Worker remittances finance chunk of trade deficit

The bank said export earnings grew by 12.9 percent during the first half of 2007 underpinned by the highest monthly value in 2007, US$675 million in June

Remittances from migrant workers, the second highest foreign exchange earners to the country, have financed 80 percent of Sri Lanka’s trade deficit in the first half of the year, the Central Bank said.

It said remittances rose by about 18 percent to US$1.3 billion during this period. The reduction in the trade deficit and worker remittances would have a favourable impact on current account balance for the first half of 2007.

The bank said export earnings grew by 12.9 percent during the first half of 2007 underpinned by the highest monthly value in 2007, US$675 million in June.

Imports declined by 11.5 per cent in June due to a decline in imports of petroleum, fertilizer, textile material, and other consumer goods.

“The external sector is expected to further improve with increased inflows to the government as well as to the private sector, supported by the recent upward revision of Sri Lanka’s credit rating outlook to ‘Stable’ from ‘Negative’ by Standard & Poor’s, on the basis of the improved macroeconomic performance,” the bank statement said.