Swot Analysis Of Sri Lanka

Political overview

For years before the war finally came to an end 1n 2009 Sri Lanka was marred by civil. Since then, the economics of the country has grown within the 5 years.

When the long running civil war finally over, Sri Lanka has opportunity to take advantage of its peacetime stability, educated workforce, geography, and scenic beauty.

Sri Lanka Government has set ambitious goals for its economic development – aspiring to GDP growth rates over 8% and looking to focusing more in developing economic hubs in areas such as ports, commerce, aviation, energy and, knowledge. With a more open climate investment and financial system, relatively stable monetary policy in place, improving area of infrastructure, and both middle class an d world-class

Many government departments appraise themselves relating to their competent, highly motivated staff, but still the government’s overall provision of services and overall performance is impeded by inefficiency, and economic growth is stymied by opaque government procurement practices. While some other companies in U.S and Europe have done and continue to do well here, others have departed frustrated.

While growth been moderate, high inflation over the years leading declining of export goods. Many observers believe Sri Lanka will have trouble paying back loans taken to improve infrastructure, although government officials are confident that growth will bring in the necessary revenue. In a March 2013 report, Moody’s Investor Services noted that Sri Lanka’s short-term debt maturing within a year remained elevated, even above the total foreign reserves. Moody’s considers this a significant risk to Sri Lanka if there was a sudden halt in external credit expansion.

The GDP growth was down in 2009 to 3.5% and the financial crisis affected the country foreign reserves which sharply dropped as global demand for Sri Lankan exports. For two years straight the GDP growth was around 8% 2010 and 2012. The growth ten slowed a bit in 2012 to around 6.5% due to decline in export, agriculture e.t.c.

The Central Bank initially predicted that economy will rise by 7.5% in 2013 and to over 8% yearly during 2014-2016. The January 2013 Central Bank Economic Roadmap made in 2013 claims the GDP will almost double before 2018 from the current GDP of US$59 billion in 2012 to US$100 billon in 2016, and the sri lanka government is hoping to increase country’s per capita income from the current value of US$2,900 in 2014 to US$4,000 by 2016.

But growth could be hampered by the lack of diversification of the export base, investor can diversify in order to reduce both the political and economic problems in the United States and EU countries, which are Sri Lanka’s major export markets. Government fiscal control has improved, but the losses of state-owned enterprises (SOE) are a major concern. Sri Lanka requires high levels of FDI to meet the desired growth levels, and the government claimed FDI in 2012 reached US$1 billion, which was only half of the US$2 billion target. UNCTAD reported 2011 FDI in Sri Lanka