INSUBCONTINENT EXCLUSIVE:
construction and tourism-related services
According to the report in 2025, growth is expected to moderate to 3.5 percent reflecting scarring effects of the crisis and structural
Lanka Development Update, titled Staying on Track, highlights that despite the positive growth and fiscal performance, significant
While the economy is recovering, many Sri Lankans are still struggling
Household incomes, employment, and overall welfare are still well below pre-crisis levels, and the poverty rate remained alarmingly high at
24.5 percent in 2024 according to the report
implementing key structural reforms amid an increasingly uncertain global environment
The World Bank forecasts moderate growth of around 3.1 percent for Sri Lanka in 2026
Shifting to a higher growth trajectory through the successful implementation of reforms that enhance trade, investment, competition and
female labor force participation, among others, is essential to ensure that all Sri Lankans benefit from the recovery
Looking ahead, the World Bank emphasizes the continued need for policy reforms to maintain macro-fiscal and financial stability, boost
competitiveness, increase productivity, and expand job opportunities.The Sri Lanka Development Update is a companion piece to the South Asia
Development Update, a twice-a-year World Bank report that examines economic developments and prospects in the South Asia region and analyzes
policy challenges countries face
This outlook is subject to heightened risks, including from a highly uncertain global landscape, combined with domestic vulnerabilities
including constrained fiscal space
It includes a special chapter analyzing the state of domestic resource mobilization in the region
The report outlines how countries can address inefficiencies in tax policy and administration to increase revenues so they can enhance
resilience amid an increasingly challenging global economic environment.
