Sri Lanka’s merchandise exports decreased by 1.96 % to US$ 1,037.5 Million in March 2023 compared to March 2022. Moreover, it is a 5.14 % decrease when compared to March 2021. Less demand created for major products in major markets due to the current economic situation further continues.
The Figure 1 shows the comparison of Monthly Merchandise Export Performance 2020- March 2023.
Sources: Central Bank of Sri Lanka, Sri Lanka Customs
Major Exports in March 2023
a) Products & Services with Positive Growth (Increased)
Export earnings from tea which made up 12% of merchandise exports, increased by 16.34 % y-o-y to US$ 110.15 Mn in March 2023 compared to March 2022. Earnings from export of Tea packets increased by 32.46 % to US$ 58.4 Mn while export of Bulk Tea decreased by 0.52% to US$ 46.25 Mn in March 2023 compared to March 2022.
In addition, Export earnings from Rubber and Rubber Finished products have increased by 6.01 % y-o-y to US$ 91.19 Mn in March 2023, with positive performance in exports of Pneumatic & Retreated Rubber Tyres & Tubes (14.65 %). However, earnings from exports of Industrial & surgical gloves decreased by 3.97% to US$ 21.76Mn in March 2023 compared to March 2022.
Moreover, export earnings from the Electrical & Electronics Components increased by 18.35% y-o-y to US$ 45.54 Mn in March 2023 with strong performance in exports of Other Electrical & Electronic Products (24.34%).
Earnings from Activated Carbon, which is categorised under the Coconut shell products increased y-o-y by 1.81% to US$ 14.02 Mn in March 2023.
Export earnings from Spices and Essential Oils increased by 38.77 % to US$ 32.57 Mn in the month of March 2023 compared to month of March 2022 with strong performance in Cinnamon (66.24 %) and Cloves (216.58 %). Despite the increase recorded in the sector, earnings from Pepper & Essential Oils decreased by 21.4 % and 35.77% respectively in March 2023 compared to March 2022.
Export earnings from Seafood increased by 14.57% to US$ 25.71 Mn in March 2023 compared to March 2022. This increase was mainly due to the strong performance in export of Frozen fish (9.47 %), Fresh fish (7.04 %) and Shrimps (0.34%).
Moreover, export earnings from Ornamental fish increased by 50.63 % to US$ 2.38 Mn in March 2023 compared to March 2022.
The value of ICT exports is estimated to increase by 33.68% to US$ 132.25 Mn in March 2023 compared to March 2022. In addition, value of Construction and Financial services exports are estimated to increase by 206.9% and 2.53% respectively in March 2023 compared with March 2022.
b) Products & Services with Negative Growth (Decreased)
However, export earnings from Apparel & Textile have decreased by 10.1 % y-o-y to US$ 416.17 million in March 2023 compared to March 2022. Both earnings from exports of Apparel and Textiles decreased by 10.68 % and 3.61% respectively in March 2023 compared to March 2022.
On monthly analysis, export earnings of kernel products and fiber products categorized under the Coconut based decreased by 24.96 % and 15.10 % respectively in March 2023 compared to March 2022. Further, earnings from Coconut shell products stagnated in March 2023 compared to March 2022.
Export earnings from Liquid Coconut Milk, Coconut Oil and Desiccated Coconut which are categorised under the Coconut kernel products decreased by 17.14 %, 26.24% and 36.97% respectively in in March 2023 compared to March 2022.
Being the largest contributor to Coconut based sector, Coco Peat, Fiber Pith & Moulded products which are categorized under the Coconut fibre products, decreased by 12.43 % to US$ 14.02 Mn in March 2023 in comparison to March 2022.
The value of Transport & Logistics exports is estimated to decrease by 37.04 % to US$ 40.25 Mn in March 2023 compared to March 2022.
Major Exports during the period of January - March 2023
For the period of January to March 2023, overall merchandise exports decreased by 7.88 % to US$ 2,997.6 Million compared to the corresponding period of 2022.
a) Products & Services with Positive Growth (Increased)
Earnings from export of Tea, Spices and Concentrates and Electronics & Electronic Components increased by 9.59 %, 18.63 % and 12.96 % respectively during the period of January - March 2023 compared with the corresponding period of 2022.
Earnings from export of Tea increased by 9.59 % to US$ 314.28 Mn during the period of January to March 2023 compared with the corresponding period of 2022. Exports of all the sub categories of tea sector except Bulk Tea and Tea Bags; Tea packets (20.56 %), Instant Tea (69.64 %) and Green Tea (25.0%) increased during the period.
Meanwhile earnings from export of Electrical and Electronic Components (EEC) increased by 12.96 % to US$ 126.81 Mn in the period of January to March 2023 compared to the corresponding period of 2022.
Earnings from export of Switches, Boards & Panels and Other Electrical & Electronic Products increased by 36.07 %, and 20.91 % respectively during the period of January to March 2023 compared with the corresponding period of previous year.
