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Sri Lanka back to its high poverty levels

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From L to R: Yvette Fernando (Former Senior Deputy Governor at CBSL), Dr. Ganeshana Wignaraja (Convener of the Independent Growth Study Group), Dr. Sirimal Abeyratne (Executive Director CEPA), Dr. Dirk Willem te Velde (Director, ODI Global International Economic Development Group)

Sri Lanka’s estimated poverty (share of the population living on less than $3.65 a day) remains stubbornly high, affecting as much as a quarter of the population in 2024, and twice as high as in 2021. The reversal in poverty reduction gains during the crisis has taken Sri Lanka back to its high poverty levels of the early 2000s, finds a new study by the Centre for Poverty Analysis(CEPA).

The report, launched on Tuesday in Colombo, says: The economy has stabilised remarkably well since weathering its worst economic crisis since Independence, but there are substantial risks of a relapse. The country now needs to continue with macroeconomic stabilisation and implement a range of growth policies, with a new focus on state capacity.

The report, titled ‘Sustaining Transformative Growth in Sri Lanka 2025–2030’, offers a bold roadmap for Sri Lanka to achieve sustainable and inclusive economic growth over the coming five years. Authored by an Independent Growth Study Group, under the auspices of ODI Global and the CEPA, the report provides critical policy recommendations for navigating the country’s complex economic landscape as it emerges from its worst economic crisis since independence.

Developed by a team of nine leading experts, with extensive experience across public, private, and international sectors, the report highlights the significant progress made in stabilising the Sri Lankan economy, including renewed growth and reduced inflation. However, it stresses that the persistent challenge of high poverty levels requires a focus on economic transformation with structural reforms and targeted sectoral policies to mitigate future risks and unlock the nation’s vast potential.

Dr Ganeshan Wignaraja, Visiting Senior Fellow at ODI Global and Convenor of the Independent Growth Study Group, said: “Sri Lanka has shown remarkable resilience in overcoming recent economic hardship, but the journey towards prosperity requires more than resilience – it demands bold action. This report provides a crucial framework, not just for consolidating the hard-won gains of stabilisation, but for igniting truly transformative growth that uplifts all Sri Lankans. The opportunity is here, and we must act decisively to create a more inclusive and resilient economy.”

The study identifies six key policy areas as crucial for achieving sustainable growth: maintaining macroeconomic stability, integrating into global supply chains, improving factor markets, implementing targeted sectoral policies, reducing poverty and building political consensus. It also highlights key sectors poised for growth, including tourism, the digital economy, niche manufacturing and agriculture, driving the economic transformation of Sri Lanka in the future.

Prof. Sirimal Abeyratne, Executive Director of CEPA and a co-author of the report, emphasised the critical role of trade in this transformation: “Sri Lanka’s historical under-performance in exports is directly linked to a persistent anti-export bias and cumbersome business regulations. Our findings underscore that strategically opening up to global trade and rigorously streamlining business procedures are not just options, but essential accelerators to boost exports, stimulate investment and unleash the full potential of Sri Lankan businesses on the international stage.”

Prof. Dirk Willem te Velde, Director of the International Economic Development Group at ODI Global, said: “In today’s volatile global economy, Sri Lanka’s experience serves as a powerful lesson for recovery from deep economic crisis, setting an example for other emerging economies facing similar challenges. Our study argues how targeted policies for trade and production, innovation and digital economy, and governance can transform the country’s economic landscape and avoid further macro-economic crises. This report is a call to action for all stakeholders – government, business, civil society and citizens alike – to work together towards a shared vision of a prosperous and transformed Sri Lanka.”

The report urges a concerted effort to leverage Sri Lanka’s strategic location and build on existing production capabilities to drive growth and reduce poverty. It emphasises the importance of strategic engagement with global and regional supply chains and the digital economy to boost exports and attract foreign investment.



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President pays homage to the Sacred Tooth Relic

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President Anura Kumara Dissanayake visited the historic Sri Dalada Maligawa (Temple of the Sacred Tooth Relic) in Kandy on Thursday (01) morning , where he paid homage to the Sacred Tooth Relic and received blessings for the New Year. Thereafter, the President called on the Mahanayake Theros of the Malwathu and Asgiri Chapters and received their blessings.

The President also participated in religious observances held at the Temple of the Sacred Tooth Relic and engaged in cordial conversation with devotees who had gathered to mark the New Year.

Subsequently, the President visited the Malwathu Maha Vihara and called on the Most Venerable Thibbatuwawe Sri Sumangala Mahanayake Thero. The President also inquired into the well-being of the Mahanayake Thero and engaged in a brief discussion.

The Deputy Registrar of the Malwathu Chapter, the Most Venerable Rajakeeya Panditha Darshanapathi Mahawela Rathanapala Nayaka Thero, was also present on the occasion. The Maha Sangha chanted Seth Pirith and invoked blessings upon the President.

The President also met the Anunayake of the Malwathu Chapter, the Most Venerable Dimbulkumbure Vimaladhamma Thero, and inquired into his well-being.

