Sri Lanka’s trade deficit widened 141.7 percent in October 2014 as the import expenditure significantly increased while the earnings from exports declined, the Central Bank said in its External Sector Performance Review released Friday.
The increase in import expenditure in the month was mainly due to the significant increase in imports of fuel and personal vehicles, the Central Bank said.
The trade deficit widened to US$ 851.7 million in October 2014, compared to US$ 352.3 million a year ago.
On a cumulative basis, trade deficit in the first ten months of 2014 increased by 4.3 percent to US$ 6.78 billion compared to the corresponding period in 2013.
Earnings from exports decreased by 13.7 percent, year-on-year, in October 2014 to US$ 898.5 million while the cumulative earnings increased by 9.7 percent to US$ 9.18 billion during the first ten months of 2014.
Expenditure on imports increased by 25.6 percent, year-on-year, to US$ 1.75 billion in October 2014, while on a cumulative basis, imports grew by 7.3 percent to US$ 15.97 billion during the first ten months of 2014.
In the month Industrial exports declined by 14 percent to US$ 663.4 million while Agricultural exports declined by 10.3 percent to US$ 231.1 million in October 2014 compared to the same period last year. Export earnings from tea declined 8.5 percent in October 2014 to US$134.3 million.
Textiles and garment exports declined by 8.7 percent to US$ 398.4 million in October 2014 compared to same period last year.
The increase in import expenditure in October 2014 was mainly due to the significant increase in imports of fuel followed by imports of personal vehicles such as motor cycles and motor cars for personal use. Despite the decline in refined petroleum imports, expenditure on fuel increased significantly due to increase in crude oil imports, the Central Bank said.
Earnings from tourism increased by 21.9 percent in the month to US$ 175.7 million and cumulatively increased 30.4 percent to US$ 1.775 billion for the first ten months of the year.
The rupee remained stable against the US dollar with only a marginal depreciation of 0.2 percent as at 09 December 2014.
By the end of October 2014, Sri Lanka’s gross official reserves amounted to US$ 8.8 billion, while total international reserves, which include foreign assets of commercial banks, amounted to US$ 10.3 billion.