First quarter GDP up 5.5% over revival in construction activities

Sri Lanka’s economy has expanded by 5.5 percent during the first quarter of 2016 from a year ago largely supported by the strong growth in the industrial activities, which picked up by 8.3 percent, as the country’s construction activities resumed after a hiatus of almost a year, the data released by the statistics office showed.

According to the Census and Statistics Department, the first quarter gross domestic product (GDP) was measured at Rs.2,088,024 million in comparison to Rs.1,978,609 million recorded during the corresponding quarter in 2015.

The construction sector contribution, which narrowed to 6.8 percent of GDP by the end of 2015, picked up by 12.0 percent during the quarter. Construction – a sub-sector under the industry sector – had a 7.2 percent share of GDP in 2014 due to the post-war renaissance of infrastructure development activities but was disturbed after January 1, 2015, when the good governance regime stalled major infrastructure projects pending clearance from alleged corruption associated with them.

Sri Lanka’s first quarter GDP growth still remains strong amid the challenges in both domestic and hostile global economic development.

This is also fairly in line with the expectation of the Central Bank, which wants to grow the economy between 5.5 percent and 6.0 percent in 2016.

However, the country last week received an International Monetary Fund (IMF) life line - a US $ 1.5 billion reform - heavy extended fund facility - which is expected to put the economy back on track.

THE FIRST QUARTER GROSS DOMESTIC PRODUCT (GDP) WAS MEASURED AT RS.2,088,024 MILLION IN COMPARISON TO RS.1,978,609 MILLION RECORDED DURING THE CORRESPONDING QUARTER IN 2015.