Sri Lanka’s economy is expected to grow moderately by 2.2% in 2024, indicating some stabilization following the severe downturn in 2022, according to the World Bank's latest bi-annual update. However, the country continues to grapple with high poverty levels, income inequality, and labor market challenges.
In the first half of 2024, the ratio of export prices to import prices improved slightly by 0.9% compared to the same period in 2023. Despite this, the overall terms of trade deteriorated by 2.5% in 2024, as export prices fell more sharply than import prices. The export volume index rose by 10.8%, while the unit value index dropped by 3.4%, indicating that the increase in export earnings for 2024 compared to 2023 was driven by higher export volumes. Similarly, the import volume index increased by 6.5%, while the unit value index declined by 0.8%, suggesting that the rise in import expenditure in June 2024 compared to 2023 was also due to higher volumes.
- Performance of Merchandise Exports in 2023 September
Overall Exports: Earnings from merchandise exports declined by 10 per cent to US dollars 972 million in September 2023, over the corresponding month in 2022 as well as compared to US dollars 1,119 million. we will see the 2024 Export market how to work
- Export :-
- Industrial Exports:
As per the past year Earnings from the exports of industrial goods declined in September, with a significant share of the decline being contributed by garments. Accordingly, exports of garments to most of the major markets (the USA, the EU, and the UK) recorded declines. Further, declines were recorded in the export of gems, diamonds and jewelry; machinery and mechanical appliances(mainly, electronic equipment); and chemical products (mainly, activated carbon), among others
- Agricultural Exports:
Earnings from the exports of agricultural goods will improved in September 2024, compared to a year ago, mainly due to the increase in earnings from seafood (primarily, fresh fish), coconut related products and tea. An increase of earnings from tea resulted from the higher export volumes although the unit price of tea exports in September 2023 was lower than a year earlier. Meanwhile, there was a decline in export earnings from spices (mainly, cinnamon), natural rubber and unmanufactured tobacco.
- Mineral Exports:
Earnings can expect from mineral exports declined in September 2024, compared to September
2023, mainly due to the decline in export earnings from titanium ores.
2. Imports :-
- Consumer Goods:
- Investment Goods:
Import expenditure on investment goods will increase in September 2024, compared to September 2023, led by the increase in imports of machinery and equipment (primarily, machinery and equipment parts and engineering equipment). Import expenditure on building material also increased, mainly owing to high imports of iron and steel (primarily, iron bars and rods), while expenditure on importation of transport equipment increased mainly due to high imports of railway track construction material.
- Intermediate Goods:
Expenditure on the importation of intermediate goods will increase marginally in September 2024, compared to a year ago, mainly driven by the higher import volumes of wheat, fuel, fertilizer (mainly, urea), and base metals (mainly, Iron and steel). Despite non-importation of crude oil in September 2023, expenditure on fuel increased compared to September 2022, with higher imports of refined petroleum and the resumption of coal imports. However, the importation of textiles and textile articles (primarily, fabrics); plastics and articles thereof; rubber and articles thereof; chemical products; and diamonds and precious stones and metals recorded notable declines, among others, in September 2023, compared to September 2022.
3. Logistics Hub :-
For the last ten years, the Port of Colombo reported a steady growth of 4.5% in container traffic and transshipment volume accounted for more than 75% of the total container quantity.
There are three types of trans-shipment methods practiced in Sri Lanka:
1.Hub-and-spoke (hub/feeder) –between deep-sea and feeder
2. Interlining/intersection –between deep-sea and deep-sea along shipping routes
3. Relay –between deep-sea and large deep-sea as an interface between shipping routes along with the same maritime range but servicing different ports of call.
Sri Lanka is the main transshipment hub for the Indian subcontinent, mainly to Indian Peninsular and other South Asian Countries, mainly to take the best advantage out of the free trade agreements between South Asian countries (SAFTA), Sri Lanka and Singapore, and the country’s participation in the Generalized System of Preferences (GSP).
Colombo Port focuses on container trans-shipment largely for the textile industry while Magampura International Port in Hambantota provides services mainly for vehicle transshipment (roll-on/roll-off operations). Japanese, Korean and Indian carmakers use this port for trans-shipping vehicles built in India, Thailand, Japan and China to markets in Africa, the Middle East, Europe and the Americas.
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