Monday, December 31, 2012

Foreign inflows increasing in Sri Lanka

COLOMBO, Dec. 31 (Xinhua) -- Returns from Sri Lanka's booming post-war tourism industry, higher remittances and long term borrowings are expected to increase foreign inflows into the country, the Central Bank said in its latest data here on Monday.

For the first eleven months of 2012, workers' remittances recorded a growth of 17.1 percent year-on-year, amounting to 5,432 million U.S. dollars, it said.

Earnings from tourism during the first 11 months of 2012 increased by 23 percent year-on-year to 905.3 million U.S. dollars, which is expected to further increase given that the island passed its record one million arrivals over the weekend.

"Higher inflows in terms of tourism earnings and workers' remittances are expected to increase foreign exchange liquidity in the market, thereby strengthening the external value of the rupee, " the Central Bank said.

It also said substantial foreign currency inflows have been recorded in the capital and financial account of the balance of payments during the first eleven months of 2012.

Foreign investments at the Colombo Stock Exchange (CSE) increased to 280 million U.S. dollars, on a net basis, by the end of November 2012, while there have been a significant increase in foreign investments in government securities, with net inflows to Treasury bills and Treasury bonds during the first 11 months of 2012 reaching 833 million U.S. dollars.

Meanwhile, long-term loans obtained by the government during the first 10 months of 2012 amounted to 2,614 million U.S. dollars. In addition, long-term borrowings by commercial banks during the period amounted to 973 million U.S. dollars.

Gross official reserves amounted to 6,490 million U.S. dollars by the end of November 2012, equivalent to 4.1 months of imports by the end of November, while total reserves were equivalent to five months of imports.

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