Impact of COVID-19 on the Sri Lanka Economy

Abstract

This study focuses on tracing the early economic impacts of COVID-19. The pandemic has unleashed a global shock impacting all economies in several ways. The lockdowns have brought economic activity to a standstill, with the closure of businesses and halting of travel, trade and commerce. Even as the impact on sensitive sectors as trade, tourism and remittances are already becoming visible, it is imperative to understand how these are impacting economies in Asia. This article studies these impacts on Thailand and Sri Lanka, both of which being wired to the globalized world, are witnessing adverse impacts on earnings through exports and tourism as well as a huge decline in inward remittances. Even as countries beef up their health infrastructure, they also seek to restart international travel and trade. Hence, the role of the state is critical to pull the economies out of the deglobalization trends that are expected to gain pace in and beyond 2020. This section discusses how the first wave of COVID-19 pandemic affects the various components of exports and imports of Sri Lanka. The impact on the industrial/ manufacturing sector exports and its major components such as export of textile and garment products, petroleum products and rubber products based on the availability of monthly data are examined. The impact on exports of tea, rubber, coconut and total agricultural exports and components of imports is also analysed separately.This review paper the economic impact of covid-19 on Sri Lankan economy and the specific objectives are to identify the outbreak on the key economic income earning sector such as tourism, food and agriculture, exports of apparels and textiles and small and medium scale enterprises and reinvigorate the Sri Lankan economy.