Sri Lanka economy witnesses growth of 4.7% in Q2 2024

COLOMBO: Economy of Sri Lanka grew faster than expected in the second quarter, bolstering sentiment ahead of a crucial election that could affect policy as the country recovers from its worst crisis in decades, agencies reported.

Gross domestic product rose 4.7 percent in the three months to June from a year ago, the Statistics Department said Friday.

The south Asian island nation will hold a presidential election on 21st September. The incumbent government secured a US$3 billion bailout from the International Monetary Fund to finance the nation’s recovery from a default-induced slump.

In Sri Lanka, services are the biggest sector of the economy and account for 58 percent of total GDP. Within services the most important segments are: wholesale and retail trade (21 percent); transport and communication (13 percent) and banking, insurance and real estate (11 percent). Industry accounts for 30 percent of total output. Within industry, manufacturing represents 18 percent of GDP and mining and construction account for 10 percent. The remaining 12 percent is contributed by agriculture, livestock, forestry and fishing.

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To bolster growth further, Sri Lanka’s new government will have to complete restructuring debt and follow through on IMF-mandated reforms to keep the funds flowing.