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Sunday Sep 22, 2024
Friday, 20 June 2014 00:00 - - {{hitsCtrl.values.hits}}
The total economic output of Sri Lanka as measured by Gross Domestic Product for the first quarter of 2014 (January, February, March) is reported an increase of Rs. 857,497 million compared to the first quarter of 2013 which was reported as Rs. 796,720 million and obtained a positive growth rate of 7.6 over the period.
The three main pillars of the economy, Agriculture, Industries and Services sectors, have shared the GDP at constant price (2002) by 11.5%, 32.7% and 55.8% respectively in the first quarter of 2014.
The achieved growth rates compared to 2013 first quarter of these three sectors are 0.2% in ‘Agriculture,’ 12.6% in ‘Industries’ and 6.5% in ‘Services’ respectively.
The sub sectors which reported higher growth rates compared to 2013 are ‘Coconut production’ by 6.7%, ‘Fishing’ by 13.3%, ‘Mining and quarrying’ by 15.4%, ‘Textile, Wearing apparel and Leather products’ by 16.5%, ‘Construction’ by 22.5% and ‘Hotels and Restaurants’ by 23.2 respectively.
In the meantime the sub sectors of ‘Tea’, ‘Rubber,’ ‘Paddy,’ ‘Minor Exports Crops’ and ‘Plantation Development’ showed a decrease in growth rates as 2.3, 1.1, 5.7, 3.1 and 7.4 respectively.
GDP implicit price deflator which measures the price change in the economy with respect to a specific base year (2002=100), increased to 271.5 in the year 2014 from 257.6 in 2013 recording a 5.4% of inflation rate for year 2014.
In the first quarter of year, Colombo Consumer Price index (CCPI) (2006/2007=100) reported as 177.7 compared to the value of first quarter in year 2013, of 170.5, which indicate the inflation rate in 2014 first quarter as 4.2%.
Agriculture sector
The growth rate of the Agriculture sub sector, including Agriculture, Livestock and Forestry, decreased by 1.2% in the first quarter of 2014 compared to the 2.3% growth recorded in first quarter 2013.
The value addition for the Tea sub sector is decreased by 2.3% in this quarter. Tea production has decreased by 10%% due to the drought recorded in tea grown areas especially in Ratnapura, Kalutara, Galle and Matara Districts. This sub sector recorded a 9.0% increase in the same quarter of 2013.
The value addition of rubber dropped by 1.1% in the first quarter of 2014 and it was recorded as 23.0% decrease in the same quarter in 2013. Due to the low demand in the international market for Sri Lankan natural rubber the topping activity at ground level has worn‐out. The average price for one Kilogram of Latex rubber has dropped by 20.8% in this quarter.
The coconut sub sector which showed 7.4% decrease in the first quarter of 2013 shows an increase of 6.7% in this quarter. According to the records of Coconut Development Board, the favourable rain prevailed in the second quarter of 2013 facilitate the increase in production of coconut in the districts belonging to the Coconut Triangle. Compared to the first quarter of 2013, this quarter shows an increase in production of nuts by of 41.8 million and in the meantime the producer price also recorded as an increase of 15.7% compared to the first quarter in the last year.
The value addition of Minor Exports Crops (MEC) dropped by 3.1% in this year compared to the growth by 16.3% in the first quarter of 2013.
The value addition of paddy production sub sector has recorded a 5.7% decrease in the first quarter of 2014. This is mainly due to prolonged drought during the first three months in 2014, which consequently reduced the paddy production by 15.7%. Compared to 2012/13 Maha season, the sown and harvested extents were decreased by 16.4% and 20.3% respectively.
Live stock sub sector showed a growth of 3.1% in this quarter over the first quarter of 2013. The production of eggs has increased by 32.8% within this quarter.
Other food crops sub sector which include Highland crops, Vegetables and Fruits recorded a 1.8% slight increase in the first quarter of 2014. The value addition of highland crops sub sector decreased by 2.8% in this quarter. The value added of both sectors vegetables and fruits, increased by 4.8% and 2.1% respectively in this quarter. The drought prevailed for the first three months in this year is accountable for the insignificant growth of ‘Other food crops’ sub sector in this quarter.
The land area developed by re‐plantation and new plantations under plantation development has sharply reduced in this quarter. Compared to the first quarter in 2013, the replanted or new planted land area in the first quarter in 2014 has reduced from 180.8 hectares to 58.7 hectares for rubber and from 8,477.4 hectares to 3,807.2 hectares for coconut respectively.
Hence the percentage of value added of plantation development sub sector has dropped to 7.4%, compared to 5.3% growth recorded in the first quarter of 2013.
Overall fish production has increased by 13.3% in the first quarter of 2014. Inland fishery sub sector is increased by 95.7% in this quarter. The harvesting of the whole stock of fish including the fish fingerlings that were released to the ponds, in the third quarter of last year, before the tanks got dry due to severe drought has been the main reason for this extensive production reported in this quarter. Compared to the first quarter of 2013 Marine Fish production has also increased by 6.2% in this quarter.
