Economic Development Strategy
The economic development strategy aims to accelerate economic growth to take the country rapidly towards upper middle income status by 2020 while promoting efficiency in the use of resources and promoting social equity. This strategy involes five main goals of development, namely,
1. Generating one million employment opportunities
2. Enhancing income levels
3. Development of rural economies
4. Ensuring land ownership to rural and estate sectors, the middle class and government employees
5. Creating a wide and a strong middle class
Main Components of the Economic Strategy
Indicative Macroeconomic Targets 2020
The main planning indicators for the four year period are indicated in the Table 1. The GDP growth rate will be increased to 7 percent in 2020 from the existing rate of 4.8 percent. The GDP will be increased to US$ 125 billion and GDP per-capita will be increased to US$5,797 by 2020. This will earmark the achievement of Upper Middle Income economic status by Sri Lanka.
Table 1: Indicative Macroeconomic Targets 2020 (% of GDP) |
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Indicator |
2015 Estimate |
Projections |
||||
2016 |
2017 |
2018 |
2019 |
2020 |
||
GDP Growth Rate |
4.8 |
5.5 |
6.0 |
6.5 |
7.0 |
7.0 |
Investment |
30.1 |
30.1 |
30.3 |
31.0 |
31.5 |
31.5 |
Private Investment |
24.7 |
26.0 |
25.1 |
25.6 |
25.8 |
25.8 |
Public Investment |
5.4 |
4.1 |
5.2 |
5.4 |
5.6 |
5.7 |
Total Expenditure |
21.0 |
18.9 |
20.2 |
20.3 |
20.4 |
20.4 |
Revenue and Grants |
13.5 |
13.5 |
15.5 |
16.0 |
16.4 |
16.9 |
Current Account Balance |
-2.2 |
-1.6 |
0.5 |
1.1 |
1.6 |
2.2 |
Budget Deficit |
-7.5 |
-5.4 |
-4.6 |
-4.3 |
-4.0 |
-3.5 |
Domestic Savings |
22.6 |
23.2 |
23.8 |
25.0 |
25.9 |
26.4 |
Source: Department of National Planning |
Sectoral Investment 2017-2020
The annual breakdown of the public investment during the 2017-2020 period is indicated under eight main sectors in the Table 2. Accordingly, the public investment is to be maintained at a level of 5.5 percent of the GDP during the reference period.
Table 2 : Sectoral Investment 2017-2020 (Rs. Billion) |
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Sector |
2017 Budget |
Projections |
2017-2020 Cumulative |
As a % of Total |
|||
2018 |
2019 |
2020 |
|||||
1. Human Resource Development |
153.5 |
173.3 |
200.4 |
229.1 |
756.3 |
21.4 |
|
o/w Education |
99.1 |
111.4 |
129.1 |
148.3 |
487.8 |
13.8 |
|
Health |
43.6 |
50.3 |
58.9 |
67.6 |
220.5 |
6.2 |
|
2. Agriculture |
35.6 |
45.7 |
46.1 |
53.2 |
180.6 |
5.1 |
|
o/w Livestock |
6.2 |
12.7 |
6.3 |
7.6 |
32.8 |
0.9 |
|
Plantation |
8.3 |
9.5 |
11.1 |
12.7 |
41.5 |
1.2 |
|
Fisheries |
6.0 |
7.0 |
8.2 |
9.4 |
30.5 |
0.9 |
|
3. Industry, Trade, Investment and Tourism |
87.4 |
89.7 |
94.0 |
98.6 |
369.7 |
10.5 |
|
4. Infrastructure |
268.4 |
327.6 |
412.8 |
479.3 |
1,488.1 |
42.1 |
|
o/w Roads |
116.1 |
144.0 |
201.0 |
247.0 |
708.1 |
20.1 |
|
Land Transport |
35.0 |
40.4 |
47.3 |
54.3 |
176.9 |
5.0 |
|
Ports and Aviation |
1.3 |
2.2 |
3.0 |
3.5 |
10.0 |
0.3 |
|
Water Supply and Sewarage |
26.7 |
38.7 |
42.0 |
45.4 |
152.7 |
4.3 |
|
5. Good Governance |
72.1 |
81.6 |
91.0 |
94.3 |
338.9 |
9.6 |
|
6. Environmental Management |
9.2 |
10.6 |
12.3 |
14.2 |
46.3 |
1.3 |
|
7. Social Protection |
13.9 |
11.7 |
8.3 |
7.5 |
41.5 |
1.2 |
|
8. Regional Development |
68.8 |
73.8 |
79.0 |
88.1 |
309.7 |
8.8 |
|
Grand Total |
708.8 |
814.0 |
943.9 |
1,064.2 |
3,530.9 |
100.0 |
|
Source: Department of National Planning |
Sectoral Investment by Type of Project 2017-2020
The Table 3 shows the allocation of total investment according to the type of project i.e. public investment in terms of ongoing projects, annual programmes and new projects. Accordingly, the ongoing projects receive the highest investment allocation of 51 percent. The allocation for the annual programmes and new projects is 22 and 27 percent respectively.
