Sri Lanka’s merchandise exports decreased by 14.6 % to US$ 898.0 Million in October 2023 compared to October 2022 as per the provisional data released by the Sri Lanka Customs. Also, it is a 13.13 % decrease when compared to the value recorded in September 2023.
The decline in merchandise exports is due to decreased demand for export products, particularly in sectors such as Apparel & Textiles, Rubber & Rubber-based products, and Coconut & Coconut-based products.
The Figure 1 shows the comparison of Monthly Merchandise Export Performance 2020 – Oct 2023.
Sources: Central Bank of Sri Lanka, Sri Lanka Customs
Major Exports in October 2023
a) Products & Services with Positive Growth (Increases)
Export earnings from Food & Beverages have increased by 20.77 % y-o-y to US$ 36.86 Million in October 2023, with the strong performance in exports of Processed Food (29.49 %).
Export earnings from Seafood increased by 3.73 % to US$ 20.29 Mn in October 2023 compared to October 2022. This increase was mainly due to the strong performance in export of Frozen fish (5.21 %) and Fresh fish (13.78 %).
Moreover, export earnings from Ornamental fish increased by 35.71 % to US$ 2.47 Mn in October 2023 compared to October 2022.
Furthermore, the estimated value of ICT exports is expected to increase by 96 % to US$ 166.01 Mn in October 2023 when compared to October 2022. Also, the value of Transport & Logistics services exports is expected to increase by 54.73 % in October 2023 compared to the corresponding period in the previous year.
b) Products & Services with Negative Growth (Decreases)
Export earnings from Apparel & Textile have decreased by 20.05 % y-o-y to US$ 353.3 Million in October 2023 compared to October 2022.
Export earnings from tea which made up 12% of merchandise exports, decreased by 12.02 % y-o-y to US$ 95.63 Mn in October 2023 compared to October 2022. This decline is mainly due to the negative performance in the export of Bulk tea, which decreased by 18.81% to reach US$ 43.35 Mn in October 2023.
In addition, Export earnings from Rubber and Rubber Finished products have decreased by 7.66 % y-o-y to US$ 79.7 Mn in October 2023, with the strong performance in exports of Industrial & Surgical Gloves of Rubber (19.32 %).
On monthly analysis, export earnings of Coconut based products decreased by 17.57 % in October 2023 compared to October 2022. Moreover, export earnings of Coconut fiber products and Coconut shell products decreased by 42.67 % and 25.35 % respectively in October 2023 compared to October 2022.
Earnings from Activated Carbon, which is categorized under the Coconut shell products decreased by 25.49 % to US$ 11.11 Mn in October 2023 compared to October 2022.
In addition, export earnings from the Electrical & Electronics Components decreased by 18.74 % y-o-y to US$ 37.59 Mn in October 2023 with poor performance in exports of Electrical Transformers (-48.02 %).
Export earnings from Spices and Essential Oils decreased by 10.14 % to US$ 32.7 Mn in the month of October 2023 compared to month of October 2022. This decrease was primarily driven by a significant decrease in the export of Cinnamon 12.02 %.
Exports during the period of January – October 2023
Cumulative merchandise exports during the period of January to October 2023, decreased by 10.54 % to US$ 9,879.8 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, Electronics & Electronic Components and Food & Beverages increased by 3.83 %, 7.62 %, 1.34 %, 3.39 % and 2.71% respectively during the period of January – October 2023 compared with the corresponding period of 2022.
Earnings from export of Tea increased y-o-y by 3.83 % to US$ 1,085.94 Mn in the period of January to October 2023. This increase was mainly due to the strong performance in export of Tea packets (12.27%).
In addition, export earnings from Spices and Essential Oils increased y-o-y by 7.62 % to US$ 335.39 Mn in the period of January to October 2023. This increase was due to the strong performance in exports of Pepper (21.12 %), Cloves (205.81 %) and Nutmeg & Mace (22.38 %).
Meanwhile earnings from export of Electrical and Electronic Components (EEC) increased by 3.39 % to US$ 414.26 Mn in the period of January to October 2023 compared to the corresponding period of 2022. Under the EEC sector, earnings from export of Printed Circuits, Boilers/ Piston Engines/ Pumps & Vacuum Pumps and Other Electrical & Electronic Products increased by 50.1 %, 678.79% and 3.43 % respectively in the period of January to October 2023 compared to the corresponding period of 2022.
