Sri Lanka Economy 2007

Economy - overview:
In 1977, Colombo abandoned statist economic policies and its import substitution trade policy for more market-oriented policies, export-oriented trade, and encouragement of foreign investment. Recent changes in government, however, have brought some policy reversals. Currently, the ruling Sri Lanka Freedom Party has a more statist economic approach, which seeks to reduce poverty by steering investment to disadvantaged areas, developing small and medium enterprises, promoting agriculture, and expanding the already enormous civil service. The government has halted most privatizations. Although suffering a brutal civil war that began in 1983, Sri Lanka saw GDP growth average 4.5% in the last 10 years with the exception of a recession in 2001. In late December 2004, a major tsunami took about 31,000 lives, left more than 6,300 missing and 443,000 displaced, and destroyed an estimated $1.5 billion worth of property. Growth, partly spurred by reconstruction, reached 5% in 2005 and more than 6% in 2006. Sri Lanka's most dynamic sectors now are food processing, textiles and apparel, food and beverages, port construction, telecommunications, and insurance and banking. In 2005, plantation crops made up only about 15% of exports (compared with more than 90% in 1970), while textiles and garments accounted for more than 60%. About 800,000 Sri Lankans work abroad, 90% in the Middle East. They send home more than $1 billion a year. The struggle by the Tamil Tigers of the north and east for an independent homeland continues to cast a shadow over the economy.

GDP (purchasing power parity):
$95.46 billion (2006 est.)

GDP (official exchange rate):
$27.4 billion (2006 est.)

GDP - real growth rate:
7.4% (2006 est.)

GDP - per capita (PPP):
$4,700 (2006 est.)

GDP - composition by sector:
agriculture: 16.5%
industry: 27.1%
services: 56.5% (2006 est.)

Labor force:
7.602 million (2006 est.)

Labor force - by occupation:
agriculture: 34.3%
industry: 25.3%
services: 40.4% (30 June 2006 est.)

Unemployment rate:
7.6% (2006 est.)

Population below poverty line:
22% (2002 est.)

Household income or consumption by percentage share:
lowest 10%: 1.1%
highest 10%: 39.7% (FY03/04)

Distribution of family income - Gini index:
50 (FY03/04)

Inflation rate (consumer prices):
13.7% (2006 est.)

Investment (gross fixed):
28.7% of GDP (2006 est.)

Budget:
revenues: $4.883 billion
expenditures: $6.827 billion (2006 est.)

Public debt:
93% of GDP (2006 est.)

Agriculture - products:
rice, sugarcane, grains, pulses, oilseed, spices, tea, rubber, coconuts; milk, eggs, hides, beef; fish

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

Industrial production growth rate:
6.2% (2006 est.)

Electricity - production:
8.411 billion kWh (2005)

Electricity - consumption:
7.072 billion kWh (2005)

Electricity - exports:
0 kWh (2005)

Electricity - imports:
0 kWh (2005)

Oil - production:
0 bbl/day (2006 est.)

Oil - consumption:
82,000 bbl/day (2006 est.)

Oil - exports:
NA bbl/day

Oil - imports:
NA bbl/day

Oil - proved reserves:
0 bbl (1 January 2006)

Natural gas - production:
0 cu m (2005 est.)

Natural gas - consumption:
0 cu m (2005 est.)

Current account balance:
$-1.046 billion (2006 est.)

Exports:
$7.172 billion f.o.b. (2006 est.)

Exports - commodities:
textiles and apparel, tea and spices; diamonds, emeralds, rubies; coconut products, rubber manufactures, fish

Exports - partners:
US 27.6%, UK 11.3%, India 9.3%, Belgium 4.7% (2006)

Imports:
$9.378 billion f.o.b. (2006 est.)

Imports - commodities:
textile fabrics, mineral products, petroleum, foodstuffs, machinery and transportation equipment

Imports - partners:
India 19.6%, China 10.5%, Singapore 8.7%, Iran 5.7%, Malaysia 5.1%, Hong Kong 4.2%, Japan 4.1% (2006)

Economic aid - recipient:
$1.189 billion (2005)

Reserves of foreign exchange and gold:
$2.948 billion (2006 est.)

Debt - external:
$12.16 billion (2006 est.)

Stock of direct foreign investment - at home:
$NA

Stock of direct foreign investment - abroad:
$NA

Market value of publicly traded shares:
$7.769 billion (2006)

Currency (code):
Sri Lankan rupee (LKR)

Exchange rates:
Sri Lankan rupees per US dollar - 103.99 (2006), 100.498 (2005), 101.194 (2004), 96.521 (2003), 95.662 (2002)