Balance of payments surplus grows to $ 2.15 b; gross reserves to $ 9.2 b

Thursday, 9 October 2014 00:14 - - {{hitsCtrl.values.hits}}

Aided by robust inflows, the country continues to enjoy a strong Balance of Payment (BOP) surplus as well as healthy gross reserves, according to the latest Central Bank data. During the period from January to August 2014, the BOP is estimated to have recorded a surplus of $ 2,150 million compared to the deficit of $ 66 million in the corresponding period of 2013.

By end August 2014, Sri Lanka’s gross official reserves amounted to $9.2 billion, while total foreign assets, which include foreign assets of the banking sector, amounted to $10.7 billion. In terms of months of imports, gross official reserves were equivalent to 5.9 months of imports at end August 2014, while total foreign assets were equivalent to 6.9 months of imports. “It is noteworthy that a healthy level of reserves was maintained, despite outflows on account of foreign debt service payments of $1,694 million and IMF-SBA payments of $517 million,” the Central Bank said. In addition, the Central Bank also now has access to CNY 10 billion, equivalent to $1.6 billion, as a result of the bilateral Currency Swap Agreement entered into with the People’s Bank of China. This swap facility, which is of a tenor of three years and renewable, is expected to further strengthen the external stability of the Sri Lankan economy. Long-term loans obtained by the Government during the year to end August 2014 amounted to $1,173 million, compared to $1,156 million during the corresponding period in 2013. Net inflows to the Government securities market from January to end August 2014 amounted to $ 218 million, which comprised net inflows to Treasury bills and Treasury bonds amounting to $37 million and $181 million, respectively. Central Bank data also showed that foreign direct investments in the first eight months have grown by 55% top $ 850 million. Foreign investments in the Colombo Stock Exchange (CSE) recorded a net outflow of $28 million in August 2014 compared to the net inflow of $18 million recorded in the corresponding period in 2013. However, on a cumulative basis, foreign investments in the CSE up to end August 2014 recorded a net inflow of $56.7 million. Meanwhile, inflows to Licensed Commercial Banks (LCBs) and Licensed Specialised Banks (LSBs) during the first eight months in 2014 amounted to $200 million.

Workers’ remittances top $ 4.5 b

Workers’ remittances have increased by 10% in the first eight months of this year to $ 4.515 billion in comparison to the corresponding period of 2013, the Central Bank said on Tuesday. In August, inflows were subdued with just 1.5% growth to $ 548 million as against a year earlier. In July remittances grew sharply by 15% to $ 606.7 million as against July 2013. Last year workers’ remittances hit a record high of $ 6.4 billion (around 10% of GDP) up from $ 6 billion in 2012 and $ 1.97 billion in 2005.