Sounding alarm bells, exports decreased by 8.1% in the first quarter of 2013 from US$ 2.57 million to US$ 2.36 million, with March contributing a 2.8% drop year-on-year.
The latest external performance data by the Central Bank showed yesterday that earnings from exports declined by 2.8% year-on-year in March 2013, as earnings from industrial exports, which account for about three-fourths of total export earnings, declined.
Even though earnings from textiles and garments, which account for more than a half of industrial exports in value terms, recorded a further increase of 5% year-on-year in March 2013, overall industrial numbers for the 1Q showed a drop of 8.7%.
Exports of garments to the USA increased in March too, on a year-on-year basis, following the increase recorded in February, while exports of garments to the European Union declined in March, as in February. Agriculture products also showed a 4.2% decrease in the 1Q sliding from US$ 575 million in 2012 to US$ 551 million in 2013.
The largest drop was recorded by mineral products that reduced 72% in the 1Q.
“Earnings from agricultural exports meanwhile increased by 0.5% year-on-year in March 2013, thus helping buoy export earnings. With respect to agricultural exports, earnings from tea exports increased as export prices of both black tea as well as green tea have increased in 2013, up to March, alongside the decline in export volumes of tea during this period. Amongst other agricultural exports, spices, vegetables, minor agricultural products and sea food have also fetched increased earnings in March 2013,” the release said.
Meanwhile, expenditure on imports declined by 16.8% year-on-year in March 2013. While expenditure on all three major categories of goods imported, viz. consumer goods, intermediate goods and investments goods, declined in March 2013, a decline in expenditure on imports of crude oil and refined petroleum products led the decline in import expenditure.
Imports for the 1Q decreased 16% with the sharpest decrease of 53.5% tallied up by transport equipment. Consumer goods reduced by 19.4% while fuel expenditure shrank by 30.5%.
Amongst other items that contributed to the decline in expenditure on imports in March 2013 were transport equipment categorised under investment goods, textiles and textile articles categorised under intermediate goods and motor vehicles categorised under consumer goods.
“As expenditure on imports declined by around US$ 857 million during the first three months of 2013 while earnings from exports declined by around US$ 207 million, in comparison to the corresponding period of 2012, the deficit in the trade balance for the first quarter of 2013 contracted on a year-on-year basis. Accordingly, the policy measures adopted last year to curb the trade deficit to a sustainable level have continued to be effective.”