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6 percent to 1,432.8 million US dollars from a year earlier, official data showed. The trade gap shrank 10 percent to 541.6 million US dollars from a year earlier. Exports The Central Bank said the subdued performance in agri and industrial exports, owing to lower international commodity prices and lower domestic supply, mainly contributed to exports decline. Export earnings from tea dropped by 14.8 percent to 108 million US dollars in July 2016, due to lower demand, particularly from Russia and Middle-Eastern countries, although tea exports to Iran increased in comparison to July 2015. The Central Bank said Earnings from export of spices declined significantly by 31.8 percent mainly due to the poor performance of pepper as a result of low domestic supply. Export earnings from petroleum products decreased by 24.7 percent during the month owing to the combined effect of lower bunkering quantities and average bunkering prices. Earnings from sea food exports to the EU grew by 19.9 percent mainly as a result of the removal of the fish ban imposed by the EU on Sri Lanka, with effect from end June 2016. Earnings from textiles and garments exports which account for around 48 percent of total export earnings grew by 3.0 percent to 426 million US dollars, due to higher garment exports to the EU and non-traditional markets such as Canada, China, Australia and the UAE. On a cumulative basis, earnings from exports during the first seven months of 2016 contracted by 5.6 percent to 5,999 million US dollars mainly due to reductions in export earnings from transport equipment, petroleum products, tea and spices.
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The leading markets for merchandise exports of Sri Lanka during the first seven months of 2016 were the USA, UK, Germany, India and Italy accounting for about 53 percent of total exports. Imports The Central Bank said a significant decline in expenditure on vehicle imports, followed by fuel and wheat imports, contributed largely to this reduction. Reflecting the impact of policy measures adopted by the government to curtail vehicle imports, the expenditure on personal motor vehicles declined by 63.7 percent. Importation of motor cars, hybrid electric vehicles, motor cycles, buses, agricultural tractors and auto-trishaws declined significantly during the month. Import expenditure on fuel declined by 18.6 percent to 142 million US dollars during the month mainly due to the drop in average import prices of crude oil and coal together with the significant reduction in import volumes of refined petroleum products. In line with the drop in oil prices in the international market, the average import price of crude oil declined to 46.10 US dollars per barrel in July 2016 from 50.95 US dollars per barrel in the previous month and 60.49 US dollars per barrel in July 2015. Workers’ remittances declined by 4.4 per cent to 572.8 million US dollars in July 2016 from 599.3 million US dollars in July 2015. BOP Position During the first seven months of 2016, the overall BOP is estimated to have recorded a surplus of 356.0 million US dollars, compared to a deficit of 1,229.6 million US dollars recorded during the corresponding period of 2015.