Annual Reports - Sri Lankan Economy

The Sri Lankan economy exhibited its

resilience by recording a growth of 3.5

per cent in 2009 despite the challenges

emanating from both external and domestic

fronts. This was enabled by the steady recovery

of the economy since the second quarter of the

year reaching a growth of 6.2 per cent in the fourth

quarter. The growth in the year was subsequent to 4

consecutive years of robust growth where the annual

growth was 6.0 per cent or higher. The challenges

faced in achieving this growth in 2009 included the

synchronized downturn in major economies and the

heightened security concerns with the escalation of

the confl ict in the North during the fi rst half of 2009

as well as the unfavourable weather related setback

in the Agriculture Sector. The improved business

confi dence following the end to the confl ict and the

gradual recovery in the global economy are expected

to provide a further impetus to the growth prospects

of the Sri Lankan economy in 2010.

In the fi rst half of the year all three sectors

contributed to growth, although the Industry

and Services Sectors were adversely affected

by both the intensifi ed confl ict in the North as

well as the fallout of the global recession. The

growth registered by the Industry Sector during this

period was 2.4 per cent while the Services Sector

registered an even slower growth of 1.1 per cent.

The Agriculture Sector posted a growth of 3.7 per

cent with the bountiful Maha harvest contributing

signifi cantly to this growth. However, growth in this

sector in the fi rst half of the year was affected by the

poor performance in tea.

With the end of the conflict and gradual

recovery in the global economy, there was a

recovery