Sri Lanka’s economic growth set to slow to 3.5% in 2025 amid structural and global Challenges

Sri Lanka’s economic growth is projected to decelerate to 3.5 percent in 2025, according to the World Bank (WB), as the country contends with persistent structural constraints, global economic pressures, and unresolved trade policy uncertainties. 

This marks a slowdown from 2024’s stronger-than-expected 5 percent expansion, which was driven by a resurgence in industrial output and tourism-linked services.  

While Sri Lanka’s economy outperformed forecasts in 2024—surpassing the World Bank’s initial 4.4% growth estimate—the momentum is expected to weaken next year.