Sri Lanka’s exports recovered in February amid investor concern that a sovereign-debt crisis in Europe may damp demand for the nation’s tea and rubber.
Overseas sales gained 20 percent to $629 million in February from a year earlier, after falling 3.9 percent in January, the Central Bank of Sri Lanka said in an e-mailed statement today.
“Sri Lanka will be vulnerable to the situation in Europe and the Euro’s decline,” said Saminda Weerasinghe, research manager at Acuity Stockbrokers Pvt. in Colombo. “Our exports could see ups and downs.”
European policy makers unveiled an unprecedented loan package worth almost $1 trillion and a program of bond purchases to stop the debt crisis, whose epicenter is Greece, from threatening to shatter confidence in the euro.
Sri Lanka’s exports could also slow after the European Union said Feb. 15 it will suspend preferential trade benefits due to human rights shortcomings in the island nation’s 26-year civil war, which ended in May last year.
Agricultural shipments gained 56.4 percent to $169.9 million in February, the central bank said. Industrial exports rose 11.1 percent to $452.8 million, while clothing and textile shipments fell 9.7 percent, it said.
Sri Lanka’s trade deficit in February widened to $344.5 million, four times the shortfall a year ago, today’s report showed. Imports gained 60.6 percent to $973.4 million. - Bloomberg