The worker remittances to Sri Lanka fell in February as the receipts in the first two months from export of labour languished amid the country facing an uphill task of containing an ever expanding trade deficit and a mounting foreign debt load.
According to the latest data seen by Mirror Business, the receipts from worker remittances fell 3.1 percent year-on-year to US $ 579.5 million but the cumulative receipts for the first two months rose by 3.2 percent to US $ 1,309 million from the same period last year.
The receipts from workers abroad – mainly as domestic aids and semi-skilled workers – amount to the largest single source of foreign income earner for the country.
In 2017, close to two million Sri Lankans working abroad sent back US $ 7.2 billion in remittances, a decline of 1.1 percent.
The remittance income to Sri Lanka weakened during the last couple of years due to the tightening of budgets by Gulf States as the oil prices fell from their peaks in 2014, albeit some recovery seen in recent times.
Meanwhile, tourist earnings – the second largest source of foreign income – were recorded at US $ 437 million in February. Tourist arrivals rose by 19.3 percent year-on-year to 235,618.
Meanwhile, for the two months, the tourist earnings were estimated at US $ 880.1 million, an increase of 13.8 percent over the same period last year.
In 2017, earnings from tourism stood at US $ 3.9 billion.
The remittance income, tourist earnings and earnings from IT/BPM help absorb the hefty deficit in the trade account of the balance of payment.
In January, Sri Lanka reported a trade deficit of US $ 1,049 million, up from US $ 934 million in the same month last year.
In 2017, Sri Lanka recorded a trade deficit of US $ 9,619 million, compared to US $ 8,873 million in 2016, due to the increase in imports over the increase in exports.