Mar 25, Colombo: Sri Lanka's trade deficit in January 2014 narrowed further by 5.9 percent to US$ 756 million as earnings from exports substantially increased compared to the increase in expenditure on imports during the month, the Central Bank said Tuesday releasing the External Sector Performance review.
Earnings from exports in January 2014 increased significantly on a year-on-year (YoY) basis by 23.2 percent to US$ 898 million, while expenditure on imports increased by 7.9 percent to US$ 1.654 billion.
Improved performance in industrial exports, followed by agricultural exports, led the significant growth in exports.
Earnings from industrial exports, which account for more than three fourths of total export earnings increased by 23.6 percent, year-on-year, to US$ 692 million in January 2014, reflecting an increase in earnings from all major industrial export categories except petroleum products.
Textiles and garments which is the main contributor to the growth in industrial exports grew by 23.4 percent to US$ 412 million.
Earnings from agricultural exports increased 21.6 percent for January to US$ 203.2 million, out of which exports of rubber products amounted to US$ 73.2 million.
Expenses on fuel imports increased 68.1 percent to US$ 489.6 million in the month compared to January 2013 while expenses in most of other categories declined.
During the month Workers' Remittances grew by 10.6 percent to US$ 555.5 million and earnings from tourism increased 32.2 percent to US$ 161.2 million. However, inflows to the government from Treasury Bills and Bonds declined 46.3 percent YoY and only earned US$ 260.5 million.
By the end of 2013, Sri Lanka's gross official reserves amounted to US$ 7.5 billion, while total international reserves, which include foreign assets of commercial banks up to November 2013, amounted to US$ 8.6 billion.
The domestic foreign exchange market has remained relatively stable during the year so far, with the rupee marginally appreciating by 0.1 percent against the US dollar during the period from end 2013 to 20 March 2014, the Central Bank said.