Sri Lanka's Economy Grows 5% in 2024, Forecasts 3.5% Growth in 2025

Sri Lanka’s economy rebounded strongly in 2024, exceeding World Bank expectations by achieving 5% growth, mainly driven by the construction and tourism sectors. However, growth is projected to moderate to 3.5% in 2025 and 3.1% in 2026 due to lingering effects of the recent crisis, structural challenges, and global economic uncertainties. Despite these gains, poverty remains high at 24.5%, and household incomes and employment have not yet returned to pre-crisis levels. The World Bank emphasizes the need for policy reforms to maintain stability, expand job opportunities, and promote inclusive growth. Meanwhile, Sri Lanka’s exports surged in the first quarter of 2025, with total exports rising by 5.87%, and services exports, particularly in ICT and logistics, showing robust double-digit growth, helping to diversify the economy and create high-value jobs. The positive export performance reflects the resilience and adaptability of Sri Lankan exporters amid ongoing global and domestic challenges.