April fails to match March exports momentum

• Country ships $ 799 worth of exports in April, higher by 183% from a year ago when COVID broke out, but lower than $ 1 b achieved in March

Sri Lanka’s export performance in April failed to match March’s momentum, though it was way above from lockdown-hit last year’s. 

The Sri Lanka Export Development Board (EDB) said yesterday merchandise exports in April amounted to $ 799 million, 183% higher than last year April, but 25% below the March 2021 figure of $ 1 billion. 

EDB Chairman Suresh de Mel

April performance boosted the first four months export figure to $ 3.7 billion, up 30% from $ 2.9 billion last year. 

“In comparison to the lowest point in April 2020, exports are up by 183% in April 2021. We thank the entire export community for serving the national economic needs at this vulnerable time,” EDB Chairman Suresh de Mel said.

In March 2020, merchandise exports dropped by a massive 42.3% to $ 656 million as COVID-19 tightened its grip on Sri Lanka’s economy. The drop in April could be attributed to the rapid expansion of COVID-19 globally impacting vital value chains and suffocating consumer demand.

“The EDB staff and I stand committed to help our exporters through this crisis in the best way possible,” de Mel said.

The EDB is forecasting a performance of $ 15.68 billion in merchandise and service shipments in 2021. EDB in 2021 expects $12 billion from merchandise exports and $ 3.58 billion from services exports.

In 2020, merchandise exports were $ 10 billion, down 16% from 2019. Overall exports and earnings from merchandise exports recovered to a great extent in December 2020 from the setback suffered in the previous two months due to the second wave of COVID-19.

Earnings from the export of major sectors such as apparel, tea, rubber-based products, coconut-based products, spices and electrical and electronic components improved in April as well as during the first four months compared to 2020.

Apparel export earnings in April increased by 462.38% to $ 365.04 million, whilst the first four-months growth was up 28.69% to $ 1.7 billion recorded in the same period a year earlier.

Earnings from tea saw a marginal increase of 1.14% to $ 79.26 million, whilst January to April earnings were up by 19.79% to $ 417.39 million year-on-year (YOY). It is believed that the first four-month performance was due to demand growth in UAE, China and Libyan markets.

Spices and Essential Oils earnings were also up by 85.77% to $ 22.46 million, particularly from exports of cinnamon, pepper and cloves. It also showed a significant increase of 115.4% to $ 136.76 million in the first four months compared to $ 63.49 million in the corresponding period of 2020.

Earnings from all the major categories of coconut-based products also increased by 100% to $ 55.76 million in April compared to the same period a year earlier. Similarly, earnings from the export of all the major categories of coconut-based products increased by 52% to $ 250.49 million from January to April in the corresponding period of 2020. The improved performance was seen in exports of coconut oil, liquid coconut milk, cocopeat and activated carbon.

Rubber and rubber-finished products earnings also increased by 151.22 % YOY to $ 64.74 million in April as a result of industrial and surgical gloves of rubber (188.87%) and pneumatic retreated rubber tyres and tubes (172.72%). The first four months export earnings from rubber and rubber-finished products also increased by 45.47% compared to the same period a year earlier.

Earnings from export of electrical and electronic components (EEC) increased by 186.05% to $ 27.06 million in April compared to the same period last year. Similarly, January to April exports from EEC also increased by 41.21% to $ 129.09 million compared to the corresponding period of 2020.

Being the largest single export destination, the US has absorbed $ 920.6 million worth of exports in the first four months of 2021, showing a significant increase of 21.2% in comparison to $ 759.8 million recorded in the same period a year earlier.

The United Kingdom was the second largest trading partner, recording an increase of 16% to $ 294.23 million from January to April 2021 compared with the corresponding period in 2020.

Exports to China and Netherlands increased YOY by 77.79% and 222.7% respectively, whilst the first four months increase of the same markets improved by 62% and 69.84% respectively. Strong performance made by apparel and liquid coconut milk exports has resulted in increased exports to the Netherlands and better performance of export of bulk tea, mineral sands, activated carbon and cocopeat has resulted in increased exports to China.

Exports to all other regions increased, except ASEAN during the first four-months, compared to the same period in 2020.

The services exports estimated by EDB, which includes ICT/BPM, construction, financial services and transport and logistics show exports of $ 1.2 billion in the first four months compared to $ 1.02 billion recorded in the corresponding period of 2020. Estimated service exports increased by 16.87% in the first quarter compared to the first quarter of 2020.