Sri Lanka has long served as an important strategic destination in the Indian Ocean, catering to merchants and travellers from South-east Asia, India, the Middle East and East Africa. Formerly known as Ceylon, the island was visited and admired by the likes of Marco Polo, who called it “the finest island of its size in the world” well before the arrival of imperialist nations. A diverse colonial history, including influence from Portuguese, Dutch and British cultures, is visible across Sri Lanka today, as are its ancient Buddhist and Hindu traditions. While much of the country’s recent history has been tainted by a decades-long civil war, a post-conflict euphoria brought with it a sense of renewal and optimism. A coalition administration elected in 2015 pledged its commitment to inclusive governance and economic reform, a rebalancing of foreign policy and reconciliation with its ethnic minorities. However, the coalition has diverged on several key policy issues, leading to delays in the legislative agenda and culminating in a constitutional crisis that saw the prime minister removed from office by the president in October 2018, only to be reinstated two months later following a ruling by the country’s highest court.
Sri Lanka is a teardrop-shaped island in the Indian Ocean south-east of India and north-east of the Maldives, consisting of 65,610 sq km of land mass and 1340 km of coastline. Geologically it is considered an extension of the Indian peninsula, and it shares the same continental shelf. The majority of the island is made up of flat and rolling low-lying plains, gradually increasing in altitude from the coast, with periodic rocky buttes and mounds, some reaching elevations of more than 300 metres. A mountainous south-central interior is characterised by basins, valleys and escarpments, most spectacularly seen at the World’s End, a 1200-metre outcrop and viewing point. Located in the city of Nuwara Eliya, Pidurutalagala, or Mount Pedro in English, is the tallest mountain in Sri Lanka at 2524 metres. Other notable natural attributes include a vast biodiversity spread across jungle, forest and a variety of national parks. Most of the coastline is made up of sandy beaches and lagoons. Sri Lanka contains more than 100 rivers, most of which are small, seasonal rivulets present only during the monsoon rains. About 12 permanent rivers account for approximately 75% of the country’s annual water discharge.
There are two tropical Indian Ocean monsoons per year, which heavily influence the overall climate. The Yala Monsoon, which occurs between May and August, brings rainfall to the hill country, and the south and west coasts, while the Maha Monsoon, which takes place between October and January, affects the east and north coasts. Rainfall averages a minimum of 127 cm annually across the island, though the highlands can receive as much as 381 cm per year. While temperatures vary between the coastline and the mountainous interior, the island is categorised as largely tropical. Monthly averages in the lowlands fluctuate between 22°C and 33°C, while temperatures in the central highlands fall between 7°C and 22°C. Droughts lasting longer than three months, floods and landslides are the most common natural disasters in the country.
Sri Lanka possesses sizeable deposits of graphite, limestone, mineral sands, phosphate and clay. Sri Lanka also has more than 70 of the world’s 200 varieties of coloured gemstones, making it one of the most important gem-bearing nations in the world. Of its land mass, 20.7% is arable, while 15.8% is set aside for permanent crops and 7% for permanent pasture. Both regional plantation companies and smallholders grow tea, rubber, and to a lesser extent, coconuts and palm oil. In energy, the country hosts blocks of unexploited natural gas deposits in the Mannar Basin off the west coast of the island, not to mention hydropower generation from its network of rivers.
According to the Census of Population and Housing, last conducted in 2012, 74.9% of Sri Lanka’s 20.3m people are ethnic Sinhalese, concentrated in the island’s south and interior. Tamils comprise 15.4% of the population, split between Sri Lankan Tamils and Tamils of Indian origin – colloquially referred to as “upcountry” Tamils. The remaining population is made up of Sri Lankan Moors, Burghers (descendants of the original Dutch and Portuguese settlers), Malay, Sri Lankan Chetty and Veddhas. Updated estimates place the population at approximately 21.9m in October 2018, while the growth rate in 2017 stood at 1.1%. The commercial capital Colombo and its surrounding district are home to about 2.3m people. Other major population centres include Galle, Kandy, Jaffna and Trincomalee. Based on a 2012 World Bank study, the population is steadily ageing, contrary to many nations in South Asia. By 2041, one in four Sri Lankans are expected to be over the age of 60, up from one in eight in 2012. According to official statistics, 18.4% of Sri Lankans were living in urban areas in 2017.
