Economic Performance of Sri Lanka

1. Economic Performance of Sri Lanka Trends of Economic Growth Rate of Sri Lanka

2. Gross domestic Product(GDP) • Gross Domestic Product(GDP) is the monetary value of the value added generated in the production of goods and services inside the country diring a year.

3. Economic Growth rate • Economic growth rate can be defined as a percentage increase of real Gross Domestic Product(GDP).

4. National Accounting of Sri Lanka

5. National Accounting of Sri Lanka • Cover all economic activities • Data are collected from about 250 institutions (as a sample) so as to represent all above economic activities • Use 1993 SNA guidelines in the estimation process • Data are analyzed by using a computer system

6. National Accounting of Sri Lanka • Five statisticians and fifteen statistical officers are engaged in the compilation process of national accounts estimates • Sri Lanka is one of countries which collects quarterly data and compile quarterly national accounts estimates • Quarterly national accounts estimates are derived by using the indicator method in other countries

7. National Accounting of Sri Lanka • Advance Data Release Calendar is published in the department web site. • GDP estimates are released during the 75 days time lag of each quarter • Estimation procedure is consisted by several rounds and press notes prepared in these stages should not be considered as final one until Director General of DCS release the final press note to the web

8. National Accounting of Sri Lanka • Estimation procedure • Data collection starts in the first week of next quarter • Estimation procedure is supervised by the statisticians and estimates can be revised • Separate Internal discussions for different economic activities • Two discussions of statisticians • Two discussions with director of National Accounts Division • A discussion with Additional Director General • Final discussion with Director General

9. National Accounting of Sri Lanka • Director General is the authorized person to release all indicators produced by the department • The previous draft documents prepared in different stages should not be considered as final report

10. Responsibility of National Accounting for Sri Lanka DCS started national accounting in 1948 and continued Both institutions, DCS and Central Bank of Sri Lanka compiled national accounts estimates up to 2007. Sole responsibility of national accounting was given to the DCS from 2007.

11. Economic activities of Sri Lankan economy • International Standard of Industrial Classification(ISIC) is used • Agriculture Forestry and Fishing • Industry • Services

12. Main economic activities of Sri Lankan economy • Agriculture, forestry and Fishing • agriculture • Livestock • Forestry and Fishing • Industry • Mining and quarrying • Manufacturing • Electricity, Gas and Water • Construction • Services • Wholesale and retail trade • Hotels and restaurant • ප්transport and communication • Banking Insurance and Real estate • Ownership of Dwellings • Government services • Private services

13. Quarterly economic growth rates @ provisional

14. Quarterly economic growth rates • In the year 2009 economic growth rate has gone down to 3.5 percent level mainly due to world economic slowdown • After the end of the war economic growth rate exceeds 8.0 percent (2010 and 2011) • It fluctuates around 7 percent in recent quarters

15. Agriculture

16. Trends of Paddy production Million Busals Source- Department of Census and Statistics

17. Paddy production in Northern and Eastern provinces Million Busals Source- Department of Census and Statistics

18. Trends of Paddy production • Paddy production has increased from 2005 • Harvested area has increased from 1.4 Acre Mn to 1.8 Acre Mn • Average yield has increased from 77 Busals to 90 busals • Government intervention • Increase paddy prices • Fertilizer subsidy • Expansion of irrigation schemes

19. Trends of Tea production මෙට්‍රක් ටොන් දහස් වර්ෂය source- ශ්‍රSrilanka Tea Board @estimated figure.

20. Trends of Tea production • A positive trend of tea production from 2005 • Although demand for tea has decreased due to world economic slowdown in the year 2009, it recoverd from 2010

21. Maize production මෙ.ටො. දහස් Source- Department of Census and Statistics

22. Source- Department of Census and Statistics Livestock and animal production Department

23. වර්ෂය Source- Department of Census and Statistics

24. වර්ෂය Source- Department of Census and Statistics

25. Production of Milk • Milk production in Northern and Eastern provinces increased after the end of the war.

26. Industry

27. Source :-Sri Lanka Customs “Industrial Export Earnings” to Total Export Earnings is more than 75%. “Textile and Garments” to Total Export Earnings is more than 50%.

28. Source:-Ceylon Electricity Board

29. Source:- Water Supply & Drainage Board

30. Source:- Litro Gas Company Ltd Laugfs Gas PLC

31. Construction, Manufacturing and Fixed Capital formation

32. Imports of Cement Source: Sri Lanka Customs

33. Annual Cement availability

34. Directs and indirect effects of increase in cement supply to the economy • To increase output of construction sector • To expand other cement related industries • To develop infrastructure • To increase capital formation or gross investment

35. Services

36. Government sector

37. Government Expenditure Source: Government Budget, Department of estate accounts

38. Government Expenditure • Both current and capital expenditure increased continuously • GDP increases directly when government expenditure increases according to Keynesian identity • (Y = C + I + G + X – M), G • Purchasing power of Household increses due to increase of GDP • Investment and capital stock increase due to increase of capital expenditure • Increased capital stock lead to increase future production Y=GDP, C=Private Consumption, I=Investment, G=Government Expenditure, X-M=net exports

39. Hotels & restaurantand Tourism industry

40. Tourist arrivals Source: Sri Lanka Tourism Development Authority

41. Effects of increase of tourist arrivals • Increase of output of hotels and restaurant sector • Expansion of services activities such as transport and telecommunication • Even though tourist arrivals increased, Income of star hotels remains same or can be decreased. This is mainly due to tendency to use unregistered accommodation and other services.

42. Transport

43. Number of registered Cars and Three wheelers Source- Department of motor traffic

44. implications of increase of registered vehicles • Increase of transport services • Expansion of service sector • Increase house hold luxury consumption

45. Export and Import

46. Exports Source- Sri Lanka Customs • Increased export income since 2006, shows us that the production of related goods has also increased during the last few years • Export income of the year 2009 has gone down as a result of world economic slowdown

47. Imports Source- Sri Lanka Customs • Import of intermediate goods and investment goods has increased than consumer goods from 2006 • As intermediate and investment goods are used in the production of goods and services it was a favorable factor to the economic growth of the country

48. VAT income from wholesale and Retail trade activities Rs.Mn Source- Department of Inland revenue • VAT income from wholesale and Retail trade has increased repidly and it shows the expansion of trade activities and consumption

49. Turnover of Wholesale and Retail trade sector Source- Department of Census and Statistics

50. VAT income from wholesale and Retail trade activities • Profit and salaries & wages of financial institutions has increased continuously from 2005 by showing increased demand for monetary intermediation