Sri Lanka’s current dollar earnings from merchandise exports, remittances, tourism and other services exceeded imports by 542 million US dollars in April 2024, official data shows.
Sri Lanka’s hard goods exports were 877.6 million US dollars in April, up from 848.6 million US dollars a year ago, in a holiday month which usually has a 20 percent downturn.
Remittances were 543.8 million US dollars, up from 454 million last year.
Tourism income was estimated at 225.7 million US dollars for April, which is from a survey and may not be as reliable as import export data from customs or remittances data from banks.
Gross services which include tourism was 558 million US dollars.
Foreign exchange earned by Sri Lankans from exports, remittances and gross services services were 1,977 million US dollars in April 2024.
Merchandise imports were only 1,435 million US dollars, leaving a surplus of 542 million dollars.
Sri Lanka’s central bank has started to release more service data in 2024 giving broader picture beyond the Merchandise trade account.
Turning in their graves?
In Sri Lanka there is a strong belief in the trade deficit. Macroeconomists also dangle the ‘current account deficit’ as an excuse for monetary instability after printing money to enforce rate cuts, dredging up doctrine from the days of from classical mercantilism in the 17th century, and dressing it up with a new label (the current account deficit vs the commercial balance).
Economic textbooks may be directly to blame for the revival of Mercantilism as well as the bureaucratic policy rate, analysts say.
The Mercantilist doctrine of the commercial balance was comprehensively refuted by classical economists including Smith, Hume, Mill, Thornton, and Torrens in particular who had micro-knowledge of note-issue operations.
In the last century German-Austrian and Swedish economists directly challenged Keynes but the doctrine has persisted among Anglophone academics in particular as inflationism worsened from the 1960s with Fed activism.
