IPS Launches Sri Lanka: State of the Economy 2025 Report

“Digitalisation can help steer Sri Lanka’s current recovery toward more sustained, structural growth,” said Dr Dushni Weerakoon, the Executive Director of the Institute of Policy Studies of Sri Lanka (IPS) during her presentation on the overview of the Sri Lankan economy, at the launch of Sri Lanka: State of the Economy 2025 report. This report is IPS’ annual flagship publication compiled to inform policymakers and other stakeholders on economic trends and opportunities to pursue economic growth. This year’s report on “Technology for Change: Driving the Digital Economy,” examines how digital transformation can accelerate Sri Lanka’s post-crisis economic recovery and reshape the country’s development trajectory.

Dr Weerakoon noted that Sri Lanka’s economy is in a cyclical recovery phase, driven by renewed investor and consumer confidence. The IPS report highlights that Sri Lanka’s Gross Domestic Product (GDP) growth reached 4.9 percent in the first half of 2025, supported by improved macroeconomic fundamentals. She emphasised that maintaining this growth will require enhanced productivity and efficiency, structural reforms in land and labour markets, greater openness to trade and investment, investment in education and skills development, and the simplification of taxes and regulations.

Dr Nisha Arunatilake, Director of Research at IPS, also presented key insights from the report, exploring five priority areas where digitalisation can drive growth and strengthen resilience. Highlighting the way forward for Sri Lanka’s digital economy, Dr Arunatilake underscored how technology and innovation can foster stability, human capital development, entrepreneurship, and resilience, laying the foundation for long-term growth and inclusion.

Delivering the keynote address, Dr. Hans Wijayasuriya, Chief Advisor to His Excellency the President on Digital Economy and the Chairman of the Information and Communication Technology Agency (ICTA), emphasised the transformative potential of digitalisation in Sri Lanka’s development agenda. He outlined the government’s digital economy strategy and stressed the importance of public-private collaboration to scale digital infrastructure, build skills, and expand access to digital services across the country.

The event which was held on 15 October 2025, concluded with an engaging question and answer session, where participants discussed digital inclusion, data governance, and the role of education and entrepreneurship in a technology-driven economy. The evening wrapped up with a networking reception, bringing together policymakers, researchers, development partners, and private sector leaders.

The Sri Lanka: State of the Economy 2025 report is now available for sale at the following bookshops:

• Vijitha Yapa: 5th Lane, Horton Place, Kohuwala, Galle, and Matara branches
• Expographic: Pelawatta and Havelock City Mall branches