Exports
increase but trade gap widens
Export earnings during the first eight months of 2003 increased
by 11 per cent to $3,341 million, in contrast to the drop of nine
per cent in the comparable period in 2002, the Central Bank said.
Similarly,
imports up to August 2003 increased by nine per cent to $ 4,217
million as against a decrease of six per cent in the same 2002 period.
The growth has enabled both exports and imports to exceed the levels
recorded during the period January-August 2001.
The trade deficit
in the first eight months of 2003 increased marginally to $876 million,
compared with a deficit of $866 million recorded during the first
eight months of 2002.
Increased foreign
exchange inflows due to growth in tourism, port services, private
transfers and capital account flows increased foreign exchange liquidity,
thereby enabling the Central Bank to purchase a sum of $258 million
from the market during the first eight months of 2003.
Export earnings
in August, 2003 were at $470 million, the second largest earnings
for a month during the last eight months. However, this level of
export earnings was lower by 17 per cent when compared with the
unusually high base value of $568 million recorded in August 2002.
Notwithstanding
this drop, the overall trend of improving exports during the last
12 months remained unchanged. Expenditure on imports at $523 increased
by 14 per cent in August 2003, as against a six per cent growth
recorded in August 2002. As a result, the surplus of $110 million
in August 2002 turned to a deficit of $53 million in August 2003.
Export earnings
in August, 2003 amounted to $470 million, compared with $568 million
in August 2002. Earnings from textile and garment exports was at
$245 million in August 2003 in comparison to $339 million in August
2002.
The level recorded
stands favourably with the average export earnings from textile
and garment exports, but was lower than the exceptionally high base
in August 2002.
Though exports
of rubber based products (- 6 per cent), machinery, mechanical and
electrical equipment (- 14 per cent) declined over August 2002,
their increasing trend observed in the past few months continued.
Exports of
crustaceans and molluscs declined by 15 per cent compared to August
2002 due to off- harvesting season in shrimp farms. Export earnings
from diamonds and jewellery (11 per cent), chemicals (9 per cent)
and articles of wood (22 per cent) increased over August 2002. The
earnings from gems showed a recovery (growth of 62 per cent) reversing
the declining trend experienced since February 2003.
Export earnings
from agricultural products in August, 2003 increased by one per
cent over those of August 2002. The increases in rubber, pepper
and un-manufactured tobacco exports were partly offset by the lower
export earnings from tea, coconut, cinnamon and clove exports.
Earnings from
tea declined by two per cent in August 2003 due to drop in volume
which offset the impact of high tea prices. The reason for the drop
in volume was the decline in tea production in May and June, 2003.
However, this will be a temporary situation as the tea production
recovered recording increases of 2.2 million kg in July and 3.5
million kg in August 2003, from the adverse effects of the floods
in Southern tea growing areas in May 2003.
Expenditure
on imports, amounting to $523 million, increased by 14 per cent
in August, 2003, compared with imports amounting to $458 million
in August 2002.
The expenditure on imports during the first eight months of 2003
was $4,217 million, recording an increase of nine per cent over
the imports of $3,876 million in the first eight months of 2002.
Intermediate
goods contributed to 53 per cent of the growth in imports in August,
2003. Imports of intermediate goods increased by 13 per cent in
August 2003 due to higher import of petroleum products, diamonds
and other intermediate goods.
Investment
goods imports increased by 14 per cent in August 2003. Within this
category, machinery and equipment imports increased by 38 per cent,
while import of transport equipment and building materials increased
marginally. Food imports increased by 26 per cent reflecting the
higher imports of wheat, milk products and fish products.
Imports of
non-food consumer goods increased by 10 per cent reflecting higher
increases in imports of motor cars and cycles.
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