Oct 21, Colombo: Sri Lanka's trade deficit in August 2013 declined sharply as favorable developments in the external sector continued , the Central Bank said Monday in its External Sector Performance review for the month.
Earnings from exports increased for the third consecutive month in August 2013 as global economy gradually recovered while expenditure on imports declined.
Accordingly, the cumulative trade deficit contracted further during the first eight months of 2013 by 5.6 percent improving the current account of the Balance of Payments (BOP).
Earnings from exports grew 10.7 percent to US$ 917.8 million in August 2013 on a year-on-year basis, while expenditure on imports declined by 7.7 percent to US$ 1.62 billion.
On cumulative terms for the first eight months of the year, exports earnings declined 1.0 percent to US$ 6.44 billion while the imports expenditure declined by 3.3 percent to US$ 12.43 billion, creating a trade balance of US$ 6 billion.
The Central Bank said the BOP account was further strengthened by increased revenues from tourism and workers' remittances.
Earnings from Tourism increased by 34.7 percent to US$ 110.2 during the month of August while cumulatively tourism dollars increased by 22.1 percent to US$ 784.3 million in the first eight months of the year.
In August 2013, workers' remittances increased by 16.3 percent, year-on-year, to US$ 570.0 million and cumulatively in the first eight months of 2013 workers' remittances rose 10.9 percent to US$ 4.33 billion.
FDI inflows, including foreign loans to BOI companies, amounted to US$ 540.2 million during the first half of 2013, an increase of 20 percent, compared to US$ 451.7 million received during the first half of 2012.
Sri Lanka's gross official reserves stood at US$ 6.3 billion by end August 2013 while the total international reserves, which include foreign assets of commercial banks, amounted to US$ 7.5 billion, the Central Bank recorded.