• Overall income for first 4 months hits $ 956m: CB 
• Remittances rise by 6.6% to $ 644 m, gross official reserves reach $ 7.5 b boosted by currency swap with India

Sri Lanka’s lucrative post-war tourism boom continued to prosper in the first quarter of 2015 with earnings increasing by 13.6% year-on-year to $ 762.3 million, latest data from the Central Bank showed, pushing overall income to nearly $ 1 billion by end-April.

Tourist arrivals grew at a rate of 18%, year-on-year, to 157,051 in March 2015. Accordingly, tourist arrivals during the first quarter of the year amounted to 478,838, recording a year-on-year growth of 13.6%. Earnings from tourism are estimated to have recorded year-on-year growth of 13.6% to $ 762.3 million during the first three months of 2015, compared to the cumulative earning of $ 671 million during the corresponding period of 2014.

The top five sources of tourist arrivals in March 2015 were India, UK, Germany, China and France, accounting for 49.3% of total tourist arrivals during the month. Tourist arrivals recorded a growth of 8.5% year-on-year in April 2015, with 122,217 tourists arriving during the month. Consequently, the cumulative tourist arrivals in the first four months in 2015 increased by 12.5% to 601,055 compared to the corresponding period of 2014. “The cumulative earnings from tourism increased to $ 956.8 million during the first four months of 2015 compared to $ 850.3 million recorded during the same period in 2014,” the Central Bank report added.

Inflows continued to be strengthened by workers’ remittances that increased by 6.3%, year-on-year, to $ 644.3 million in March 2015 from $ 605.9 million recorded in March 2014. The cumulative inflow from workers’ remittances increased marginally by 1% to $ 1,679.4 million during the first quarter of 2015 in comparison to the corresponding period of 2014.
“Foreign investments in the Government securities market, which recorded a net outflow of $ 15.4 million during the first quarter of 2015, recorded a net outflow of $ 41.6 million by 28 May 2015.”

Meanwhile, foreign investments in the Colombo Stock Exchange (CSE) up to the end March 2015 recorded a net inflow of $ 38.6 million, including net inflows to the secondary market amounting to $ 21.9 million and inflows to the primary market amounting to $ 16.7 million. Net inflows to the CSE by 28 May amounted to $ 51.6 million including primary market inflows up to end April 2015. During the first quarter of 2015, long-term loans obtained by the Government amounted to $ 222.6 million. During the first quarter of 2015, the overall Balance of Payments (BOP) is estimated to have recorded a deficit of $ 1,016.8 million, compared to a surplus of $ 828.3 million recorded during the corresponding period of 2014.

Sri Lanka’s gross official reserves as at end March 2015 are estimated to be $ 6.8 billion, equivalent to 4.2 months of imports while total foreign assets amounted to $ 8.6 billion, equivalent to 5.3 months of imports.  The gross official reserves increased to $ 7.5 billion by end April 2015, which included proceeds of $ 400 million from the currency swap arrangement between Central Bank of Sri Lanka and Reserve Bank of India.

With the proceeds of the international sovereign bond, SLDBs and the expected proceeds of the balance portion of $ 1.1 billion from the currency swap agreement between Sri Lanka and India together with other regular investment inflows, gross official reserves are expected to increase further during the next few months, the report noted.