News
World Bank forecasts 2.2% growth for Lanka in 2024, driven by tourism and remittance recoveries
The latest Global Economic Prospects report from the World Bank forecasts a 2.2 percent growth for Sri Lanka’s economy in 2024, marking a positive revision of 0.5 percentage points from January. This upward revision is attributed to gradual improvements in remittances and tourism.
The June edition of the World Bank’s Global Economic Prospects report highlights that tourism and remittances have rebounded following the economic contraction in 2023. However, both sectors remain below pre-pandemic levels.
The report states, “In Sri Lanka, the economy is expected to expand by 2.2 percent in 2024—a 0.5-percentage-point upward revision from January—supported by modest recoveries in remittances and tourism. Growth is projected to strengthen further in 2025-26, reaching 3 percent in 2026, assuming successful debt restructuring negotiations and the implementation of structural reforms, which would offset the adverse impact of planned fiscal consolidation on growth.
“After contracting in 2023, economic activity has strengthened in Sri Lanka, with tourism and remittances also recovering, although they have remained below pre-pandemic levels.
“The report also forecasts a slowdown in growth for the South Asia (SAR) region, from 6.6 percent in 2023 to 6.2 percent in 2024, mainly due to a moderation in India’s growth from recent highs. Regional growth is expected to remain steady at 6.2 percent in 2025-26, supported by stable growth in India. Among other economies in the region, Bangladesh is expected to maintain robust growth, albeit at a slower pace than in previous years, while growth is set to strengthen in Pakistan and Sri Lanka. However, the outlook is clouded by downside risks, including disruptions in commodity markets due to escalating conflicts, potential abrupt fiscal consolidations, financial instability from high bank exposure to sovereign borrowers, extreme weather events, and slower-than-expected growth in China and Europe. Conversely, upside risks include stronger-than-expected activity in the United States and faster global disinflation.
“Several factors have contributed to reductions in external imbalances, such as narrowed trade deficits, increased remittances, and tourism recoveries across multiple countries. Additionally, continued import restrictions, particularly in Bangladesh, have played a role. Foreign exchange reserves have risen in countries like Pakistan and Sri Lanka, reflecting eased currency pressures and increased official flows, although reserves remain low in some nations.
“In the SAR region, economic spillovers from outside are generally limited due to lower international trade openness compared to other global regions. However, weaker-than-projected growth in major trading partners could dampen growth in countries like Bangladesh, Pakistan, and Sri Lanka. For instance, a significant portion of intermediate goods imports in these countries comes from China, and any downturn in Chinese activity could lead to material shortages and reduced economic activity.
“Upside risks to regional growth include stronger-than-expected activity in the United States, which could stimulate growth in large exporting countries like Pakistan and Sri Lanka. Another potential upside is greater progress in global inflation reduction, potentially leading to faster-than-expected easing of monetary policy, lower borrowing costs, and improved growth prospects.”
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Our goal is to build a “Thriving Nation” where a woman can walk without fear or doubt, where her talents are duly recognized, and where she can lead a life of dignity – PM
The PM’s message:
Women are the true pillar of Sri Lankan society and economy. The role they play within the family and in society has today become a decisive factor in shaping the future of our nation. Through the Government’s policy statement, “A Thriving Nation – A Beautiful Life,” we envision going beyond treating women as mere beneficiaries and recognizing them as active partners in national development, ensuring that they receive the dignity and opportunities they rightfully deserve.
Within our policy framework, special focus has been placed on women. We are committed to recognizing the economic contribution extended by women as housewives, promoting women’s entrepreneurship, and expanding access to the technical and financial support necessary for self-employment alongside strengthening the legal framework required to ensure women’s safety in public transport, workplaces, and within the family environment. Further, we are taking steps to create the environment to increase women’s representation in decision-making bodies at national and regional levels. Special attention is also being given to implementing targeted programmes aimed at improving women’s nutrition, reproductive health, and mental well-being.
Women are not a group seeking sympathy; they are vital social partners endowed with intelligence, resilience, and creativity. Our goal is to build a “Thriving Nation” where a woman can walk without fear or doubt, where her talents are duly recognized, and where she can lead a life of dignity
On this International Women’s Day, I sincerely hope that it marks the beginning of a new era in which the aspirations of all women in our country are realized as they shine before the world.
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Heat Index at Caution Level in the Sabaragamuwa, North-western and North-central provinces and in Colombo, Gampaha, Vavuniya, Mannar, Hambantota and Monaragala districts
Warm Weather Advisory issued by the Natural Hazards Early Warning Centre of the Department of Meteorology at 3.30 p.m. on 07 March 2026, valid for 08 March 2026.
