Annual Report 2008 - Ministry of Finance and Planning

6. A Sectoral Perspective
236
An Overview
The growth of the Sri Lankan economy was sustained
in 2008, despite the challenging external and domestic
environment. Real GDP grew by 6.0 percent, albeit at a slower
pace from the 6.8 percent achieved in 2007. The growth
was led particularly by domestic agriculture and plantation
sector, transport, post and telecommunication, banking and
insurance sectors. The deepening of the global financial and
economic crisis was manifested in the decline in exports of
goods and services in the latter part of 2008. With these
adverse external impacts, the nine months average of 6.5
percent decelerated to 4.3 percent in the fourth quarter of
2008. Continuation of the highest contribution to GDP, the
service sector represented 57.3 percent with the industry
and agriculture sectors contributing 29.4 percent and 13.4
percent respectively.
Chart 6.1
Services
The services sector expanded at a decelerated rate of 5.6
percent in 2008 from 7.1 percent in 2007 particularly with
a negative growth of the hotels and restaurants sub-sector.
The major contributors to the services sector performance
were import trade, post and telecommunication sectors.
All other sub-sectors such as export trade, transport and
financial activities recorded a slower pace due to the world
economic slow-down, triggered in the second half of 2008.
Table 6.1
Sectoral Growth rate of GDP (%)
Category 2006 2007 2008
Agriculture 6.3 3.4 7.5
Industry 8.1 7.6 5.9
Services 7.7 7.1 5.6
Overall GDP 7.7 6.8 6.0
Source : Department of Census and Statistics
In real terms, the total production value in the service sector
amounted to Rs. 1,406 billion in 2008 compared to Rs. 1,331
billion achieved in 2007 whereas in terms of current prices
it was Rs. 2,525 billion in 2008.
Chart 6.3
Chart 6.2
The wholesale and retail trade sub sector grew by 4.7 percent
in 2008 as against 7.1 percent achieved in the previous
year. The hotels and restaurants sub sector contracted by
5 precent as against the previous year. The transport and
telecommunication sector grew by 8.1 percent in 2008
compared to the 10.5 percent witnessed in 2007 while the
banking and real estate sub-sector grew by 6.6 percent in
2008 in comparison to 8.7 percent in 2007.
Ministry of Finance and Planning Sri Lanka
Annual Report 2008