COLOMBO (Reuters) – Sri Lanka’s economic growth is expected to slump to a near two-decade low this year, a Reuters poll showed, as tourism, foreign investment and overall business activity eased sharply in the wake of the devastating Easter Sunday bombings.
Security in Sri Lanka has been ramped up since the April 21 attacks by Islamic militants, who killed over 250 people including 42 foreign nationals in churches and hotels across the country. Tourism, which accounts for 5 percent of the country’s gross domestic product, has suffered as travelers from around the globe canceled hotel and flight bookings fearing more attacks.
Islamic State has claimed responsibility for the attacks.
The poll of 10 analysts predicted that the full-year median economic growth could slide to 2.5 percent, its lowest since 2001, when the Indian Ocean island’s growth contracted after Tamil Tiger rebels attacked the country’s main airport.
That compares with gross domestic product growth of 3.2 percent in 2018, the weakest in 17 years as a weeks-long political crisis and past policy tightenings sapped business confidence and cooled investment.
Some of the analysts in the poll are forecasting a contraction in the second quarter.
Many analysts said their revised growth figures were only a preliminary estimate as they are yet to incorporate all of the latest available data in their economic models.
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