Saturday Nov 23, 2024
Saturday Nov 23, 2024
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Sri Lanka’s export sector in July managed to sustain over $ 1 billion performance compared to June 2023, though on a year-on-year (YoY) basis, it fell by 12% due to sluggish demand in major markets.
As per the provisional data released by the Export Development Board (EDB) yesterday, earnings from merchandise exports increased by 2.18% month-on-month to $ 1.02 billion in July 2023, but down by 11.79% YoY.
The EDB said the drop in merchandise exports is due to the lower demand shown in export products, especially in apparel and textiles, rubber and rubber-based products and coconut and coconut-based products.
From January to July 2023, cumulative merchandise exports saw a substantial decline of 10.26% to $ 6.89 billion compared to the corresponding period of 2022.
The estimated value of services exports for the period of January to July 2023 was $ 1.22 billion, registering an increase of 17.32% over the corresponding period of 2022. The services export estimated by EDB consists of ICT/BPM, construction, financial services and transport and logistics.
The EDB has set a forecast performance of $ 18.51 billion in merchandise and service exports in 2023. This comprises $ 15.93 billion from merchandise exports up from $ 13.01 billion achieved in 2022 and $ 2.58 billion from services exports.
Major Exports in July 2023
Export earnings of coconut kernel products and coconut fibre products increased by 3.95% and 0.92%respectively in July 2023 compared to July 2022.
export earnings from coconut milk powder, coconut cream and liquid coconut milk which are categorised under the coconut kernel products increased by 41.64 %, 23.05% and 10.16% respectively in July 2023 compared to July 2022.
Being the largest contributor to the coconut-based sector, coco peat, fibre pith and moulded products which are categorised under the coconut fibre products, increased by 1.99% to $ 15.35 million in July 2023 in comparison to July 2022.
In addition, export earnings from spices and essential oils increased by 10.68% to $ 37.53 million in the month of July 2023 compared to the month of July 2022 with a strong performance in the export of pepper (222.27%).
Export earnings from ornamental fish increased by 32.35% to $ 1.80 million in July 2023 compared to July 2022.
The value of ICT exports is estimated to increase by 45.5% to $ 132.25 million in July 2023 compared to July 2022. In addition, the value of transport and logistics services exports is estimated to increase by 26.45% in July 2023 compared with July 2022.
Export earnings from apparel and textiles have decreased by 22.28% YoY to $ 427.48 million in July 2023 compared to July 2022.
In addition, export earnings from tea which made up 12% of merchandise exports, decreased by 1.97% YoY to $ 115.2 million in July 2023 compared to July 2022. The earnings from the export of tea packets decreased by 1.93% YoY to $ 55.49 million.
Export earnings from rubber and rubber finished products have decreased by 11.13% YoY to $ 79.31 million in July 2023, with negative performance in exports of pneumatic and retreated rubber tyres and tubes (-5.76 %) and industrial and surgical gloves of rubber (-25.08%).
In addition, export earnings from the EEC decreased by 1.04%YoYto $ 40.82 million in July 2023 with poor performance in exports of electrical transformers (-32.13 %).
Export earnings from seafood decreased by 16.46% to $ 17.25 million in July 2023 compared to July 2022. This decrease was mainly due to the poor performance in the export of shrimps (-70.51%) and frozen fish (-4.27%).
On monthly analysis, export earnings of coconut-based products decreased by 5.67% in July 2023 compared to July 2022. Export earnings of coconut shell products decreased by 31.14% to $ 11.52 million in July 2023 compared to July 2022. Earnings from activated carbon, which is categorised under the coconut shell products decreased by 30.37% to $ 10.64 million in July 2023 compared to July 2022.
Major exports during January - July
Earnings from the export of tea, spices and concentrates, gems and jewellery and EEC increased by 8.03%, 11.57%, 19.06 %and 10.0% respectively during the period of January - July 2023 compared with the corresponding period of 2022.
Earnings from the export of tea increased by 8.03% to $ 750.72 million due to the increase of all the subcategories of the tea sector except bulk tea and tea bags. earnings from tea packets, instant tea, green tea and other tea increased by 13.5%,44.71 %, 57.65% and 48.41% in the period of January-July 2023.
In addition, export earnings from spices and essential oils increased YoY by 11.57% to $ 216.73 million in the period of January to July 2023. Export earnings from cloves increased YoY by 247.25% to $ 35.94 million in the period of January to July 2023.