The value of ICT exports is estimated to increase by 33.59% to US$ 397 Mn in the first quarter of 2023 compared to the corresponding period of 2022. In addition, Construction and Financial services exports are estimated to increase by 75 % and 2.15% respectively in the period of January to March 2023 compared with the corresponding period of 2022.
b) Products & Services with Negative Growth (Decreased)
Earnings from export of Apparel & Textile decreased by 13.77% to US$ 1,269.42 Mn during the period of January to March 2023 compared to the same period of 2022, export of Apparel down by 14.9 % while export of Textiles expanded by 0.01% in January to March 2023.
In addition, export earnings from Rubber & Rubber finished products decreased by 8.51 % to US$ 243.62 Mn in January - March 2022 compared with the same period of 2022 attributed to lower exports of Industrial & Surgical Gloves of Rubber (-26.63%).
For the period of January to March 2023, export earnings from Coconut & Coconut based products decreased by 22.10 % to US$ 162.58 Mn from the same period last year. Earnings from all the major categories of Coconut based products decreased in the period of January – March 2023 compared with the corresponding period of 2022 due to the poor performance in export of Liquid Coconut Milk (-20.62%), Coconut cream (-33.21%), Coconut Milk Powder (-30.64%), Cocopeat (-26.31%), Activated Carbon (-5.43%), Coconut Oil (-16.61%) and Desiccated Coconut (-39.57%).
Export earnings from Seafood decreased by 1.62% to US$ 66.63 Mn during the period of January to March 2023 compared to year 2022 due to the poor performance in all the sub categories; Frozen Fish (-1.91 %) and Prawns (-30.6 %).
The value of Transport & Logistics exports is estimated to decrease by 37.11 % to US$ 121 Mn in the first quarter 2023 compared to corresponding period of 2022.
Table 1 shows the comparison of monthly and quarterly Merchandise export performance during the month of March 2023 and the period of January to March 2023 compared to corresponding period of previous year.
Sri Lanka’s Export Performance in Major Markets
Out of top 5 export markets, only the Italy market has shown a positive performance both in the month of March 2023 and during the period of January to March 2023.
UAE has shown a positive performance compared to the corresponding period of previous year.
Exports to United States of America, Sri Lanka’s single largest export destination, decreased by 9.68 % to US$ 235.87 Mn in March 2023 compared to March 2022. Further, exports to United States of America decreased by 14.96 % to US$ 721.70 Mn during the period of January to March 2023 compared to the same period in 2022.
Table 2 shows the comparison of monthly and quarterly Merchandise export performance of top 15 export markets during the month of March 2023 and the period of January to March 2023 compared to corresponding period of previous year.
Exports to FTA Partners
During the month of March 2023, exports to Free Trade Agreement (FTA) partners accounted for 6.5 % of total merchandise exports has decreased by 8.79 % to US$ 74.27 Mn.
Exports to India and Pakistan decreased by 7.02 % and 26.56 % respectively in March 2023 compared to March 2022.
Poor performance recorded in India led by lower exports of Animal feed (-6.48%), Pepper (-23.57%) and Wood pulp (-34.78%) and poor performance recorded in Pakistan led by lower exports of Sheet rubber and Desiccated Coconut.
Moreover, exports to Free Trade Agreement (FTA) partners accounted for 7.2% of total merchandise exports decreased by 9.07 % to US$ 223.69 Mn during the period of January to March 2023 compared with the corresponding period of previous year.
During the period of January to March 2023 Exports to India and Pakistan decreased by 6.48% and 34.23% respectively when compared with the corresponding period of 2022.
Decreased exports to India led by poor export performance of Pepper (-45.95%) and decreased exports to Pakistan led by export of sheet rubber and Desiccated Coconut during the January – March 2023.
Sri Lanka’s Export Performance in Regions
Table 3 shows the comparison of region wise exports during the month of March 2023 and the period of January to March 2023 compared to corresponding period of previous year.
Exports to the European Union (EU) which comprised 21% of Sri Lanka’s exports during the month of March 2023 decreased by 0.2 % y-o-y to US$ 654.84 Mn. Further, exports to the European Union (EU) decreased by 9.81 % y-o-y to US$ 654.84 Mn during the period of January to March 2023 compared to the corresponding period of previous year.
During the period of January to March 2023, breakdown of exports to the top five EU markets which accounted for 78 % of Sri Lanka’s total exports to the EU were; Germany US$ 154.16 Mn (decreased by 14.74 %), Italy US$ 158.44 Mn (increased by 5.74 %), Netherlands US$ 83.63 Mn (decreased by 18.56 %), Belgium US$ 55.67 Mn (decreased by 19.44 %) and France US$ 57.3 Mn. (decreased by 11.71 %).
Export of Services
The estimated value of services exports for the period of January to March 2023 was US$ 543 Million, increasing 5.8 % over the corresponding period of 2022. The services exports estimated by EDB consists of ICT/BPM, Construction, Financial services and Transport & Logistics.
Policy & Strategic Planning Division - 03.05.2023