Heat index, the temperature felt on human body is likely to increase up to ‘Caution level’ at some places in the Sabaragamuwa, North-western and North-central provinces and in Colombo, Gampaha, Vavuniya, Mannar, Hambantota and Monaragala districts
The Heat Index Forecast is calculated by using relative humidity and maximum temperature and this is the condition that is felt on your body. This is not the forecast of maximum temperature. It is generated by the Department of Meteorology for the next day period and prepared by using global numerical weather prediction model data.

Effect of the heat index on human body is mentioned in the above table and it is prepared on the advice of the Ministry of Health and Indigenous Medical Services.
ACTION REQUIRED
Job sites: Stay hydrated and takes breaks in the shade as often as possible.
Indoors: Check up on the elderly and the sick.
Vehicles: Never leave children unattended.
Outdoors: Limit strenuous outdoor activities, find shade and stay hydrated.
Dress: Wear lightweight and white or light-colored clothing.
Note:
In addition, please refer to advisories issued by the Disaster Preparedness & Response Division, Ministry of Health in this regard as well. For further clarifications please contact 011-7446491.
News
Lanka tea industry may lose $ 10-15 mn per week from ME war
The ongoing military conflict in the Middle East has adversely impacted on the Sri Lankan tea industry as the exporters are unable to supply tea to the region. The exporters estimate the revenue loss at about $ 10-15 million per week. The exporters have orders in hand for supply of tea and it is the logistical issues and war risk preventing them fulfilling such orders, the Tea Exporters Association (TEA) said in a statement.
“In order to mitigate the impact on the industry, the tea industry has jointly requested the government to support it in addressing the cash flow issue and consider absorbing a part of the additional freight and insurance charges. It has also requested government intervention to obtain the balance payment of about $ 50 million due on tea shipments already made to Iran under the barter deal,” TEA said on Friday.
The statement said approximately 52% of Sri Lanka’s tea exports reach the affected region mainly coming from the low grown area of the country dominated by tea smallholder farmers. According to 2025 tea export statistics, about 125 million kilograms of Ceylon tea were exported to the Middle East, with an estimated value of USD 750 million. The major importing countries of Ceylon Tea in the region include Iraq, Iran, Libya, Turkey, Saudi Arabia, Syria, and the United Arab Emirates. Though Libya and Turkey can be reached via Africa, the exorbitant freight charges have prevented the buyers in those countries from importing tea at the moment.
The supply routes to Middle East countries go via Strait of Hormuz and Red sea Suez Canal. Although there is no blockade on Suez Canal, due to the war risk both channels are currently not used by the major shipping lines. The tea exports to the region have almost come to a standstill due to the following reasons:
=All major shipping lines suspended their services to the region immediately after the outbreak of the conflict.
=Several seaports in the region were temporarily closed during the initial stages.
= Although a few shipping lines resumed limited operations from March 4, freight charges have
increased significantly by approximately USD 1,800 for a 20’ container and USD 3,000 for a 40’ container.
= Existing insurance coverage obtained by exporters is no longer valid.
=There is a lack of regular and scheduled vessels operating from Colombo to Middle Eastern destinations.
The tea exporters are experiencing serious cash flow constraints, as payments for shipments already
dispatched have been delayed due to the unsettled situation in the region. This has restricted exporters’
buying capacity and that was evident at this week’s tea auction, where overall prices declined by about Rs. 50/ per kg while low grown tea prices declined by about Rs. 75/ per kg.
If the situation continues for few more weeks it will have a serious impact on the tea auction as buyers may curtail the purchase of tea if the outward movements are restricted. This could directly impact on the income of the tea smallholder farmers.
In January 2026, the country earned $ 121.8 million from tea exports compared to $ 112.7 million in January 2025 (a 5% increase). The figures for February 2026 are not yet available but should be either similar to last year or higher. The disruption to tea exports in March will certainly affect the volume and value of the exports though the exact amounts cannot be estimated at this point.
According to the available data Sri Lanka has settled about 95% of its debt to Iran by supplying tea to Iran under the Tea for Oil mechanism. Even if the military conflict comes to an end, Sri Lanka will find it difficult to continue to supply tea to Iran unless a new mechanism is introduced. Under the prevailing US sanctions on Iran, the exporters may not be able to supply tea to Iran outside the barter system. Iran purchases about 11 million kg of tea from Sri Lanka annually under the barter deal.
The situation was discussed with the Minister of Plantation & Community Infrastructure at a meeting held on March 4, 2026.
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