Subsequently, President Dissanayake visited the Asgiri Maha Vihara, where he met the Most Venerable Warakagoda Sri Gnanarathana Mahanayake Thero of the Asgiri Chapter and engaged in a brief discussion.

Extending New Year blessings to the President, the Asgiri Mahanayake Thero expressed his best wishes for the successful continuation of the Government’s programme, led by the President, aimed at building a more prosperous nation for the people, with renewed strength and determination in the New Year.

The President also met the Anunayake of the Asgiri Chapter, the Most Venerable Narampanawa Ananda Anunayake Thero, and held a brief discussion.

During these meetings, the President briefed the Mahanayake Theros and Anunayake Theros of both chapters on the measures being implemented by the Government to address the challenges arising from the most severe natural disaster in the country’s history experienced in the past year. The Maha Sangha extended their blessings for the successful continuation of these efforts.

Deputy Minister of Transport and Highways, Prasanna Gunasena, Member of Parliament Thanura Dissanayake and several others were also present on the occasion.

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Foreign warships commended for their assistance during weather disaster in Sri Lanka

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Highlighting the spirit of global and regional cooperation, the Sri Lanka Navy acknowledged the invaluable support by foreign warships, which had arrived to take part in the International Fleet Review (IFR) 2025, extending much-needed Humanitarian Assistance and Disaster Relief (HADR) operations, during the recent weather disaster in Sri Lanka.

The IFR 2025 was held off the Galle Face seas, marking the milestone 75th anniversary celebrations of the Sri Lanka Navy.

Representing the Government of Sri Lanka, Prime Minister Dr. Harini Amarasuriya graced the event and received the traditional naval salute from onboard SLNS Gajabahu, as the participating foreign warships paid their honours.

Eight (08) foreign naval warships arrived in Sri Lanka by 27 November to take part in the IFR under the theme “Sailing Strong – Together”. The participating warships included the Bangladesh Navy’s BNS PROTTOY, the Indian Navy’s aircraft carrier INS VIKRANT and INS UDAYGIRI, Iran Navy’s IRIS NAGHDI, the Maldivian Coast Guard’s CGS HURAVEE, the Royal Malaysian Navy’s KD TERENGGANU, Pakistan Navy’s PNS SAIF and Russian Navy’s GREMYASCHCHY.

Due to the disaster-situation triggered by severe weather conditions across the island, foreign warships that arrived for the event were promptly redirected to support humanitarian efforts. Particularly, helicopters deployed from the Indian Navy’s aircraft carrier INS VIKRANT and Pakistan Navy’s PNS SAIF played a praiseworthy role in search and rescue missions for affected communities.

Accordingly, the warships representing each nation joined the IFR, honouring proud maritime traditions and in acknowledgement of Sri Lanka and its Navy. Their participation also reinforced collective cooperation and partnership needed to address non-traditional maritime threats in the region, as well as natural disasters driven by climate change.

The  Prime Minister expressed gratitude to a group of diplomatic officials, present on this occasion, for their support in the disaster relief operations. The officials, who were present on the occasion, represented the High Commissions and Embassies of Bangladesh, India, Iran, Maldives, Malaysia, Pakistan, and Russia in Sri Lanka.

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I invite you to step into 2026 with renewed energy, hope, and determination – PM

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Prime Minister Dr Harini Amarasuriya in her New Year message invited all Sri Lankans to step into 2026 with renewed energy, hope, and determination.

The PM’s New Year message:

“As we move forward to the New Year of 2026, it is timely to reflect on the year 2025 that has passed. The year 2025 can be granted as a year having made a number of decisive and progressive steps with a people oriented government.

I am confident that, within a new political culture, we were able to strengthen transparency in state governance and lay the foundation for an efficient and corruption free public service.

We can be satisfied with the progress achieved in several key areas during 2025, including economic stability, the increasingly positive and optimistic international perception towards our country, the establishment of transparent systems of governance, and the strengthening of the sovereignty of the legislation system.

However, the unfortunate disastrous situation we experienced towards the end of 2025 was a challenging period for our nation. While it deeply moved us all, the spirit of solidarity, compassion, and collectivity shown by Sri Lankans during that difficult situation received admiration across the world.

As we step into the New Year 2026, we hold commitment to overcoming those challenges, healing from the disaster, and restoring the lives and livelihoods that were affected.

Moving forward with the goals such as initiating qualitative and sustainable transformation in the education sector, digitalizing all sectors of the public service, creating an enabling environment for entrepreneurs, artists, and creators with innovative ideas to rise on the global stage, and building a compassionate, environmentally friendly society free from drugs and harmful substances I would like to remind, at this moment, that the responsibility of rebuilding this nation rests upon the entire nation, together with the government, transcending differences of ethnicity, religion, or political affiliation, and united by a strong Sri Lankan identity.

Transforming all the challenges we experienced in the past year into sources of strength, I invite you to step into 2026 with renewed energy, hope, and determination.

I extend wishes for a victorious New Year filled with peace, happiness, and prosperity.”

 

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