Economy in Sri Lanka

Economy in Sri Lanka
Economy—overview: At independence in 1948 plantations growing tea rubber or coconuts and paddies growing rice for subsistence dominated Sri Lanka's economy and as late as 1970 plantation crops accounted for 93% of exports. In 1977 Colombo abandoned statist economic policies and its import substitution trade policy for market-oriented policies and export-oriented trade. Sri Lanka's most dynamic industries now are food processing textiles and apparel food and beverages telecommunications and insurance and banking. By 1996 plantation crops made up only 20% of exports while textiles and garments accounted for 63%. GDP grew at an annual average rate of 5.5% throughout the 1990s until a drought and a deteriorating security situation lowered growth to 3.8% in 1996. The economy rebounded in second half 1996 however and continued to perform well in 1997 with growth of 6%. Sustained economic growth coupled with population growth of only 1.1% has pushed Sri Lanka from the ranks of the poorest countries in the world up to the threshold of the middle income countries. For the next round of reforms the central bank of Sri Lanka recommends that Colombo expand market mechanisms in nonplantation agriculture dismantle the government's monopoly on wheat imports and promote more competition in the financial sector. A continuing cloud over the economy is the fighting between the Sinhalese and the minority Tamils which has cost more than 60 000 lives in the past 23 years.

GDP: purchasing power parity—$85.34 billion (2005 est.)

GDP—real growth rate: 5,6% (2005 est.)

GDP—per capita: purchasing power parity—$4 300 (2005 est.)

GDP—composition by sector:

agriculture: 17.8%

industry: 27.6%

services: 54.5% (2005)

Inflation rate—consumer price index: 15.4% (sep. 2006)

Labor force:

total: 8.08 million (2005)

by occupation: services 45% agriculture 38% industry 17% (1998 est.)

Unemployment rate: 6.3% (2006 est.)

Budget:

revenues: $3.804 billion

expenditures: $5.469 billion (2005 est.)

Industries: processing of rubber tea coconuts and other agricultural commodities; clothing cement petroleum refining textiles tobacco

Industrial production growth rate: 6.5% (1996 est.)

Electricity—capacity: 1.557 million kW (1997 est.)

Electricity—production: 7.308 billion kWh (2003 est.)

Electricity—consumption per capita: 220 kWh (1997 est.)

Agriculture—products: rice sugarcane grains pulses oilseed roots spices tea rubber coconuts; milk eggs hides meat

Industries—products: processing of rubber, tea, coconuts, tobacco and other agricultural commodities; telecommunications, insurance, banking; clothing, textiles; cement, petroleum refining, vehicles

Exports:

total value: $6.442 billion (f.o.b. 2005)

commodities: textiles and apparel, tea and spices, diamonds and other gems, coconut products, rubber products, petroleum products, fish (2005)

partners: US 30.9% UK 11.6% India 6.9% Belgium 4.8% Germany 4.5% (2005)

Imports:

total value: $8.37 billion (f.o.b. 2005)

commodities: textile fabrics, mineral products, petroleum, foodstuffs, machinery and transportation equipment (2005)

partners: India 168% China 10.5% Singapore 7.6% Iran 5.8% Hong Kong 4.8% (2005)

Debt—external: $11.05 billion (2005)

Economic aid:

recipient: ODA $577 million (1998 est.)

Currency: 1 Sri Lankan rupee (SLRe) = 100 cents

Exchange rates: Sri Lankan rupees (SLRes) per US$1—100.498 (2005) 101.194 (2004) 96.521 (2003) 95.662 (2002) 89.383 (2001)

Fiscal year: calendar year