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Monday, May 14, 2012 - 05.12 GMT
Every chance that Sri Lanka will become a breakout nation Economic Times


Today, it seems that Sri Lanka's time has come. The civil war is over, the process of healing is under way, and there is every chance that Sri Lanka will become a breakout nation. Despite slowing sharply during the war years, the economy continued to grow at an average pace of nearly 5% even though it was running on one engine: the prosperous Western province where Colombo is located, and where the well-educated young population was producing strong growth in industries and services, an Economic Times article said.

"Banks are returning, big retail chains are setting up shop, and domestic airlines are flying to Jaffna and Trincomalee again. The flood of state spending drove growth in North and East provinces up to 14% in 2009 and 2010, and they are expected to grow at above 13% for several more years, making them the fastest-growing areas of the country," article written by Ruchir Sharma said.

Sri Lanka could be the country to move the region toward a new trade regime. The government is proposing a grand deal that could unlock trade with India and provide a huge boost to the economy.

Over the course of its war, Sri Lanka grew its economy slowly but positively, by a total of 206%. The country now has economic and administrative momentum. The government can build prosperity without interruption by suicide bombers.

(The author is head of emerging markets at Morgan Stanley Investment Management. This article has been adapted from his new book, Breakout Nations)

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Last modified: May 14, 2012.

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