The trade deficit for the first nine months of 2012 declined by 0.3 per cent. This was the first time since December 2009 that the cumulative trade deficit for the year declined, stated the Central Bank in its External Sector Performance – September 2012.
The multi-pronged policy strategy implemented during the first half of 2012 to curb the widening trade deficit has therefore helped reduce the deficit in the current account. The declining trend in earnings from exports decelerated sharply in September 2012 as tea exports fared well after declining for three consecutive months, the Bank further said.
Expenditure on imports meanwhile, continued to respond to the tighter policy environment and recorded a sharp decline of 25.4 per cent in September 2012, the Bank adds.
The lower import expenditure during September 2012 reflected developments in respect of both external and domestic economic conditions.