Colombo (LNW): Sri Lanka’s merchandise trade deficit in January widened to US$ 514 million from US$ 445 million in the corresponding month the previous year due to a higher increase in imports. Provisional data released by the Central Bank this week showed that earnings from merchandise exports recorded a marginal decline of 0.8 percent Year-on-Year (YoY) to US$ 971 million in January 2024 compared to US$ 978 million in January 2023. In terms of merchandise imports, expenditure increased by 6.2 percent YoY to US$ 1,512 million in January 2024 The increase in expenditure on consumer goods and investment goods partly driven by the relaxation of import restrictions contributed to this increase, the Central Bank said The decline in industrial goods exports in January 2024 compared to January 2023 was mainly contributed by garments, resulting from lower exports of garments to most major markets. However, earnings from petroleum products increased due to the increase in volumes of bunkering and aviation fuel exports. Earnings from the exports of agricultural goods improved in January 2024, compared to a year ago, mainly contributed by minor agricultural products, coconut related products, and tea. Meanwhile, earnings from mineral exports declined due to the base effect of higher exports of zirconium ores in January 2023. Expenditure on merchandise imports increased by 6.2 per cent to US dollars 1,512 million in January 2024 compared to US dollars 1,423 million in January 2023. The increase in expenditure on consumer goods and investment goods partly driven by the relaxation of import restrictions contributed to this increase. Meanwhile, earnings from mineral exports declined due to the base effect of higher exports of zirconium ores in January 2023. The increase in the expenditure on consumer goods imports in January 2024 compared to a year ago was resulted by a broad-based increase in expenditure on both food and non-food consumer goods. Meanwhile, expenditure on intermediate goods imports declined driven by lower fuel imports partly owing to higher hydro power generation. In contrast, expenditure on base metals increased notably while expenditure on textiles and textile articles imports also increased. Expenditure on investment goods increased mainly driven by higher imports of machinery and equipment while expenditure on building material imports also increased, owing to higher iron and steel imports. Expenditure on merchandise imports increased by 6.2 per cent to US dollars 1,512 million in January 2024 compared to US dollars 1,423 million in January 2023. The increase in expenditure on consumer goods and investment goods partly driven by the relaxation of import restrictions contributed to this increase.