Sri Lanka’s manufacturing activities came to a near standstill recording the all-time low performance following the Easter terror attack.
The decline of manufacturing sector is mainly driven by the significant drop in New Orders and Production especially in manufacturing of food, beverages and tobacco and manufacturing of textiles, wearing apparels, leather and related activities products, Central bank announced today (Thursday 16).
This decline was mainly due to the New Year holidays in April and the security concerns that arose following the Easter Sunday attack which affected the smooth functioning of factory operations.
Most industries especially in textile and apparel sector highlighted that they had to restrict working hours in factories due to security concerns and were unable to achieve the desired production levels, CB said.
Services sector also deteriorated in April 2019 compared to March 2019, underpinned by decline in all five sub-indices, namely, New Businesses, Business Activity, Employment, Backlogs of Work and Expectations for Activity.
This was the first time that Services recorded a set back,since May 2015, when conducting of the survey began, CB said..
The deterioration in New Businesses, Business Activity, and Expectations for Activity was mainly due to Easter Sunday attack and prevailing uncertainty in the country.
This was observed across majority of the sub sectors in the Services sector, particularly in accommodation, food & beverage and other personal services sub sectors.
Those sectors largely depend on the tourist arrivals and wholesale and retail trade, and transportation sub sectors, which largely depend on the day to day activities of the people, CB claimed.
Respondents cited that limitation of business hours due to imposition of island wide curfew and low productivity of the staff due to fear as reasons for deterioration in Business Activity. However, they expect this situation to be normalized by June 2019,CB added.