The value of ICT exports is estimated to increase by 43.59 % to US$ 1,353.99 Mn in the first ten months of 2023 compared to the corresponding period of 2022. In addition, Construction, Financial and Transport & Logistics services exports are estimated to increase by 788.1 %, 70.51 % and 99.15 % respectively in the period of January to October 2023 compared with the corresponding period of 2022.
b) Products & Services with Negative Growth (Decreases)
Earnings from export of Apparel & Textile decreased by 19.46 % to US$ 4,030.68 Mn during the period of January to October 2023 compared to the same period of 2022. Further, earnings from export of Apparel declined by 19.46 % and export of Textiles declined by 5.13 % in January to October 2023.
In addition, export earnings from Rubber & Rubber finished products decreased by 11.71 % to US$ 771.86 Mn in January – October 2023 compared with the same period of 2022 attributed to lower exports of Industrial & Surgical Gloves of Rubber (-25.59%) and Pneumatic & Retreated Rubber Tyres & Tubes (-4.99 %).
For the period of January to October 2023, export earnings from Coconut & Coconut based products decreased by 16.92 % to US$ 590.69 Mn from the same period last year. Earnings from all the major categories of Coconut based products decreased in the period of January – October 2023 compared with the corresponding period of 2022 due to the poor performance in export of Coconut Oil (-16.28 %), Desiccated Coconut (-26.09 %), Coconut Milk Powder (-7.13 %), Coconut Cream (-9.12 %), Liquid Coconut Milk (-7.99 %), Cocopeat (-17.61 %) and Activated Carbon (-18.98 %).
Further, export earnings from Seafood decreased by 5.18 % to US$ 213.24 Mn during the period of January to October 2023 compared to year 2022 due to the poor performance in Frozen Fish (-4.36 %), Shrimps (-31.77 %) and Crabs (-22.83 %).
Table 1 shows the comparison of Merchandise export performance in October 2023 and January to October 2023 compared to corresponding periods of previous year.
Sri Lanka’s Export Performance in Major Markets
Among the top 10 export markets, Italy has shown a strong performance in both the month of October 2023 and the period of January to October 2023 when compared to the corresponding periods in the previous year. Furthermore, UAE and France have shown significant performance during the period of January to October 2023 compared to the corresponding period in the previous year.
Exports to United States of America, Sri Lanka’s single largest export destination, decreased 13.84 % to US$ 206.77 Mn in October 2023 compared to October 2022. Further, exports to United States of America decreased by 19.18 % to US$ 2,281.57 Mn in the period of January to October 2023 compared to the same period in 2022.
Table 2 shows the comparison of Merchandise export performance of top 15 export markets in October 2023 and January to October 2023 compared to corresponding periods of previous year.
Exports to FTA Partners
a) October 2023
In October 2023, exports to Free Trade Agreement (FTA) partners constituted 6.5% of the total merchandise exports, experiencing a notable 22.27% decrease to reach US$ 71.22 Mn, compared to October 2022. Specifically, both exports to India and Pakistan recorded decreases of 22.18% and 23.30%, respectively, during the month of October 2023 compared to October 2022.
The negative performance of India was driven by lower exports of petroleum oil (-73.51%) and animal feed (-24.04%), while Pakistan's negative performance was led by decreased exports of betel leaves.
b) January - October 2023
Exports to Free Trade Agreement (FTA) partners accounted for 7.2% of total merchandise exports decreased by 0.77 % to US$ 786.09 Mn during the period of January to October 2023 compared with the corresponding period of previous year.
Both exports to India and Pakistan decreased by 0.69% and 1.58% respectively during the period of January to October 2023 when compared with the corresponding period of 2022.
The negative export performance of India was driven by lower export of Animal feed (4.47 %), while Pakistan's negative performance was led by decreased export of Sheet rubber and Other article of stones.
Sri Lanka’s Export Performance in Regions
Table 3 shows the comparison of region wise exports during the month of October 2023 and the period of January to October 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 October 2023 decreased by 23.52 % y-o-y to US$ 213.18 Mn. Further, exports to the European Union (EU) decreased by 12.19 % y-o-y to US$ 2,257.58 Mn during the period of January to October 2023 compared to the corresponding period of previous year.
During the period of January to October 2023, breakdown of exports to the top five EU markets which accounted for 78 % of Sri Lanka’s total exports to the EU were; Italy US$ 571.48 Mn (increased by 6.65 %), Germany US$ 484.28 Mn (decreased by 23.59 %), Netherlands US$ 270.92 Mn (decreased by 23.31 %), France US$ 266.99 Mn. (increased by 19.47 %) and Belgium US$ 186.89 Mn (decreased by 29.86 %).
Export of Services
The estimated value of services exports for the period of January to October 2023 was US$ 2,606.34 Mn, increasing 67.2 % 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 - 05.12.2023
