Sri Lanka July trade gap widens, tea boosts export earnings

Sept 17, 2008 (LBO) – Sri Lanka’s export earnings in July 2008 went up 24.1 percent to a record 849 million US dollars from a year ago, boosted by agricultural exports, especially tea, the central bank said Wednesday.

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The trade deficit reached 414 million dollars in July 2008 compared to the deficit of 146 million dollars in July 2007, it said in its monthly statement on the island’s external trade performance.

Spending on imports increased by 52.0 percent in July 2008 to 1,262 million dollars from a year ago.

The strongest export growth in July 2008, which followed a marginal decline the month before, came from agriculture which grew by 54.7 percent, bolstered by a 70.0 percent share of tea, as a result of both improved prices and higher volumes.

“Prices of tea, which have been on an increasing trend from early 2007, increased further, pushing the average price of tea to 4.17 US dollars per kg in July 2008,” the bank said in a statement.

“Minor agricultural exports also grew at a faster pace relative to other agricultural exports supported by strong performance of vegetabl