SL imports top three-year high by Sept 2021 amid money printing

DM | Published: 11:09 AM Oct 20 2021
Business SL imports top three-year high by Sept 2021 amid money printing

Sri Lanka’s imports hit USD 1.68 billion in September 2021, amid record money printing, the highest since 2018 when money was also printed losing forex reserves, data show.

The surge in imports came despite import controls.

Up to August imports were Rs. 13.4 billion, up from Rs. 10.25 billion in 2020 and also up from Rs. 12.88 billion in the pre-pandemic 2019.

In 2019, the Central Bank did not print money until August and collected forex reserves running deflationary policy. 

Imports were Rs. 15 billion up to September in 2018.

Imports grew in 2021 despite controls.

Imports of cars, gold and fertilizer were almost non-existent. 

Fertilizer imports were down to USD 0.9 million from USD 32 million in the pre-pandemic year of 2019. 

Sri Lanka has a trade deficit due to domestic agents spending non-merchandise related inflows like remittances, IT and tourism receipts. 

Though there were hardly any vehicles imported, money flowed into other ‘permitted’ sectors favoured by control-oriented bureaucrats.

Analysts had warned that imports will pick up as domestic credit and economic activity picked up.

Economists and analysts have called for central bank reform or a its abolition to a currency board for many years to stop high inflation, currency depreciation, output volatility and social unrest.

DM | Published: 11:09 AM Oct 20 2021

More News