Meanwhile, earnings from the export of EEC increased by 10.0% to $ 296.58 million in the period of January to July 2023 compared to the corresponding period of 2022.
earnings from export of printed circuits, switches/boards and panels, boilers/ piston engines/ pumps and vacuum pumps and other EEC increased by 49.86%, 13.28% and 827.71%respectively in the period of January to July 2023 compared to the corresponding period of 2022.
The value of ICT exports is estimated to increase by 17.78% to $ 793.8 million in the first seven months of 2023 compared to the corresponding period of 2022. In addition, construction and financial services exports are estimated to increase by 130.21%and 37.77% respectively in the period of January to July 2023 compared with the corresponding period of 2022.
Earnings from export of apparel and textiles decreased by 18.10% to $ 2.88 billion during the period of January -July 2023 compared to the same period of 2022. The export of apparel declined by 18.98% and the export of textiles declined by 7.64% from January to July 2023.
in addition, export earnings from rubber and rubber finished products decreased by 12.67%to $ 529.08 million in January-July 2023 compared with the same period of 2022 attributed to lower exports of industrial and surgical gloves of rubber (-26.49%) and pneumatic and retreated rubber tyres and tubes (-6.02%).
For the period of January to July 2023, export earnings from coconut and coconut-based products decreased by 19.68% to $ 402.80 million from the same period last year. earnings from all the major categories of coconut-based products decreased in the period of January – July 2023 compared with the corresponding period of 2022 due to the poor performance in the export of coconut oil (-24.96 %), desiccated coconut (-35.75%), coconut milk powder (-12.37 %), coconut cream (-21.13 %), liquid coconut milk (-12.28%), cocopeat (-16.61%) and activated carbon (-16.81%).
further, export earnings from seafood decreased by 8.10%to $ 149.63 million during the period of January to July 2023 compared to the year 2022 due to the poor performance in frozen fish (-6.74 %), fresh fish (-5.93 %) and shrimps (-38.02%).
Export performance in major markets
Out of the top 10 export markets, only UAE has shown strong performance during the month of July 2023 and the period of January to July 2023 compared to the corresponding period in the previous year.
Further, India, UAE and France have shown strong performance during the month of July 2023 compared to July 2022.
Exports to the US – Sri Lanka’s single largest export destination, decreased 15.60% to $ 253.79 million in July 2023 compared to July 2022. Further, exports to the US decreased by 18.5% to $ 1.62 billion in the period of January to July 2023 compared to the same period in 2022.
Exports to FTA partners
Exports to Free Trade Agreement (FTA) partners accounted for 6.5% of total merchandise exports and have increased by 27.99% to $ 87.98 million in July 2023 compared to July 2022.
Exports to India increased by 29% while exports to Pakistan increased by 16.93% in July 2023 compared to July 2022.
Strong performance recorded in India led by increased exports of pepper (240.44 %) and areca nut (75.13%). Better performance recorded in Pakistan led by increased exports of sheet rubber and desiccated coconut.
During the period of January to July 2023 exports to FTA partners accounted for 7.2% of total merchandise exports decreased by 2.37% to $ 534.45 million compared with the corresponding period of the previous year.
Exports to India and Pakistan decreased by 1.37% and 13.01% respectively during the period of January to July 2023 when compared with the corresponding period of 2022.
Decreased exports to India led by poor export performance of animal feed (-2.24%), pepper (-12.53%), areca nut (-7.92%) and wood pulp (-47.79%) and decreased exports to Pakistan led by export of sheet rubber (-18.49%) and desiccated coconut (22.98%).
Sri Lanka’s export performance in regions
Exports to the European Union (EU) which comprised 21% of Sri Lanka’s exports during the month of July 2023 fell by 16.18% YoY to $ 230.47 million. Further, during the first seven months, exports to the European Union (EU) decreased by 12.79% YoY to $ 1.54 billion compared to the corresponding period of the previous year.
During the period of January to July 2023, the breakdown of exports to the top five EU markets which accounted for 78% of Sri Lanka’s total exports to the EU were; Germany $ 349.9 million (down by 22.33%), Italy $ 381.23 million (up by 6.13 %), Netherlands $ 197.11 million (down by 15.72%), Belgium $ 132.51 million (down by 28.89%) and France $ 152.25 million. (down by 1%).
