The Central Bank of Sri Lanka today issued the External Performance Review up to May 2014. In this review the performance highlights with the rating the separate establishments on their achievements and milestones achieved in this period.

The trade deficit continued to improve in May 2014, strengthening the performance in the external sector. Earnings from exports increased, while expenditure on imports reduced driven mainly by the reduction in fuel imports. This outcome, together with higher inflows on account of workers’ remittances, increased tourist earnings and continued inflows to the financial account resulted in a healthy surplus in the Balance of Payments (BOP) during the first five months of 2014, compared to the corresponding period of 2013.

In this report it states that On a year-on-year basis, earnings from exports in May 2014 have increased by 11.1 per cent to US dollars 882 million, while expenditure on imports declined by 17.6 per cent to US dollars 1,275 million.

Accordingly, the trade deficit contracted for the eight consecutive month in May 2014, by 47.9 per cent to US dollars 393 million.

However in the import sector, the Expenditure on imports declined by 17.6 per cent to US dollars 1,275 million in May 2014, due to the significant decline in expenditure on imports of intermediate and investment goods. Expenditure on imports of intermediate goods declined by 21.0 per cent, year-on-year, to US dollars 717 million in May 2014 mainly due to the  significant declines in importation of crude oil, diamonds and gold. Negligible imports of gold in May contributed to the decline in import of gold, precious stones and metals by 87.0 per cent to US dollars 13.2 million in May2014.