COLOMBO: Sri Lanka’s economy grew 4.9 percent year-on-year in the second quarter of 2025, official data showed on Monday, indicating a strengthening recovery from its worst financial crisis in decades.
Sri Lanka’s agriculture sector grew by 2 percent in the second quarter from a year earlier, while industrial output expanded by 5.8 percent, and services grew by 3.9 percent, the census and statistics department said in a statement.
Struck by a severe shortage of dollars, the economy went into free fall in 2022, contracting 7.3 percent as it grappled with soaring inflation, a sharply weaker currency and foreign debt default.
The economy shrank 2.3 percent in 2023.
But it made a stronger-than-expected recovery last year, posting 5 percent growth as measures implemented under a $2.9 billion, four-year bailout from the International Monetary Fund, secured in March 2023, bore fruit.
In the first quarter of this year Sri Lanka grew by 4.8 percent.
“Sri Lanka has shown a remarkable growth in its GDP, with the 7th consecutive quarter above 4.5 percent in testament to the recovery seen on the ground. The growth is above the 4.5 percent estimate by the Central Bank of Sri Lanka and is significantly higher than initial estimates by the World Bank and Asian Development Bank,” said Raynal Wickremeratne co-head of research at Softlogic Stockbrokers
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