Sri Lanka’s economy grew by 5.0% in 2024, its first annual growth since the 2022 crisis. The last quarter recorded a 5.4% increase, following a contraction in previous years. IMF support and ongoing reforms are credited for this recovery.
In 2024, Sri Lanka recorded a significant economic growth of 5.0% marking its first annual expansion since the severe crisis in 2022. Official data indicates that the economy grew by 5.4% in the last quarter of 2024, contrasting the prior year’s contraction of 2.3%. The peak of economic decline occurred in 2022, with a GDP shrinkage of 7.3% due to a shortage of foreign exchange, severely impacting essential imports such as food and fuel.
According to the Department of Census and Statistics, the positive growth in 2024 is hopeful for the future, following two consecutive years of GDP declines. Major contributors to this growth include agriculture, industry, and the services sector. The economic turmoil and subsequent shortages led to civil unrest and the ousting of former president Gotabaya Rajapaksa in 2022.
His successor, Ranil Wickremesinghe, successfully negotiated a $2.9 billion bail-out package from the IMF in 2023, implementing measures like tax increases, subsidy cuts, and price hikes. The current leftist government led by Anura Kumara Dissanayake, which took office in September, continues to uphold austerity policies.
Recently, the IMF released the fourth tranche of the bailout loan, commending Sri Lanka’s strong program performance. IMF Deputy Managing Director, Kenji Okamura, noted that the reforms are producing results, indicating a remarkable economic recovery that is anticipated to progress further in 2025.
Sri Lanka’s economy has rebounded with a 5.0% growth in 2024 after enduring significant downturns in 2022 and 2023. The growth highlights recovery across various sectors and reflects the success of the government’s austerity measures underpinned by international support from the IMF. Continued reforms are expected to foster ongoing economic improvement into 2025.
Original Source: www.thenews.com.pk
