Market Briefing – Sri Lanka

Sri Lanka

The Democratic Socialist Republic of Sri Lanka, located in southern Asia, is an island on the southern tip of the Indian Sub-continent in the Indian Ocean. It overlooks India across Palk Strait. Sri Lanka is also known as the Pearl on the Indian Ocean. The country possesses rich fisheries, forestry, hydropower and mining resources. Mining resources include graphite, gems, ferrotitanium, zircon and mica. They have world-famous mines for sapphires, rubies, cat’s eye and star sapphire, with an annual gem exports amounted to US$500 million, being one of the top five major gem mining countries in the world giving the island the reputation of “Gem Island”. The economy relies on plantations with a weak foundation in industries; it mainly focuses on agricultural products and the garment processing industry. In 1978, Sri Lanka was the first country in South Asia to implement an economic free trade policy, actively attracting foreign investments and promoting the privatisation of industries. A market-orientated economy was gradually developed and maintained moderate economic growth.

Kandy is the second largest city of Sri Lanka

A tea plantation in Sri Lanka

Stilt Fishing in Sri Lanka

Photos: http://www.globeimages.net/

Business Opportunities
Industries
Major industries are textiles, clothing, leather manufacturing, food, beverages, tobacco, chemicals, petroleum, natural rubber, plastics, non-metal mineral products processing industry and mining, and quarrying. In 2013, industrial activities made up to 31.1% of the domestic economy, mainly located in Colombo, the capital of the country. The same year, the export volume of textiles and the clothing industry, the largest export income earner, amounted to US$4.51 billion, equivalent to 43.4% of the total foreign trade export volume of the country. World famous gem and jewellery exports amounted to US$450 million, equivalent to 4.3% of the total exports.

Agriculture
There are four million hectares of arable land, with two million cultivated. Major produce are tea, natural rubber, coconut and rice. Exports of agricultural produce are a major export earner, comprising of around 25% of total foreign exchange earnings. In 2013, the export of tea amounted to US$1.54 billion (14.8% of total exports), exports of natural rubber totalled US$ 71 million (0.7% of total exports), coconut exports amounted to 205 million (2% of total exports).

Service industry
The service industry such as retail, hotels, food and beverages, transportation, warehouse storage, information and communications, tourism, financial services, real estate and business services, public management, as well as other social and personal services have become the major components of the domestic economy and momentum for economic growth, with particularly rapid and strong development in the information and communications industries. In 2013, the service industry comprised of 58.1% of GDP, with a growth rate of 6.4%, which include 9.4% growth for the communications industry.

Tourism
Tourism is an important component of the economy. Tourists come mainly from Europe, India and Southeast Asian countries and regions. In 2013, incoming visitors totalled 1.275 million, showing a year-on-year increase of 26.7%, revenue from the tourism industry amounted to US$1.715 billion, an increase of 65.2% year on year.

Source:CIA-The World Factbook, https://www.cia.gov/library/publ … ctbook/geos/ce.html

Foreign Trade from 2010-2014

Main Import Commodities: petroleum, textiles, machinery and transportation equipment, building materials, mineral products, foodstuffs
Source：
1.CIA-The World Factbook https://www.cia.gov/library/publ … ctbook/geos/ce.html
2.Index Mundi-Country Fact, http://www.indexmundi.com

Main Trading Countries/Territories with Sri Lanka 2013

Source：https://www.cia.gov/library/publications/the-world-factbook/geos/ce.html

Mainland China – Sri Lankae

1.Ministry of Commerce of the People’s Republic of China, http://mds.mofcom.gov.cn/article/Nocategory/

Macao – Sri Lankae Bilateral Trade 2014

Source: The Statistics and Census Service, http://www.dsec.gov.mo/

Source：
1.The Ministry of Foreign Affairs of the People’s Republic of China http://www.fmprc.gov.cn/chn/default.htm
2.The Ministry of Commerce of the People’s Republic of China http://zhs.mofcom.gov.cn/
3.The Economic and Commercial Counselor’s Office of the Embassy of the People’s Republic of China in the Democratic Socialist Republic of Sri Lanka http://co.mofcom.gov.cn/
4.The Statistics and Census Service http://www.dsec.gov.mo/
5.The World Factbook http://www.cia.gov/