However, the trade deficit showed an increasing trend on a monthly basis since February 2023. The cumulative deficit in the trade account during January to April 2023 was USD 1,444 million, a sizable decline from US dollars 3,125 million recorded over the same period in 2022.

Earnings from merchandise exports declined by 12.6 % in April 2023, over April 2022, to US dollars 849 million, recording the lowest earnings since April 2021. The decline in earnings from industrial exports, including garments, associated with slowing external demand mainly contributed to this contraction in export earnings in April 2023, compared to a year earlier.

Meanwhile, export earnings have declined month-on-month basis due to a broad-based decline in earnings from most of the major export categories, partly driven by low activities during the April holiday season Expenditure on merchandise imports declined by 15.8 %to US dollars 1,431 million in April 2023, compared to US dollars 1,699 million in April 2022.

A decline in expenditure was observed in imports of intermediate goods and investment goods, while an increase was recorded in imports of consumer goods. However, there is an increase in the import expenditure in general since March 2023. Meanwhile, cumulative import expenditure during January to April 2023 declined by 28 % over the corresponding period in 2022.

Workers’ remittances increase notably

Workers’ remittances increased notably to US dollars 454 million during April 2023 in comparison to US dollars 249 million in April 2022. Meanwhile, based on the provisional data, total departures for foreign employment during January to April 2023 and departures in April 2023 amounted to 95,892 and 19,774,respectively, compared to the annual departures of 311,056 recorded in 2022.

Tourist arrivals decline

Tourist arrivals declined in April 2023 to 105,498, compared to 125,495 arrivals recorded in March 2023, largely due to seasonal impact. In comparison, the arrivals were recorded at 62,980 in April 2022.

Meanwhile, the monthly tourist arrivals continued to exceed 100,000 level during January to April 2023, leading to cumulative arrivals recording at 441,177 compared to 348,314 arrivals recorded during the corresponding period in 2022. Consequently, earnings from tourism during January to April 2023 amounted to US dollars 696 million, compared to US dollars 591 million in the comparable period in 2022. Earnings from tourism in April 2023 were estimated at US dollars 167 million, in comparison to US dollars 198 million in the previous month and US dollars 109 million in the corresponding month in the previous year.

Notable net inflow of US dollars

Foreign investments in the government securities market recorded a notable net inflow of US dollars 140 million in April 2023, while cumulative net inflow during January to April 2023 amounted to US dollars 252 million. Gross official reserves continued to increase, recording at US dollars 2.8 billion at end April 2023. This included the swap facility from the People’s Bank of China, equivalent to around US dollars 1.4 billion, which is subject to conditionalities on usability.

During the year up to May 31, 2023, the Sri Lanka rupee appreciated by 22.9 % against the US dollar.

Provided by SyndiGate Media Inc. (Syndigate.info).