COI Report March 2012 - UK Border Agency - Home Office

SRI LANKA 7 MARCH 2012
―Sri Lanka is engaging in large-scale reconstruction and development projects following
the end of the 26-year conflict with the LTTE [Liberation Tigers of Tamil Eelam],
including increasing electricity access and rebuilding its road and rail network.
Additionally, Sri Lanka seeks to reduce poverty by using a combination of state directed
policies and private investment promotion to spur growth in disadvantaged areas,
develop small and medium enterprises, and promote increased agriculture. High levels
of government funding may be difficult, as the government already is faced with high
debt interest payments, a bloated civil service, and historically high budget deficits. The
2008-09 global financial crisis and recession exposed Sri Lanka's economic
vulnerabilities and nearly caused a balance of payments crisis, which was alleviated by
a $2.6 billion IMF standby agreement in July 2009. The end of the civil war and the IMF
loan, however, have largely restored investors' confidence, reflected in part by the Sri
Lankan stock market's recognition as one of the best performing markets in the world.
Sri Lankan growth rates averaged nearly 5% in [sic] during the war, but increased
government spending on development and fighting the LTTE in the final years spurred
GDP growth to around 6-7% per year in 2006-08. After experiencing 3.5% growth in
2009, Sri Lanka's economy is poised to achieve high growth rates in the postwar
period.‖
2.02 The Human Development Index (HDI) for Sri Lanka in 2011 was 0.691, which gives the
country a rank of 97 out of 187 countries with comparable data. The GDP per capita
was around US$ 4,300 for 2009. The HDI is created ―…by combining indicators of life
expectancy, educational attainment and income into a composite human development
index…‖ (UNDP, Human Development Report 2011, Country Profile, Sri Lanka) 13 . The
CIA World Factbook 14 , (updated on 27 December 2011), noted that in 2010 GDP per
capita was estimated to be US$5,000 and the unemployment rate estimated at 5.8 per
cent. The same source stated that the percentage of the population below poverty line
in 2008 was estimated to be 23 per cent.
2.03 The Economist Intelligence Unit, January 2012 Sri Lanka report 15 , recorded that the
average consumer price inflation was 7 per cent in 2011 and was forecast at 6 per cent
for 2012. The EIU also gave the actual average unemployment rate at 5.4 per cent for
2011 (with a forecast of 5.1per cent for 2012).
2.04 The Sri Lanka Department of Census and Statistics recorded in their Statistical Abstract
2010, Socio Economic Indicators 16 (undated, website accessed on 1 June 2011) that in
2009 the total labour force was 7,572,363 with an unemployment rate of 5.7 per cent.
2.05 The approximate rate of exchange from xe.com Universal Currency Converter 17 on 18
January 2012 was £1 = 176 Sri Lankan rupees.
13 UNDP, Human Development Report 2011, Sri Lanka, Country profile of human development
indicators, http://hdrstats.undp.org/en/countries/profiles/LKA.html 2 November 2011, date accessed 18
January 2012
14 CIA - The World Factbook – Sri Lanka
https://www.cia.gov/library/publications/the-world-factbook/geos/ce.html updated on 27 December 2011
Date accessed 27 January 2012
15 Economist Intelligence Unit, January 2012 report,
http://www.eiu.com/report_dl.asp?issue_id=1008743885&mode=pdf [subscription only] date accessed 5
February 2012
16 Sri Lanka Department of Census and Statistics, Statistical Abstract 2010, Socio Economic Indicators,
undated http://www.statistics.gov.lk/abstract2010/Pages/indicators.htm date accessed 2 June 2011
18 The main text of this COI Report contains the most up to date publicly available information as at 3 February 2012.
Further brief information on recent events and reports has been provided in the Latest News section
to 2 March 2012.