Sri Lanka’s merchandise exports increased by 16.6 % to US$ 989.7 Million in May 2023 compared to April 2023. However, it is a 5.59 % decrease when compared to May 2022.
Declining trend in merchandise exports further continues due to the negative trends shown in major export products specially in Apparel & Textiles and Coconut & Coconut based products.
The Figure 1 shows the comparison of Monthly Merchandise Export Performance 2020 - May 2023.
Sources: Central Bank of Sri Lanka, Sri Lanka Customs
Major Exports in May 2023
a) Products & Services with Positive Growth (Increases)
Export earnings from tea which made up 12% of merchandise exports, increased by 24.16 % y-o-y to US$ 116.33 Mn in May 2023 compared to May 2022. Earnings from export of Tea packets increased by 25.76 % to US$ 56.58 Mn.
In addition, export earnings from Rubber and Rubber Finished products have increased by 0.20 % y-o-y to US$ 76.84 Million in May 2023, with positive performance in exports of Pneumatic & Retreated Rubber Tyres & Tubes (6.82 %).
Export earnings from Spices and Essential Oils increased by 26.24 % to US$ 27.13 Mn in the month of May 2023 compared to month of May 2022. Export earnings from Cinnamon increased by 27.20 % to US$ 14.87 Mn in May 2023 compared to May 2022.
In addition, export earnings from the Electrical & Electronics Components increased by 5.0 % y-o-y to US$ 43.90 Mn in May 2023 with strong performance in exports of Insulated wire (4.50 %) and Other Electrical & Electronic Products (1.7 %).
Export earnings from Seafood increased by 36.54 % to US$ 22.98 Mn in May 2023 compared to May 2022. This increase was mainly due to the strong performance in export of Frozen fish (20.7 %), Fresh fish (2.86 %) and Shrimps (76.21%).
Moreover, export earnings from Ornamental fish increased by 85.04 % to US$ 2.35 Mn in May 2023 compared to May 2022.
The value of ICT exports is estimated to increase by 39.21 % to US$ 132.25 Mn in May 2023 compared to May 2022. In addition, value of Financial services exports is estimated to increase by 8.8 % in May 2023 compared with May 2022.
b) Products & Services with Negative Growth (Decreases)
Export earnings from Apparel & Textile have decreased by 14.55 % y-o-y to US$ 412.43 Million in May 2023 compared to May 2022.
On monthly analysis, export earnings of kernel products, fiber products & shell products categorized under the Coconut based decreased by 3.70 %, -9.59 % and -4.23 % respectively in May 2023 compared to May 2022.
Export earnings from Coconut Oil and Desiccated Coconut which are categorized under the Coconut kernel products decreased by 17.46 % and 24.04% respectively in May 2023 compared to May 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 9.81 % to US$ 15.45 Mn in May 2023 in comparison to May 2022.
Earnings from Activated Carbon, which is categorized under the Coconut shell products decreased by 4.23 % to US$ 14.05 Mn in May 2023 compared to May 2022.
The value of Transport & Logistics exports is estimated to decrease by 9.17 % to US$ 40.25 Mn in May 2023 compared to May 2022. Also, export value of Construction services is also estimated to decrease by 42.62 % in May 2023 compared with May 2022.
Major Exports during the period of January – May 2023
For the period of January to May 2023, overall merchandise exports decreased by 8.29 % to US$ 4,835.99 Million compared to the corresponding period of 2022.
a) Products & Services with Positive Growth (Increases)
Earnings from export of Tea, Spices and Concentrates, Gems & Jewellery and Electronics & Electronic Components increased by 13.69 %, 16.43 %, 36.18% and 11.77 % respectively during the period of January - May 2023 compared with the corresponding period of 2022.
Earnings from export of Tea increased by 13.69 % to US$ 524 Mn was due to the increase of all the sub categories of tea sector except Tea Bags. Earnings from Tea packets, Instant Tea and Green Tea increased by 23.10 %, 66.21 %, 40.83% in the period of Jan-May 2023.
Meanwhile earnings from export of Electrical and Electronic Components (EEC) increased by 11.76 % to US$ 210.70 Mn in the period of January to May 2023 compared to the corresponding period of 2022.
Earnings from export of Switches, Boards & Panels and Other Electrical & Electronic Products increased by 21.06 %, and 15.82 % respectively.
Further, export earnings from Seafood increased by 8.23 % to US$ 114.47 Mn during the period of January to May 2023 compared to year 2022 due to the good performance in all the sub categories; Frozen Fish (6.18 %) and Fresh fish (10.51 %).
