Sri Lanka is a small island nation located off the southern coast of India. It has a population of approximately 21 million people, and a GDP of around $100 billion. Sri Lanka has experienced strong economic growth in recent years, with its economy expanding by over 6% annually since 2010. The country’s economy is largely driven by services, which account for nearly two-thirds of GDP. Tourism is an important part of the Sri Lankan economy, with the sector accounting for over 5% of GDP and contributing significantly to foreign exchange earnings.
According to cheeroutdoor, agriculture is another crucial component of Sri Lanka’s economy, contributing approximately 10% to GDP and employing nearly 30% of the workforce. The main agricultural products are tea, rubber, coconuts and rice. Manufacturing also plays an important role in the country’s economy, accounting for around 15% of GDP and employing about 15% of the workforce. Major industries include textiles, garments & apparel production and food processing.
The government has implemented several reforms aimed at improving the business environment in order to attract foreign investment into Sri Lanka’s manufacturing sector. These reforms include streamlining bureaucratic procedures for setting up businesses as well as providing tax incentives to foreign investors who set up operations in Sri Lanka’s Free Trade Zones (FTZ). Additionally, the government has also invested heavily in infrastructure projects such as ports and airports which have helped improve connectivity within the country as well as between other countries in South Asia and beyond.
In order to further boost economic growth, Sri Lanka needs to focus on increasing export competitiveness by reducing tariffs on imports and improving access to finance for small businesses. Additionally, there needs to be more investment into research & development activities so that Sri Lankan companies can become more competitive globally. Finally, it is essential that efforts are made towards reducing poverty levels across different parts of the country so that more people can benefit from economic growth going forward.
The country’s economy is mainly agricultural-based, but also the light industry and the service sector are important. Despite a costly civil war and recurring misery, the country’s economy grew by about 5 percent during the 1990s, a growth rate that, with the exception of 2001, when Columbus’s airport was subjected to terrorist acts, was largely maintained during the 00s. The state receives large revenues from around 1.5 million foreign-working locals.
In the late 1970s, a socialist regulatory economy was abandoned, and market forces were given more leeway, a development that was further accentuated during the 1990s. The economic development has largely been guided by the country’s dependence on the International Monetary Fund and the World Bank, as well as foreign lenders and assistance.
Agriculture and fishing
The formerly sharp boundary between an export-oriented plantation sector and a people-supplying smallholder sector has in recent years become increasingly diffuse. An increasing proportion of the most important export crops (tea, rubber and coconuts) are grown by small farmers, while the production of basic foodstuffs has become more market oriented. The country’s rice production has increased substantially in recent decades, mainly thanks to increased cultivation area but also through the introduction of domestically developed high-yielding plants.
Fishing is an important and growing industry. In 2007, 318,600 tonnes of sea fish were landed.
Minerals and energy
The country is relatively rich in minerals, which form the basis for some local industry, such as the production of glass, ceramics, salt and brick. Graphite, gemstones, iron ore and ilmenite are also extracted, of which the first two are important export goods. Sri Lanka has no known assets on oil or coal. During the 1980s, an extensive expansion of water energy was carried out, for example through Swedish assistance to the power plant in Kotmale, and water energy is the completely dominant source of electricity.
The manufacturing industry mainly manufactures consumer goods such as textiles, clothing, cigarettes and food. Until the beginning of the 1990s, most of the heavier industry was state-owned, but since then the production of graphite, gas and rubber products has been increasingly privatized. In recent decades, through tax relief and other benefits, the authorities have sought to stimulate industrial establishment in special investment zones (IPZs).
Abbreviated as LKA by abbreviationfinder.org, Sri Lanka has had a negative trade balance for an extended period. The main import goods are oil, raw materials for the textile industry and workshop products, but also basic foods such as wheat, rice and sugar are imported. In terms of value, imports from India are the most significant. The most important export goods are textiles, tea, rubber products, coconuts and precious stones. The main export market is the United States.
- COUNTRYAAH: Find major trading partners of Sri Lanka, including major exports and major imports with latest trade value and market share as well as growth rate.
Tourism and gastronomy
Sri Lanka is a tourist country with a pleasant climate, fine sandy beaches and clean bathing water. In 2016, the country had just over 2 million visitors, mainly from India and the UK. Most tourists live in one of the coastal resorts north or south of the capital Colombo. In Mount Lavinia, 13 km south of Colombo, the British governor’s summer residence has been transformed into hotels with partly well-preserved interiors.
Further south are the resorts of Hikkaduwa and Galle, the latter with building memories from the Portuguese and Dutch colonial times. Colombo also holds an important memorial from the Dutch era in the famous Wolfendahl church. Otherwise, the capital of the capital is characterized by monumental buildings from the 19th century as well as well-stocked market blocks. The National Museum’s collections of sculptures and ethnographies are worth a visit.
Note: the capital city of Sri Lanka is Sri Jayawardenapura Kotte (administrative capital) with a population of 108,000 (2012 census), and Colombo (commercial capital) with a population of 606,000 (2019). Other major cities include Kaduwela, Maharagama, Dehiwala-Mount Lawinia, Moratuwa, Negombo (Migamuwa), Kalmunai (Galmune), Kandy (Maha Nuwara), Galle (Galla).
The largest resort is Negombo north of the capital, with nice beaches for divers. From here, there are paths to the major cultural attractions in the interior, listed on UNESCO’s World Heritage List. In Anuradhapura there are many Buddhist shrines from the centuries before Christ and in Polonnaruva the remains of a well-planned capital from the 11th-11th centuries. Nature lovers can see, among other things, leopard and bear in Wilpattu National Park near Anuradhapura. For ornithologists there are also bird sanctuaries in the south and southeast.
In the island’s inland mountains lies the town of Kandy, with palaces and shrines from the last Sinhalese kingdom. There are also octagonal temples in which a tooth from the Buddha is preserved, to which many Buddhists pilgrimage. The neighborhood around Adam’s Peak is also sacred. At the top is a temple over a 1.5 meter long depression. Islamic pilgrims attribute the imprint Adam; the Buddhists put it in connection with the Buddha and the Hindus with Shiva. In Nuwara-Eliya, the British created an even well-preserved place of recreation.
Sri Lankan cuisine is very similar to the South Indian. Most dishes are vegetarian and the offerings may appear limited to rice, curry and dhal (lentil porridge), but one curry dish is rarely the same as the other. In common, however, they are generally very spicy. If you want a milder version you should look for white curry or kiri, which is cooked on coconut milk. Fresh seafood is featured in many recipes, either grilled whole and served with lentils, spiced rice or medium (shredded vegetables with cumin and coconut) or included in dishes such as simore (fish in strong sauce) or kiri malu (mild fish curry). A distinctive Sri Lankan dish is hoppersor string hoppers (small rice flour pancakes) with fish or curry eaten for breakfast or with syrup as dessert. Another is lamp rice, rice cooked in meat broth which, together with a curry stir, is packed in banana leaves and baked in the oven. Pastries and desserts carry an unmistakable Dutch feature: at Christmas, the breudher is eaten like a Dutch yeast bun. The wattle patch is a steamed egg cream with the same origin.