Under the rebased gross domestic product (GDP) estimation method Sri Lanka’s economic growth slowed to 3.3 % in 2021, compared to 3.7% reported already under the previous base year of 2010.
However, the GDP at current prices, re-estimated under the 2015 base year, increased by an average of 6 % between 2015 and 2021 compared to the GDP under the 2010 base year, mainly due to the inclusion of the value addition came from the reclaimed land of the Colombo Port City project and the outsized role of the IT services.
The new GDP numbers rebased to 2015, from the hitherto used 2010 released by the Census and Statistics Department as part of its periodic rebasing exercise, to be in line with the international best practice and also to identify the emerging economic activities such as IT and IT-based services, which became more outsized in terms of their economic contribution in recent times.
While the GDP growth rates for 2016 and 2017 were adjusted upwards under the rebased GDP estimates to 5.1 % and 6.5 %, respectively, from the previous 4.5 % and 3.6 %, as the majority of the Port City land reclamation took place in 2017, the growth faltered thereafter, resulting in a contraction in the economy in 2019, as the reclamation work reached its final stages.
As a result, in 2018, the GDP growth fell to 2.3 %, from 3.3 % recorded previously before entering a recession in the following year, with a contraction of 0.2 % in 2019, compounded by the slowdown in economic activities, as a result of the Easter Sunday attacks. Earlier, the 2019 economic growth was reported at 2.3 %, under the old base.
As a result, Sri Lanka’s economy had contracted for two consecutive years, in 2019 and 2020, in the latter year by 3.5 %, under the new base estimate, compared to the 3.6 % contraction under the old base.
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