Sri Lanka Economic Outlook
August 24, 2021Activity seemingly faced headwinds in Q2, as available data suggests weaker economic dynamics: Both the manufacturing and services PMIs remained downbeat amid the fallout from fresh restrictions brought about by a third wave of Covid-19 infections. In addition, the tourism sector recorded a setback in May–June. The panorama seemed to improve at the outset of Q3. On 8 July, authorities reduced quarantine requirements for fully vaccinated foreign visitors, providing some respite for the struggling tourism industry, with tourist arrivals increasing during the month. Moreover, both PMIs soared in July, as services benefited from additional tourist demand and key manufacturing subsectors such as textiles registered higher new orders, production and employment. That said, the imposition of a 10-day lockdown on 20 August should severely disrupt activity ahead.
Sri Lanka Economic GrowthGDP should recover this year, particularly in H2, amid an improving tourism sector as the global vaccine rollout facilitates international travel. In addition, recovering demand from advanced economies should support exports. That said, lingering Covid-19 restrictions, the recent shipwreck’s possible impact on tourism and elevated external debt pose downside risks. FocusEconomics panelists project the economy to grow 4.8% in 2021, which is down 0.3 percentage points from last month’s forecast. In 2022, our panel sees the economy growing 4.2%.
Sri Lanka Economy Data
5 years of Sri Lanka economic forecasts for more than 30 economic indicators.
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Sri Lanka Facts
|Exchange Rate||181.2||0.02 %||Jan 01|
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