Table 3 : Sectoral Investment by Type of Project 2017-2020 (Rs. Billion) |
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Sector |
Type |
2017 Budget |
Projections |
2017 - 2020 Cumulative |
||
2018 |
2019 |
2020 |
||||
Human Resource Development |
Ongoing |
89.2 |
80.8 |
84.7 |
84.2 |
339.0 |
Annual |
21.3 |
40.7 |
46.8 |
54.3 |
163.2 |
|
New |
43.0 |
51.7 |
68.9 |
90.6 |
254.2 |
|
Agriculture |
Ongoing |
8.7 |
12.4 |
8.5 |
8.8 |
38.3 |
Annual |
15.2 |
15.3 |
18.2 |
19.4 |
68.2 |
|
New |
11.7 |
18.0 |
19.4 |
25.0 |
74.1 |
|
Industry, Trade, Investment & Tourism |
Ongoing |
39.3 |
39.2 |
42.0 |
44.1 |
164.6 |
Annual |
14.5 |
16.8 |
17.3 |
17.8 |
66.4 |
|
New |
33.6 |
33.8 |
34.7 |
36.7 |
138.8 |
|
Infrastructure |
Ongoing |
196.8 |
192.0 |
247.2 |
268.8 |
904.8 |
Annual |
55.2 |
79.7 |
74.8 |
77.4 |
287.1 |
|
New |
16.4 |
55.8 |
90.8 |
133.1 |
296.2 |
|
Good Governance |
Ongoing |
47.1 |
56.4 |
64.1 |
66.9 |
234.5 |
New |
24.9 |
25.3 |
26.8 |
27.5 |
104.5 |
|
Environment |
Ongoing |
3.9 |
4.5 |
4.5 |
4.0 |
16.9 |
Annual |
4.2 |
3.7 |
3.7 |
5.8 |
17.4 |
|
New |
1.1 |
2.3 |
4.1 |
4.4 |
11.9 |
|
Social Protection |
Ongoing |
10.4 |
5.9 |
3.9 |
3.0 |
23.3 |
Annual |
2.0 |
2.8 |
2.7 |
2.7 |
10.3 |
|
New |
1.6 |
2.9 |
1.7 |
1.7 |
7.9 |
|
Regional Development |
Ongoing |
33.4 |
21.8 |
19.0 |
7.9 |
82.0 |
Annual |
18.8 |
36.6 |
48.1 |
64.1 |
167.6 |
|
New |
16.6 |
15.4 |
11.9 |
16.1 |
60.1 |
|
Allocation by Type of Project |
Ongoing |
428.8 |
413.0 |
473.9 |
487.7 |
1,803.4 |
Annual |
131.2 |
195.6 |
211.6 |
241.5 |
779.9 |
|
New |
148.9 |
205.2 |
258.3 |
335.1 |
947.5 |
|
Grand Total |
|
708.8 |
814.0 |
943.9 |
1,064.2 |
3,530.9 |
Source: Department of National Planning |
Public Investment Programme - Targets 2020
The sectoral targets 2020 are indicated in the Table 4.
Table 4: Public Investment Programme - Targets 2020 |
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Indicator |
2015 |
2020 |
Human Resource Development |
||
Survival Rates (Grade 1-11) (%) |
86 |
100 |
Qualified for G.C.E. (A/L) subject streams from G.C.E (O/L) (%) |
69.33 |
80 |
Eligibility for University Entrance from G.C.E. (A/L) (%) |
62.35 |
80 |
New admission to state universities |
25,676 |
50,000 |
New admissions to Skills Education |
182,829* |
350,000 |
Youth unemployment rate (%) |
20.7 |
14.1 |
Female labour force participation rate (%) |
36 |
40 |
Digital Literacy (%) |
25* |
40 |
IT/BPO export revenue (USD Million) |
910* |
5,000 |
Maternal mortality rate (per 100,000 live births) |
34.2 |
25 |
Infant mortality rate (per 1,000 live births) |
8.0 |
6.0 |
Premature deaths due to NCDs (<65 years) (%) |
18 |
9 |
Agriculture |
||
Export revenue from selected agricultural exports such as fruits, vegetables, cut flower and foliage, spices and other export crops (USD Billion) |
0.5 |
1 |
Export earnings of Tea, Rubber and Coconut (Rs. Billion) |
295.3* |
565.5 |
Total irrigable extent (Hectares) |
744,983 |
850,000 |
Self-sufficiency in liquid milk (%) |
44 |
100 |
Industry, Trade, Investment and Tourism |
|
|
Employment in industry sector (Million) |
2 |
3 |
Industry contribution to GDP |
28.5 |
30 |
Export earnings (USD Billion) |
11.1 |
20 |
High tech exports (%) |
1 |
5 |
Tourist arrivals (No. million) |
1.79 |
4.5 |
Tourism income (USD billion) |
2.92 |
10 |
Infrastructure |
|
|
Share of railway passenger transport (%) |
5 |
10 |
Total container traffic (TEUs ‘000) |
5.2 |
6.8 |
Share of electricity generation from non-conventional renewable energy sources |
11 |
20 |
Reduce volume of runoff water (MCM) |
28,000 |
21,500 |
Safe drinking water coverage (%) |
86 |
100 |
Sanitation coverage (%) |
87 |
100 |
Environment |
|
|
Forest cover (%) |
29 |
32 |
*Data pertaining to 2014 Source: Department of National Planning |
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