Industry sector
The Industry sector which gives a contribution of 32.7% to the Gross Domestic Product at national level showed a percentage growth of 12.6 in the first quarter of 2014 compared to the growth of 10.7 at the first quarter of 2013. The manufacturing sub sector which gives the highest contribution of 54% to the Industry sector has grown by 8.9% in this quarter compared to the first quarter in 2013.
In this quarter mining and quarrying sub sector showed a growth rate of 15.4% compared to the first quarter of 2013. Within this sub sector, ‘Gem mining’ and ‘Other mining’ has increased by 7.9% and 18.0% respectively. The gem export values boosted up by 33.2% in the first quarter of 2014.
Processing industry sub sector under ‘Manufacturing sector’ showed a growth of 4.0% in this quarter. The drop in tea and rubber production in this quarter is the key reason for this trivial growth rate experienced in Processing Industry. Factory industry has grown up by 9.6% in the first quarter of 2014. The major contributors to this sub sector, ‘Food Beverages and Tobacco’ and ‘Textile Wearing Apparels and Leather Products’ showed growth rates of 9.6% and 16.5% respectively.
According to the trade indices of Central Bank for these two sectors, export quantity indexes of first quarter of 2014 has increased by 41.2 and 14.9 respectively.
The growth of ‘Electricity Gas and Water’ sub sector has been decreased by 0.3% in the first quarter of 2014 compared to the first quarter of last year. The major reason was the 1.1 drop reported in electricity generating section which is the main contributor to the electricity sector. The dry weather prevailed in catchment areas of hydro power stations is the main reason for the reduction of hydro power production. Thus thermal power generating was compelled to increase, to maintain the electricity uninterruptedly.
In this quarter the hydropower generation has decreased by 47% which was harmonised with thermal power generation increased by 46%. Hence the existed ratio of 49:51 hydro and thermal power generation in the first quarter of 2013 has changed to 26:74 in the first quarter of 2014. The cost of inputs for thermal power generating is comparatively higher than inputs of hydro power generating, and as a result, the value added of electricity sub sector has become lesser in this quarter.
In real terms, the construction sub sector indicates 22.5% growth for first quarter of 2014 compared to the growth of 18.2% in the same quarter of last year.
The government expenditure on constructions was Rs. 31,293.3 million in this quarter compared to Rs. 16,547.8 million in the first quarter of 2013 which indicates 89.1% increase in this quarter.
Services sector
The export trade sector recorded a relatively a higher growth of 16.3% in first quarter 2014, when compared to the drop of 5.1% recorded in first quarter of 2013. According to the Balance of Payment statistics of Central Bank of Sri Lanka, export earnings increased to Rs. 367,173 million in the first quarter of 2014, from Rs. 299,019 million in the first quarter 2013, indicating a growth of 22.8%. Compared to the first quarter of 2013, agricultural and Industrial exports grew by 23.6% and 20.7% respectively and earnings of mineral exports also increased by eight times in first quarter of 2014. According to the Trade Indices of Central Bank of Sri Lanka, export volume index and unit value index increased by 15.6% and 6.2% respectively in first quarter 2014.
The import trade sector grew by 4.6% in first quarter 2014 with compared to the 6.1% drop recorded in first quarter 2013. According to the Balance of Payment statistics of Central Bank of Sri Lanka the total import expenditure increased to Rs. 620,660 million from Rs. 571,873 million in the respective quarter of the last year, contributing an increase of 8.5%. According to the Trade Indices, import volume index and unit value index of this quarter grew by 5.8% and 0.9% respectively.
The domestic trade sector which recorded a 7.5% growth in first quarter 2013, further grew by 8.3% in this quarter.
In the first quarter of 2014, value added of Hotels and Restaurant sector recorded a higher growth of 23.2% with compared to the growth of 18.6% reported in first quarter 2013. The tourist arrivals increased to 421,501 in the first quarter of 2014, from 333,719 in 2013 respective quarter and reported a growth of 26.3%. Also tourist earnings increased by about 34% in this quarter with compared to the first quarter in the last year.
Transport and Communication sub sector indicated 7.3% growth in this quarter against the 9.5% growth in the reference period of year 2013. ‘Railway,’ ‘Passenger and goods transportation,’ ‘Cargo handling’ and ‘Post and Telecommunication’ sectors were grew up by 8.0%, 6.9%, 8.1%, and 9.6% respectively.
The new registration of buses and motor cars were increased by 11.8% and 3.0% respectively during this quarter. Passenger income and passenger km of Ceylon Transport Board has increased by 10.1% and 2.9% respectively compared to the first quarter of 2013.
Total container handling activities of Ports Authority has increased by 10.5% in this period.
Passenger km flown and total revenue of SriLankan Airlines has increased by 3.1% and 0.9% respectively in the first quarter of 2014. One additional aircraft were operated during the period compared with the previous quarter.
Banking Insurance and Real Estate sector recorded 5.1% growth in first quarter of 2014 against 6.1 growth reported in the same quarter in 2013. Average Weighted Lending Rate (AWLR) and Average Weighted Deposit Rates (AWDR) were recorded as 14.4% and 8.5% respectively in the first quarter of 2014. These two indicators were recorded as 16.4% and 10.7% respectively in the first quarter of 2013. Profit before tax of many banks and other financial companies showed a slight decrease in this quarter.
