Mar 15, Colombo: Despite the decline in exports last year, Sri Lanka's economy grew faster than analysts' forecasts, the data released today by the Census and Statistics Department showed.
The economic output of Sri Lanka as measured by GDP for the 4th quarter 2012 recorded a 6.3 percent growth after slumping to 4.8 percent in the previous quarter, the lowest in three years.
For the year, the economic output of Sri Lanka as measured by GDP expanded 6.4 percent, slightly lower than the 6.5 percent predicted by the Central Bank after the third quarter of 2012.
The tight monetary policies implemented earlier in the year to curb the trade deficit had stifled the economic growth and recognizing the result the Central Bank reduced the policy interest rates in December to boost economic growth and arrest the rising inflation.
In 2012, Agriculture sector grew the slowest at only 5.8 percent mainly due to the loss of paddy crops as a result of the severe drought that destroyed the paddy lands in the rice producing North Central and Eastern provinces.
Rubber exports declined by 6.8 percent as the global economic downturn affected the exports and exports of tea declined by 1.2 percent while coconut industry recorded a 6.0 percent growth. The production of minor crops and fishing industry contributed to the overall growth of the sector.
Industry sector recorded an overall growth of 10.3 percent mainly due to the growth in mining industry which recorded a 18.9 percent growth.
The services sector grew the slowest at 4.6.percent with Hotel and Restaurant sector contributing with a 20.2 growth.
The Central Bank predicts an expansion of 7.5 percent in economy this year. Sri Lanka recorded an impressive 8.3 percent economic growth for the year 2011.