Export earnings top US $ 8.3bn in 1H25

• June merchandise exports up 6.9% YoY, while services exports up nearly 10%
• Services, coconut and tea lead charge
• Apparel and ICT exports hold steady
• US remained Sri Lanka’s top export destination, despite a 0.7% dip in June

Sri Lanka’s export economy packed a punch in the first half of 2025, crossing the US $ 8.3 billion mark for the first time in three years, as a surge in services and agri-based shipments helped offset the sectoral drag.

Exports in the January-June period rose 6.7 percent year-on-year (YoY) to US $ 8.34 billion, the provisional data from the Export Development Board showed, showing signs of a recovery driven by value-added exports and stronger regional demand.

The momentum held up in June, with total exports climbing 8.7 percent from a year earlier to US $ 1.46 billion. Merchandise exports rose 6.9 percent to US $ 1.15 billion, while services exports, now a key growth pillar, were estimated at US $ 309.6 million, up nearly 10 percent.

Export earnings from services continued their upward momentum, with ICT/BPM exports estimated to have grown 34.1 percent YoY in June to US $ 147.2 million. Logistics and transport services followed closely with a 12.4 percent rise to US $ 148.2 million.

For the January-June period, ICT/BPM exports rose 11 percent to US $ 764.5 million, while logistics services climbed 17.9 percent to US $ 974.3 million, together accounting for over 94 percent of total services exports.

Agricultural exports, particularly the coconut-based products and tea, outperformed the expectations in both June and the first half.

Coconut product exports surged 59.6 percent YoY in June, led by sharp increases in kernel-based items such as coconut oil (+97.1 percent), milk powder (+83 percent), cream (+131.3 percent) and liquid milk (+96.8 percent). Fiber and shell-based products also posted a double-digit growth.

In the first half, coconut exports totalled US $ 536.7 million, up 32.4 percent from the same period last year, reflecting a stronger global demand and value addition.

Tea earnings reached US $ 743.1 million in the first half, up 8.2 percent, with June alone contributing US $ 133 million — a 9.2 percent increase from last year. Higher sales of tea packets (+25.5 percent) and instant tea (+49.7 percent) supported the gains, though exports to Iran declined sharply.

Notably, tea shipments to Iraq and Libya rose 83 percent and 172 percent, respectively.

Apparel and textiles, Sri Lanka’s largest single merchandise export, showed steady performance. Earnings reached US $ 2.6 billion in the first half, up 8.2 percent from 2024. June earnings rose 3.7 percent YoY to US $ 463.1 million, supported by the shipments to the US and UK, which grew by 4.4 percent and 6.8 percent, respectively.

Food and beverage exports also gained ground, rising 17.2 percent in the first half to US $ 278.9 million. Processed food was the main driver, recording a 37.2 percent increase.

Estimated exports of diamonds, gems and jewellery rose 27 percent YoY in June to US $ 37.9 million. Despite the broader uptick, a few segments continued to underperform.

Seafood exports fell 19 percent in the first half to US $ 104.2 million, dragged down by the declining shipments of fresh fish (-41.8 percent) and shrimp (-60.9 percent). In June alone, seafood earnings dropped 23.8 percent to US $ 15.7 million.

Rubber and rubber-based product exports declined 6.2 percent in the first half, with a notable drop in pneumatic tyres and tubes. Sheet rubber exports plummeted 66.7 percent in June.

Electrical and electronic components saw a modest 1.7 percent drop in the first half to US $ 201.5 million, with printed circuits falling 64.1 percent and insulated cables down 11.2 percent. The US remained Sri Lanka’s top export destination, despite a 0.7 percent dip in June. The first-half exports to the US rose 4.6 percent to US $ 1.43 billion. India overtook the UK as the second-largest market. Exports to India rose 26.5 percent in the first half to US $ 505.6 million, boosted by petroleum oil and animal feed. The UK-bound exports reached US $ 483.9 million, up 6.9 percent. The European Union accounted for 24 percent of Sri Lanka’s merchandise exports and saw strong gains. Exports to the bloc rose 11.5 percent in the first half and 23.8 percent in June, with Germany, Italy, the Netherlands and France driving the increase.

The shipments to the African countries grew 35.5 percent in the first six months and surged 58.6 percent in June, while the ASEAN-bound exports jumped 22.6 percent over the first half and 30.8 percent in June. In contrast, exports to the Commonwealth of Independent States fell 7.7 percent in the first half and 26.5 percent in June.