GDP records 6.2 per cent in 2005

All major sectors record substantial growth

ECONOMIC PERFORMANCE: Sri Lanka's economy recorded a GDP growth rate of 6.2 per cent at constant (1998) prices in 2005 as against a GDP growth rate of 5.4 per cent for 2004.

"This is a remarkable economic performance for the year 2005", states the annual report of the Census and Statistics Department.

The Inflation Rate based on GDP Implicit Deflator indicated 10.0 percent for 2005 as against 2004. This is a significant increase compared to the inflation rate of 8.8 per cent recorded for 2004.

The GNP per capita at current market prices US $ 1,203 for 2005 as against (US $ 1,035) recorded for 2004.

This is a remarkable improvement for 2005 and in US dollar terms it is a 16.2 per cent increase for per capita GDP.

The first quarter of 2005 indicated comparatively poor economic performance than the other quarters of the year. The unsatisfactory performance shown for the first quarter was mainly due to the tsunami destruction.

This growth rate of 6.2 per cent in the GDP for 2005 over the previous year was relatively a better achievement compared to the targeted rate for 2005.

Performance of agriculture sector excluding the fishing industry has shown the highest recorded growth rate of 6.5% for 2005 after 1990.

The growth rate of 1.2 per cent was recorded for the agriculture sector including fishing industry in 2005 as against a growth rate of 0.5 per cent recorded in 2004.

Paddy production has indicated a growth rate of 23.4 per cent in 2005 as against a negative growth rate of 14.3 per cent in 2004.

Total paddy production for 2005 was Bushels 155.6 Mn. This is the highest production figure for the whole past period after Independence and the production is above 0.9% of the domestic demand.

Fertiliser application has increased by 17.5% in 2005 over the last year.

The paddy production extent has increased by 20.4% in 2005 from 2004./

This also indicated the government policy to protect paddy farmers by imposing import tax on rice imports.

Tea production has shown a growth rate of 2.2 per cent in 2005 as against 1.6 per cent in 2004.

A kilogramme of average green leaf price increased from Rs. 26.43 to in 2004 to Rs. 27.18 in 2005.

Small holdings of tea contributed 65% to the total tea production and its land area is 59% of the total land area of tea. Policy introduced to promote small holdings has reflected in this production figures Re-planting and new planting of tea has increased by 5.9% in 2005 as against 2004.

Rubber production was estimated to have 10.1 per cent annual growth rate for 2005 as against the growth rate 3.0 per cent for 2004. The latex price and the fertiliser application have increased by 11.0% and 5.8% respectively from 2004 to 2005.

The average price of latex has increased by 24.2% in 2005.

Rubber land area was 162,280 hectares in 1997 and it dropped to 115,000 hectares in 2004 due to low prices for rubber indicating 7.9% decrease and it increased to 115,280 hectares in 2005 indicating 2.4% increase over 2004. In real terms, the value added in the minor export crop sector increased by 16.3 per cent from Rs. 5,139 million in 2004 to Rs. 5,975 million in 2005.

Total fertiliser consumption was 650,503 MT in 2005 and it was a 17.3% increase over the last year. Paddy cultivation consumed 54% of total fertiliser usage for 2005 and it indicates a 17.5% increase for the reference year. Rubber cultivation has indicated 5.8% increase in fertiliser consumption in 2005 over the last year.

During 2005, the production of all livestock items has increased marginally. Milk production has decreased by 0.1%.

Manufacturing industry has recorded a growth rate of 6.1 per cent in 2005 as against 5.7 per cent in 2004. Exports (Customs) of apparel clothing accessories, knitted or crotched have increased in quantity terms by 35% and value terms increased by 15.8% in 2005 over 2004.

This sector has around 38% share in total garment exports.

Electricity, gas and water sector estimates have recorded a growth rate of 13.9 per cent in 2005 as against the increase of 6.1 per cent in 2004.

The total power generated by public and private sector in 2005 increased by 8.4 per cent.

A growth rate of 9.0 percent was estimated for the construction industry for 2005 as against the growth rate of 5.9 per cent for 2004. The availability of materials such as total cement quantity, values of imported construction materials and local materials have increased by 32.1 per cent, 23.4 per cent and 39.5 per cent respectively in 2005 from 2004.

The Total Service sector of GDP recorded 6.8 percent growth rate and made the highest contribution of 58.4 percent to the GDP in 2005.

A satisfactory performance can be seen in export trade. The total value of exports increased by 9.6% and in dollar value terms the increase was 10.2% in 2005 over the last year.

Export quantum index indicates 5.9% increase in 2005 over the last year. Accordingly export trade has shown 6.8% growth rate for 2005 over the last year.

The value of imports has increased by 10.8% in dollar terms as indicated in BOP in 2005 over 2004.