Since
1977 Sri Lanka has consistently followed a policy of economic
liberalisation and structural reform. The focus of this policy
has been the promotion of private sector investment and the
development of the export sector. Successive governments over
the last two decades have sustained this economic policy.
As a result, an economic environment conducive to greater
private sector participation has been created.
Under the market oriented policy reforms, the Sri Lankan economy
has experienced considerable economic and social change. Over
the years the country's reliance on primary agricultural products
has gradually diminished and a diversified production base
has emerged. Correspondingly, the standard of living of the
people has also improved significantly.
In 2002 Sri Lanka posted a growth rate of 4%, buoyed by the
peace process, strong fiscal consolidations, a renewed effort
towards structural reforms and a more favourable international
environment. Inflation has been on a steady downward slope
and is presently at single digit levels. Unemployment has
fallen from 9.2% in 1998 to 7.9% in 2001, a result of increasing
opportunities in the tourism, manufacturing and small business
sectors.
