Tuesday, 23 July 2013 01:46
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Earnings from tourism up 22% to $484.3 m by May
Worker remittances up by 6% to $2.65 b
$664.3 m into commercial banks
$692 m net inflows to the Government securities market
$108 m into Bourse
Long-term loans obtained by Govt. at $597 m, down from $701 m a year earlier
Gross official reserves at $6.6 b despite $225 m settled under IMF-Stand By Arrangement principal repayment and foreign debt service payments of $575 m
The Central Bank on Friday said the country’s external sector continued to remain stable with increased inflows to the Current Account as well as the Financial Account of the Balance of Payments (BOP).
It said earnings from tourism and current transfers by way of workers’ remittances increased notably, strengthening the Current Account. The Colombo Stock Exchange (CSE) recorded increased foreign investments reflecting improved investor confidence.
Commercial banks and the corporate sector have been able to raise more foreign funds this year, given the stable macroeconomic environment and further relaxation of exchange control regulations. During the first five months of the year, foreign investments in Government securities also recorded an impressive growth in spite of the uncertainties in international financial markets.
Following are key highlights:
Sri Lanka was able to attract 438,653 tourists during the year as of end-May 2013, recording a year-on-year growth of 13.2% in total tourist arrivals. Earnings from tourism expanded at a commendable rate of 34.5% in May 2013 to $ 77 million, from $ 57 million recorded in May 2012. This increase was the result of a significant increase in the number of tourist arrivals in May 2013.
Tourist arrivals increased by 21.8%, year-on-year, to 70,026 in May 2013. On a cumulative basis, earnings from tourism during the first five months of 2013 recorded a growth of 21.9%, to $ 484.3 million, compared to the cumulative earnings of $ 397.1 million received from tourism during the first five months of 2012.
Workers’ remittances increased by 6.6%, year-on-year, to $ 541 million in May 2013 from $ 507 million in May 2012. Accordingly, cumulative inflows of workers’ remittances during the first five months of 2013 amounted to $ 2,650 million, an increase of 6.4% compared to the corresponding period of 2012.
In May 2013, the Colombo Stock Exchange received a net inflow of $ 38.6 million, compared to the net inflow of $ 10.4 million in May 2012. Accordingly, total net inflows during the first five months amounted to $ 108 million. Meanwhile, inflows to commercial banks during the first five months of the year stood at $ 664.3 million.
Foreign investments in Government securities showed an impressive growth, with net inflows to Treasury bills and Treasury bonds in May 2013 amounting to $ 80.1 million, compared to a net inflow of $ 16.4 million in May 2012.
Accordingly, net inflows to the Government securities market in the first five months of 2013 increased by 39.5% to $ 692 million, compared to the net inflow of $ 496 million recorded in the corresponding period of 2012. In the meantime, the government has obtained long-term loans amounting to $ 597 million by end-May 2013, compared to the $ 701 million obtained by way of long-term loans in the first five months in 2012.
By end-May 2013, Sri Lanka’s gross official reserves amounted to $ 6.6 billion. Accordingly, Sri Lanka’s gross official reserves have been at a satisfactory level in spite of outflows in the first five months of 2013, including the IMF-Stand By Arrangement (SBA) principal payment of $ 225.5 million, foreign debt service payments of around $ 575 million and the accumulated valuation losses of $ 312 million, due to the cross currency exchange rate movements and the sharp decline in gold prices.
The total international reserves, which include foreign assets of commercial banks, amounted to $ 8.2 billion. Reflecting the healthy position of international reserves, the import cover of the gross official reserves and total reserves were at 4.3 months and 5.4 months, respectively.
