Sri Lanka’s Central Bank notes expansion in services and manufacturing in July
The Purchasing Managers’ Index (PMI) of the Central Bank of Sri Lanka has recorded an expansion in the country’s manufacturing and services sectors.
The Manufacturing PMI that recorded an increase in June 2021 has further increased in July 2021 recording an index value of 57.8, which is an increase of 7.4 index points compared to June 2021.
The increase has been attributed to the increases observed in New Orders, Production, Employment, and Stock of Purchases sub-indices.
According to the Central Bank of Sri Lanka, the improvement in the PMI is due to the significant increases in New Orders, Production, Employment, and Stock of Purchases sub-indices, particularly in the manufacture of textile and wearing apparel and the food and beverage sectors.
“Some respondents in those sectors highlighted that they received higher export orders, especially from the Europe, with the gradual normalisation of economic activities, and they resumed new recruitments with the expectation of future demand and following the progress of the COVID-19 vaccination program,” the Central Bank of Sri Lanka has noted in a release.
The Bank has stated that the Stock of Purchases sub-index had increased in line with the expansion in New Orders and Production while the Suppliers’ Delivery Time continued to lengthen in July 2021.
Business activities across most of the sub-sectors had increased in July in line with the relaxation of the travel restrictions.
Financial services sub-sector had reported a large improvement during the month while the transportation sub-sector had also seen considerable progress with growths due to passenger transportation and freight volumes.
Human health, insurance and telecommunication sub-sectors have also recorded improvements during July.
Key economic sectors in the country, especially the services, manufacturing and exports sectors have shown a growth momentum despite challenges posed by the global Covid 19 pandemic. Sri Lanka’s economy has shown great resilience to external and internal challenges through the years and is once again on the path to recovery after facing the pandemic challenges. The country is currently engaged in an aggressive development programme and is working towards achieving the target of business hub in the South Asian region. Given the ease of doing business environment in the country, the many trade agreements and trade concessions enjoyed by the country, Sri Lanka is undoubtedly an attractive business/investment destination in the region.
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