Trade deficit continues its downward trend

COLOMBO (News 1st) - Sri Lanka's external sector has strengthened further in June this year, with a marked contraction in the trade deficit as imports declined and exports increased. In its External Sector Performance Review for the month, the Central Bank said the trade deficit narrowed to US dollars 316 million, the lowest since October 2010. This considerable reduction was due to the decline in import expenditure by 23.1% and an increase in export earnings by 5.8 %. The main contributors for the reduction in imports were identified as the 39.4% decrease in the import of consumer goods, 67.2% decrease in personal vehicles, 17% decrease in fuel, and 82.1% in transport equipment. Vehicle registrations also declined in June this year. The CBSL release notes that the growth in exports was driven by the improved performance in textiles and garments and rubber product exports.