Sri Lanka : EXTERNAL SECTOR PERFORMANCE SUMMARY – May 2025
❖ The monthly current account recorded surpluses in all months in 2025 up to May, reflecting robust performance of the external sector.
❖ The merchandise trade deficit widened in May 2025 compared to May 2024, reflecting a larger y-o-y growth in imports relative to merchandise exports. However, the trade deficit narrowed compared to April 2025.
❖ Vehicle imports including both personal and commercial vehicles amounted to US dollars 118 million in May 2025, bringing the total for the period from January to May 2025 to US dollars 312 million.
❖ The terms of trade deteriorated during the month, as the increase in import prices exceeded the increase in export prices.
❖ In terms of direction of trade, the United States, India, and the United Kingdom remained the top export destinations, while China, India, and the United Arab Emirates continued to be the leading sources of imports in May 2025 as well as during the January–May 2025 period.
❖ In May 2025, the services sector net inflows recorded a slight decline relative to its performance in May 2024. However, the services sector net inflows recorded a 6.8 per cent growth during the first five months of 2025, reaching US dollars 1.8 billion.
❖ Earnings from tourism in May 2025 were estimated at US dollars 164 million, recording cumulative earnings of US dollars 1.5 billion during January–May 2025.
❖ Workers’ remittances recorded a growth of 17.9 per cent (y-o-y) in May 2025, contributing to cumulative remittances of US dollars 3.1 billion during the period from January–May 2025.
❖ Foreign investments in the government securities market recorded a turnaround from a net outflow in the previous month to a marginal net inflow in May, while the foreign investments in the Colombo Stock Exchange (CSE) (considering both primary and secondary markets) also recorded a marginal net inflow.
❖ Gross official reserves (GOR) by end May 2025 stood at levels broadly similar to end April 2025 at US dollars 6.3 billion. GOR include the swap facility with the People’s Bank of China (PBOC).
❖ As of end June 2025, the year to date depreciation of the Sri Lanka rupee against the US dollar was 2.5 per cent.
