Growth Driven by Services, Tea, and Coconut Products Despite Setbacks in Apparel and Seafood
Sri Lanka’s export sector continued to demonstrate resilience and progress during the first five months of 2025, with total exports—including both merchandise and services—reaching $6,933.35 million. This represents a 7.14% increase compared to the same period in 2024.
In May alone, total exports amounted to $1,386.66 million, marking a year-on-year growth of 6.35%. This positive performance reflects the success of Sri Lanka’s ongoing strategies to diversify its export markets and enhance competitiveness across sectors.
Merchandise exports grew by 1.70% year-on-year in May, reaching $1,028.52 million, based on provisional data from Sri Lanka Customs, which includes estimates for gems and jewellery and petroleum products. From January to May, merchandise exports rose by 5.46%, totalling $5,344.23 million.
Services exports have played an increasingly vital role in Sri Lanka’s export growth. In May, estimated earnings from services exports stood at $358.14 million. Over the five-month period, services exports increased by 13.20%, reaching $1,589.12 million. This growth reflects the rising contribution of Sri Lanka’s knowledge-based economy, particularly in the areas of ICT/BPM, construction, financial services, and transport and logistics. These sectors continue to diversify the export portfolio and create high-value employment opportunities across the island.
Among merchandise exports, tea remained a strong performer. Tea exports, which represented 12.8% of total merchandise exports in May, rose by 14.58% year-on-year to $131.81 million, largely due to a 14.61% increase in tea packet exports. The volume of tea exports also grew by 13.78%. Notable increases in tea exports were recorded to Iraq (53.74%), Libya (236.84%), and Iran (123.31%), reflecting growing demand from key Middle Eastern markets.
Coconut-based products also experienced a strong upswing in May, with earnings increasing by 33.33% compared to the same month in 2024. This growth was driven by a 48.78% increase in coconut kernel products, a 13.45% rise in coconut fibre products, and a 35.29% increase in coconut shell products. Within the kernel category, exports of coconut oil surged by 93.59%, coconut milk powder by 52.77%, coconut cream by 47.26%, and liquid coconut milk by 36.92%, indicating rising global demand and greater value addition in the sector.
However, some traditional export segments faced challenges. Export earnings from apparel and textiles declined slightly by 0.38% year-on-year to $388.81 million in May. The rubber and rubber finished products sector fell by 9.33%, with a particularly weak performance in sheet rubber exports, which dropped by 40.91%. The seafood sector also struggled, with export earnings down 22.11% to $13.56 million, largely due to a 53.64% decrease in fresh or chilled fish exports. Similarly, ornamental fish exports dropped by 57.43% to $0.86 million.
Despite these sector-specific declines, Sri Lanka’s overall export performance in the first five months of 2025 shows encouraging growth. The rising significance of services exports, the revival of tea and coconut product demand, and the sustained expansion of value-added goods underscore the adaptability and strength of the country’s export economy.