In line with the global trends, export earnings declined by 12.7 per cent to US dollars 7,085 million in 2009 compared to that of 2008. All major sectors reflected declines in growth while the largest contribution to the decline in overall exports was from the industrial sector (83.1 per cent) followed by the agricultural sector (16.0 per cent)
Earnings from agricultural exports, which accounted for 23.9 per cent of total export earnings, declined by 8.9 per cent to US dollars 1,690 million in 2009. However, there was an improvement in the performance of agricultural exports during the last quarter, led by the high prices of tea, rubber and some minor agricultural commodities in the international markets. Tea exports accounted for 16.7 per cent of earnings in 2009 followed by minor agricultural products (3.4 per cent), coconut (2.4 per cent) and rubber (1.4 per cent).
Earnings from industrial exports declined by 13.8 per cent to US dollars 5,305 million in 2009 reflecting contractions in all sub-sectors owing mainly to lower global demand. However, the textile and garment exports, which accounted for 46.2 per cent of the total exports, emerged relatively unscathed. Other industrial exports, such as food, beverages and tobacco, rubber, diamonds and jewellery, and machinery and equipment, which together accounted for another 20.5 per cent of the total exports, contracted in 2009, despite some improvement shown towards the latter part of the year.
Earnings from textile and apparel exports, which is the main category of industrial exports, stood at US dollars 3,274 million in 2009, reflecting a decline of 5.6 percent. These exports, which performed well during the first quarter of 2009, were affected by the global recession during the second quarter, as was expected by the industry. However, the export performance during the second half of the year was encouraging. Therefore, when the overall developments during the year are considered, Sri Lanka's textile and garment sector was the least affected of the industrial exports in 2009. The strength of the apparel industry lies in its entrepreneurial foresight and the willingness to adapt to the changing environment. Sri Lanka has world class manufacturing facilities and adopted ethical manufacturing practices, which have helped to earn an international reputation as a reliable supplier of high quality clothing. The major players in the industry introduced eco-friendly manufacturing mechanisms in response to global market developments.