Nations Trust Bank imposes limit of $100 on an overseas online transaction

COLOMBO: Sri Lanka’s exports grew 12.13 percent from a year earlier to 1,083 million dollars in August 2021, also overtaking a pre-pandemic level but forex shortages worsened, and a credit card operator imposed a 100 dollars a day limit on foreign transactions.

The August 2021 revenue of $ 1,083.56 million  is slightly up from the pre-COVID19 pandemic export earnings in August 2019 of $1,033.00 million.

“It is remarkable to see another month of exports over a billion US$ despite the ongoing pandemic,” Suresh de Mel, Export Development Board (EDB) Chairman said in a statement.

“Going forward we need to add more value to our exports and explore niche markets, and diversify our product basket and markets,” he added.

Sri Lanka is in the middle of severe forex shortages after continuous money printing to pay state worker salaries and also keep down gilt yields from the begging of 2020.

This week Nations Trust Bank, which provides America Express credit cards imposed a limit of $100 on an overseas online transaction.

Sri Lanka’s low rupee rates despite a wide budget deficit and liquidity injections had led a balance of payments deficit of 5.082 billion US dollars from the beginning of 2020 to July 2021.

In a country heavily driven by Mercantilist ideology, many genuinely believe that exports will reduce a trade or current account deficit and not more imports as recipients spend the money.

They also believe exchange rates fall due to imports not due to liquidity injections that undermine the anchor of the paper money.

Apparel export has increased 12.13 percent compared to 491.5 million dollars in August 2021.

EDB said apparel has grown 12.84 percent while woven fabrics 312.9 percent also recovering from a drop in exports in July.

Export earnings from Tea in August 2021 increased by 13.41 per cent to 116.78 million dollars and export volume has increased by 16.1 percent in August 2021 compared to August 2020.

Export earnings from rubber and rubber finished products have increased by 27.31 percent to 92.34 million dollars in August 2021 with strong performance in exports of pneumatic and retreated rubber tyres and tubes and industrial & surgical gloves.

The coconut-based products have generated an increase of 13.21 percent or 92.34 million dollars in August 2021.

The exports to Sri Lanka’s largest 10 export destination too has increased in the last eight months, EDB said.