March merchandise exports plunge record 42%

• 1Q merchandise exports down 17% to US $ 2.6bn
• Services exports in 1Q down 24% to US $ 805mn
• Total exports in 1Q down to US $ 3.4bn, from US $ 4.2bn a year ago

Sri Lanka’s merchandise export earnings in March plunged a record 42 percent year-on-year (YoY) to US $ 646 million, with the COVID-19 pandemic spreading across the country’s key export markets coupled with disruptions to supply chains, according to the Export Development Board (EDB). 

The slump in the March merchandise export earnings paved the way to a 17.31 percent YoY slowdown in the merchandise export earnings to US $ 2.6 billion in the first quarter of the year. 

Interestingly, the service export earnings, which consist of ICT/BPM, construction, financial services, logistics and wellness tourism sectors, showed a steeper decline of 24.1 percent YoY to US $ 805 million in the first quarter of the year.   

Consequently, the overall export earnings slowed by 19 percent YoY in the first quarter reaching US $3.4 billion, compared to US $4.2 billion in the corresponding period of 
last year. However, the EDB emphasised that Sri Lanka achieved 32 percent of the annual revised target of US $ 10.75 billion set for the year.

In March, the apparel exports, the country’s largest export revenue generator, fell 41.23 percent YoY to US $ 312.1 million.

The tea export revenue in March halved by 50.33 percent YoY to US $ 62.5 million while gem and jewellery exports generated 77.5 percent less earnings, compared to March last year.

The export earnings from engineering products, spices, essential oils and fruits and vegetables, recorded a decline of over 40 percent in March while earnings from rubber products and coconut products declined by over 35 percent YoY in the month. 

However, the petroleum product exports grew by 16 percent YoY in March and by 32.4 percent in the first quarter, defying the overall declining trend. 

As per the EDB analysis, coconut milk powder, defatted coconut, certain coconut kernel products, coconut shell charcoal, essential oils, oleoresins, ginger, lemons, melons and papayas, onions, sweat potatoes, processed food, rice, green gram, lentils, organic chemicals, electrical transformers, boat building and several other, posted a positive growth during March 2020, compared to March 2019.

Further, the EDB noted that products such as rubber industrial and surgical gloves, copra, coconut cream, coconut water, mattress fibre, essential oils, made-up textile articles, sugar, sugar confectionery and bakery products, processed vegetables, fruits and juices, alcoholic beverages, MDF and fibre boards, soap, washing preparations and waxes, only indicated a marginal decline in export earnings in the first quarter. “Even though there is a decline in exports during the month of March 2020, such a decline is expected due to the global economic and trading environment. 

However, the EDB is taking every effort to assist the exporters to resume operations and we firmly believe that exports will be back on track in the near future,” EDB Chairman Prabhash Subasinghe said.