|SLs top 5 forex earners netted in $ 5.3b last year
By Paneetha Ameresekere
Sri Lankas top five foreign exchange (forex) earners last year were Textiles and Garments, Private or Overseas Remittances, Tea, Tourism and earnings from the export of Machinery and Equipment, which brought in a total of US$ 5,338 million into the country in 2000, the Central Banks 2000 Annual Report said.
The countrys total export earnings, including earnings from foreign remittances last year were US$ 6,682 million. Earnings from the export of Textiles and Garments topped the list with US$ 2,982 million in 2000.
It was followed by Overseas Remittances (US$ 1,160 million), Tea (US$ 700 million), Tourism (US$ 252 million) and Machinery and Equipment (US$ 244 million).
The countrys top five foreign exchange earners in 1999 were virtually these same five sectors, with the addition of Leather, Travel Goods and Footwear, which tied for the fifth slot along with Machinery and Equipment.
In 1999, Textiles and Garments fetched US$ 2,425 million, Overseas Remittances (US$ 1,056 million), Tea (US$ 621 million), Tourism (US$ 274 million) and Machinery and Equipment and Leather, Travel Goods and Footwear (US$ 201 million each).
Earnings from the export of Leather, Travel Goods and Footwear, slipped into eighth position last year, with earnings declining to US$ 176 million. It was overtaken by Other Industrial exports and Diamond and Jewellery, whose earnings increased from US$ 184 million to US$ 197 million and US$ 171 million to US$ 192 million respectively, last year.
The Report further said that Textiles and Garments which became Sri Lankas largest single item of exports in 1986, continued to maintain its dominant position, increasing its share from 2% in 1977 to 28% in 1986 and 54% in 2000.
Although earnings from the Textiles and Garments sector were high, Tea remained the countrys largest net foreign exchange earner until 1991. However, the former came to this lead position in 1992 and continued to be in that position thereafter.
Private or overseas remittances increased from US$ 1,056 million to US$ 1,160 million, with the Middle-East being the largest contributor with US$ 730 million, the Bank said.
Foreign employment placements registered with the Sri Lanka Bureau of Foreign Employment (SLBFE) declined to around 166,000 in 2000, compared with around 178,000 in 1999, recording a decrease of around 12,000.
This decline was in contrast to the increase of about 18,000 in 1999. According to the SLBFE, the decline in foreign employment placements was probably due to two Ramazan periods taking place in 2000. Demand for migrant workers during the Ramazan period declines due to a lower level of activity in the Middle-Eastern countries during this period.
Tea prices continued to improve after December 1999, following the combined effect of production shortfalls in major producing countries such as India and Kenya and increased demand from the Commonwealth of Independent States (CIS) and Middle Eastern countries.
Prices increased rapidly during the first four months of 2000, but decelerated thereafter, with increased world tea production. However, export prices of tea remained higher than in 1999 throughout the year, benefiting from strong demand.
The average price increased from US$ 2.30 per kilo in 1999 to US$ 2.43 per kg in 2000. The volume of tea exports increased by 7% to 288.2 million kg, keeping pace with the highest reported production of 305.8 million kg in 2000, which was 8% higher than in 1999.
The Report further said that despite strong economic growth in countries which are major sources of tourists to Sri Lanka, frequent and more flights between Colombo and major sources of tourist traffic to the country and promotion campaigns carried out by the government and the private sector, the tourism sector suffered a setback last year.
Tourist arrivals continued to slowdown throughout the year, except in February 2000. Tourist arrivals at 400,414 in 2000 were 8% lower than in 1999. Reflecting the impact of lower tourist arrivals, gross earnings from tourism declined from US$ 274 million in 1999 to US$ 252 million in 2000.
Direct employment increased by 4% to 37,943, while indirect employment increased from 51,184 in 1999 to 53,120 in 2000. Direct employment is employment in hotels and restaurants, travel agencies, airlines providing recreational facilities, tourist shops and the Tourist Board, the Report said. Indirect employment is generated by domestic producers and suppliers of inputs, manufacturers and suppliers of handicraft and others.
Exports of machinery, mechanical and electrical equipment grew by 21% as against the growth of 10% in 1999. Major export items in 2000 were parts and accessories of data processing machines, printed circuits, electrical transformers, machine tools, screws and bolts and nuts. This category accounted for 6% of total industrial exports.
Export earnings from travel goods, footwear and other leather products declined by 12% in 2000. However, export earnings from hand bags, travel cases with outer surface of leather and textiles grew.
Even though exports of travel goods declined, the industry showed an expansion towards the end of 2000. Export earnings from footwear declined by 18% with a marked drop in exports of special kinds.
Earnings from slippers and canvas shoes increased in 2000. Exports of other articles of leather, although small in magnitude, increased significantly in 2000. Other manufactured exports such as chemical products, wooden toys, articles of copper, quartz, brooms and brushes, showed a healthy growth to meet increased demand from Western countries.
The jewellery market, which suffered a setback due to the East Asian crisis, showed steady recovery, reporting a 25% increase in 2000. The Export Development Board took initiatives to improve the skills of craftsmen, the quality of jewellery manufactured in craft villages and the skills for jewellery designing through workshops, seminars and consultations.
Assistance was provided to new and existing exporters to enter the international market, while opportunities were given to some exporters to participate in local and international trade fairs and exhibitions. USA continued to be the largest buyer of - jewellery, followed by Germany, Japan, Switzerland and UK. Diamond exports increased by 12% in 2000, with exports to Belgium, Israel, Vietnam, USA and Japan.
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