Economy bounces back with 1.6% growth in 3Q-2023

For the first time since the economic crisis, Sri Lanka’s economy has recorded a positive year-on-year GDP growth rate of 1.6% for the third quarter of 2023.

The GDP for the third quarter of 2023 at constant price (2015) has increased up to Rs. 2,946,107 million from Rs. 2,900,654 million which was recorded in the third quarter of 2022.

The Agricultural, Industrial and Services activities expanded by 3 per cent, 0.3 per cent and 1.3 per cent respectively in the third quarter of 2023.

Sri Lanka had recorded a minus 8% growth when it declared bankruptcy in April 2022. The country’s economy continued to be in the negative from the fourth quarter of 2021 according to the Department of Census and Statistics (DCS) said in a press release on Friday.

In the third quarter of the year 2023, the performance of the service sector has also expanded by 1.3% when compared to the 4.2% shrinkage reported in the same quarter of the year 2022. Though several rating agencies said that Sri Lanka’s overall growth for 2023 would remain negative, this positive GDP growth rate of 1.6% has proved them wrong. The country’s economy in 2024 is expected to further grow with a positive growth. Sri Lanka is currently going through a strict IMF-based reform regime. President Ranil Wickremesinghe, who is also the finance minister, insists on reforms despite strong criticism from the opposition. Wickremesinghe told Parliament this week that reforms were essential, despite the hardships faced by the public. According to the quarterly review of this quarter, ‘Financial service activities’ have reported a 0.5 per cent decline while ‘Insurance services’ have reported 29.6 per cent positive growth.

Further, ‘accommodation, food and beverage serving activities’ (34.9%), ‘Programming and broadcasting activities’ (10.9 per cent), ‘Transportation of goods and passengers including warehousing’ (5.7 per cent), ‘Postal and courier services’ (3.3 per cent), ‘Professional services’ (1.9%), ‘Educational services’ (1.8 per cent), ‘Human health services’ (1.0 per cent), ‘Wholesale and retail trade’ (0.9%) and ‘Other personal services’ (0.6%) have reported considerable positive growth rates during this quarter.

The three major economic activities of the economy; ‘Agriculture’, ‘Industry’ and ‘Services’ have contributed their share to the GDP at current prices by 7.8%, 28.1% and 57.5% respectively, while ‘Taxes fewer subsidies on products’ component have contributed 6.5% of share to the GDP in the third quarter of the year 2023.

However, activities such as ‘IT programming consultancy and related activities’ (20.1 per cent), ‘Real estate activities and ownership of dwelling’ (5.7 per cent) and ‘Telecommunication’ (2.6 per cent) have reported negative growth rates during the third quarter of 2023.

The post Economy bounces back with 1.6% growth in 3Q-2023 appeared first on DailyNews.