Sri Lanka has a trade deficit because domestic economic players get money abroad through means other than merchandise exports, including remittances (exports of labour), foreign borrowing (exports of debt), tourism services and foreign investments.
But last year imports were driven to unsustainable levels as the Central Bank sterilized foreign exchange sales accommodating a spike in credit demand with printed money driving credit and imports to increasingly higher levels.
Tea exports were down a marginal 2.8 percent to 101.0 million US dollars, rubber products fell 19.8 percent to 62.8 million US dollars, food beverages and tobacco was down 40 percent to 12.4 million US dollars.
Imports fell 21.3 percent to 1,507.2 billion rupees, shrinking the trade deficit 24.0 percent to 780.4 million US dollars.
Consumer goods fell 14 percent to 246 million US dollars, intermediate goods fell 25.3 percent to 819.6 million US dollars.
Fuel imports fell 47.6 percent to 269.7 million US dollars amid better rainfall, which reduced thermal power production.
Investment goods imports also fell 15.9 percent to 440.2 million US dollars.
The trade deficit fell 24 percent to 780.4 million US dollars.