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Economic growth

Sri Lanka's Economy to Grow by 4.5% in 2025, According to Central Bank Report

Strategic Insights

— 1 min read

The Central Bank of Sri Lanka has released a monetary policy report projecting a 4.5% economic growth rate for 2025, surpassing the World Bank's estimate of 3.5%. The country is expected to achieve a 5% growth in gross domestic product by 2024, thanks to a $2.9 billion aid package from the International Monetary Fund (IMF). However, the report also notes the risks associated with external demand and global economic dynamics, which may impact short- and medium-term growth prospects.

Key Takeaways:

  • Sri Lanka's economy is projected to grow by 4.5% in 2025, higher than the World Bank's estimate of 3.5%.
  • The country aims to achieve a 5% growth in gross domestic product by 2024, supported by a $2.9 billion aid package from the IMF.
  • The garment industry, Sri Lanka's second-largest foreign exchange earner, is expected to face challenges due to the US reducing its tariff rate to 20% from 44% in April.
  • The garment industry generates $4.8 billion in foreign exchange in 2024, employing approximately 300,000 people, most of whom are women.
  • Sri Lanka's consumer price index has declined significantly, from 70% in September 2022, primarily due to lower electricity and food prices.
  • The Central Bank of Sri Lanka expects inflation to continue accelerating, reaching its target of 5% by mid-2026.
  • The Central Bank of Sri Lanka maintained its benchmark interest rate at 7.75% last month.

Statistics:

  • Sri Lanka's economy is projected to grow by 4.5% in 2025.
  • The country aims to achieve a 5% growth in gross domestic product by 2024.
  • The garment industry generates $4.8 billion in foreign exchange in 2024.
  • The garment industry employs approximately 300,000 people, most of whom are women.
  • Sri Lanka's consumer price index has declined to 16% as of July 2024.
  • The US reduced its tariff rate on Sri Lanka to 20% from 44% in April 2024.

Sources:

  • Central Bank of Sri Lanka
  • World Bank
  • International Monetary Fund (IMF)
  • Reuters

https://cccme.org.cn/news/details.aspx?id=70576EC3D5D52025E0625899CE1C7472&classid=8C92359A9456952E&xgid=F868932F64EB7AAF

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