The value of ICT exports is estimated to increase by 35.84 % to US$ 661.25 Mn in the first five months of 2023 compared to the corresponding period of 2022. In addition, Construction and Financial services exports are estimated to increase by 12.04 % and 4.95 % respectively in the period of January to May 2023 compared with the corresponding period of 2022.
b) Products & Services with Negative Growth (Decreases)
Earnings from export of Apparel & Textile decreased by 15.66 % to US$ 2,024.68 Mn during the period of January to May 2023 compared to the same period of 2022. Export of Apparel declined by 16.47 % and export of Textiles declined by 6.50 % in January to May 2023.
In addition, export earnings from Rubber & Rubber finished products decreased by 9.27 % to US$ 375.87 Mn in January – May 2023 compared with the same period of 2022 attributed to lower exports of Industrial & Surgical Gloves of Rubber (-24.05 %) and Pneumatic & Retreated Rubber Tyres & Tubes (-1.46 %).
For the period of January to May 2023, export earnings from Coconut & Coconut based products decreased by 19.76 % to US$ 280.85 Mn from the same period last year. Earnings from all the major categories of Coconut based products decreased in the period of January – Mayl 2023 compared with the corresponding period of 2022 due to the poor performance in export of Liquid Coconut Milk (-14.81 %), Coconut cream (-31.49 %), Coconut Milk Powder (-13.95 %), Coconut Oil (-21.45 %) and Desiccated Coconut (-37.95 %), Cocopeat (-20.48 %) and Activated Carbon (-10.63 %).
The value of Transport & Logistics exports is estimated to decrease by 28.23 % to US$ 201.3 Mn in the first five months 2023 compared to corresponding period of 2022.
Table 1 shows the comparison of Merchandise export performance in May 2023 and January to May 2023 compared to corresponding periods of previous year.
Sri Lanka’s Export Performance in Major Markets
Out of top 10 export markets, only the Italy and France markets have shown a positive performance during the month of May 2023 and the period of January to May 2023 compared to May 2022.
Further, UAE market has shown a positive performance during the month of May 2023 compared to the corresponding period of previous year.
Exports to United States of America, Sri Lanka’s single largest export destination, decreased 15.25 % to US$ 225.8 Mn in May 2023 compared to May 2022. Further, exports to United States of America decreased by 16.38 % to US$ 1140.70 Mn in the period of January to May 2023 compared to the same period in 2022.
Table 2 shows the comparison of Merchandise export performance of top 15 export markets in May 2023 and January to May 2023 compared to corresponding periods of previous year.
Exports to FTA Partners
a) May 2023
Exports to Free Trade Agreement (FTA) partners accounted for 6.5 % of total merchandise exports has decreased by 2.64 % to US$ 86.07 Mn in May 2023 compared to May 2022.
Exports to India decreased by 5.34 % while exports to Pakistan increased by 35.14 % in May 2023 compared to May 2022.
Poor performance recorded in India led by decreased exports of Pepper (-12.85 %) and better performance recorded in Pakistan led by increased exports of Beetle leaves.
b) Jan - May 2023
Exports to Free Trade Agreement (FTA) partners accounted for 7.2% of total merchandise exports decreased by 6.48 % to US$ 373.13 Mn during the period of January to May 2023 compared with the corresponding period of previous year.
Exports to India and Pakistan decreased by 5.33 % and 18.86 % respectively during the period of January to May 2023 when compared with the corresponding period of 2022.
Decreased exports to India led by poor export performance of Pepper (-41.74 %) and decreased exports to Pakistan led by export of Sheet rubber and Desiccated Coconut.
Sri Lanka’s Export Performance in Regions
Table 3 shows the comparison of region wise exports during the month of May 2023 and the period of January to May 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 May 2023 increased by 1.28 % y-o-y to US$ 236.98 Mn. However, exports to the European Union (EU) decreased by 9.98 % y-o-y to US$ 1,072.06 Mn during the period of January to May 2023 compared to the corresponding period of previous year.
During the period of January to May 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$ 244.41 Mn (decreased by 19.48 %), Italy US$ 259.19 Mn (increased by 6.29 %), Netherlands US$ 137.45 Mn (decreased by 14.93 %), Belgium US$ 91.51 Mn (decreased by 25.03 %) and France US$ 104.51 Mn. (increased by 0.80 %).
Export of Services
The estimated value of services exports for the period of January to May 2023 was US$ 904.58 Million, increasing 12.07 % 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 - 26.06.2023
