Sri Lanka - Business and economy in a nutshell.
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The country's economy is on a rebound after a dismal performance in 2001. The stock market is booming once again and jobs are easier to come by. All this inspite of the global down turn in tourism in recent years and the gulf war which seriously effected the country's tea exports. |
Major Exports:
Tea |
The economy has been dependent for a long time on agricultural produce, garment exports and tourism. It's only within the last decade that industrial exports started making a noteworthy contribution. A more significant development is the rapid growth of the IT sector. Despite the Sillicon Valley becoming a death valley, Sri Lankan Software companies have seen a steady growth in revenue over the past few years. Several large US and European comanies out source their software development to Sri Lankan organizations.
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Despite four years of mismangement by the previous government, the country's economy was resillient enough to escape the asian economic crisis of the late 90s. However it wasn't strong enough to suffer for ever. As a result the GDP contracted in 2001 but recovered after the change in management. In past years the economy generally tended to grow speedily when tea prices were high. This dependence has gradually decreased with apparell exports making a big contribution. Sri Lankans working abroad also make major contribution to the country's coffers. |
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Marketed under the brand name Ceylon Tea, Sri Lankan teas have achieved a reputation as being the best in the world. Tea estates, originaly planted by British Settlers, were taken over by the government after independence and run into the ground. After privitization in the early nineties they have rebounded stronly to return to profitabilty. With some of these plantation companies are major attractions on the Colombo Stock Exchange. Other agricultural exports include spices, rubber and coconuts and more recently foliage plants and flowers. Though Sri Lanka still has a largely agrarian economy, all the requirement of wheat, and most of the rice and sugar requirements have to be imported. |
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Sri Lanka is rich in Mineral deposits such as Illemanite, Rutile, Graphite and Apatite. Unfortunately the technology for the processing of these raw material cannot be found within the country. Hence most of the minerals are exported to the industrialized nations as raw materials. The ceramics industry though makes full use of local raw material. Sri Lankan Ceramics are some of the finest in the world.
Large deposits of precious stones can be found In and around Ratnapura, the city of gems. and even though Sri Lanka does not possess diamond deposits, the low cost of labour has made Sri Lanka a centre for the processing of Diamonds.
Major international companies such as NTT,
Shell, and Caltex have made large investments in Sri Lanka, realising her
potential for quick growth. Lots of investment trusts and funds have also
invested heavily, being attracted by the small but vibrant Stock
Market.
Anoter institution, the BOI, or the Board of Investment was setup
to encourage foreign investmets but the BOI is
ruled by incompetent beaurocrats.
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