Language has long been a divisive issue, particularly in the lead-up to the 25-year civil war. Under the 1978 Sri Lankan constitution, both Sinhala, of Indo-Aryan origin, and Tamil, of Dravidian origin, were cited as national languages. English – the official language of civil servants during the British colonial era – is spoken conversationally by around 10% of the population, and is still commonly used in government and referred to in the constitution as a “link language”.
Religion & Culture
According to the 2012 census, 70.1% of Sri Lankans practise Buddhism, with the Sinhalese population accounting for most of these followers. The island nation is characterised by an orthodox school of Buddhism, called Theravada Buddhism, which has literary traditions in the Pali language, also prevalent in Myanmar and Thailand. An additional 12.6% of the population practises Hinduism and 9.7% Islam. The majority of the Tamil population is Hindu, with a smaller concentration of Muslims, who are mostly descendants of Arab traders. A further 7.6% of the country is Christian, largely skewed towards Roman Catholic, and the remaining 1% is made up of other religions. Sri Lankan culture is heavily influenced by its colonial history, long-standing ties with the Indian subcontinent, and its Buddhist and Hindu religious origins. There are six cultural UNESCO World Heritage sites on the island, including the Ancient City of Sigiriya, the Old Town of Galle and its fortifications, the Golden Temple of Dambulla and the Ancient City of Polonnaruwa.
The country is closely associated with the sport of cricket, in which it ranks as one of the world’s top test nations. The sport is followed across the island by a substantial portion of the population.
GDP at current prices reached LKR13.3trn ($83.8bn) in 2017. Driven largely by consumption, 56.7% of GDP stems from services, 26.9% from industry, and 6.8% from agriculture, forestry and fishing, according to information from the Central Bank of Sri Lanka. In the first nine months of 2018 GDP expanded by 3.3% year-on-year to stand at LKR6.9trn ($43.5bn). There is a developing ICT ecosystem with a range of technology-based services, and the country is working to boost IT exports and business process outsourcing, the latter of which is already burgeoning, accounting for 6.4% of total exports in 2017. Though lacking indigenous raw materials, the manufacturing of quality garments has grown to be Sri Lanka’s most important trade item, making up 42.6% of total exports in 2018. Other notable exports include tea and spices, which account for 15.2%; rubber-based products (7.8%); coconut-based products (5.1%); and seafood (2.3%). With a diverse range of destinations on offer, including beaches, highlands and ancient cities, the post-civil war era has brought an increase in tourism, traditionally driven by Western markets, but more recently by East Asia. The total number of tourist arrivals in 2017 stood at 2.1m.
Sri Lanka’s debt-to-GDP ratio reached 77.6% in 2017. Debt-service payments – coupled with an expansive public sector – have contributed to rising budget deficits, estimated at 5% of GDP in 2018. Declining tax collection was an ongoing concern, with tax revenue as a percentage of GDP falling from above 20% in the early 1990s to 11.5% in 2017. However, the introduction of a new tax code in 2018 has helped to boost tax collection.
This is in conjunction with a growing trade deficit, which reached $8.9bn in the first 10 months of 2018, up 16.7% year-on-year due to higher imports and marginal export growth. While lower revenue can be an obstacle for the public budget, the high level of remittances from Sri Lankan workers abroad – $7.6bn in 2018, or 8.1% of GDP, according to the World Bank – continues to help counter many of these challenges.
The Democratic Socialist Republic of Sri Lanka gained independence from the UK in 1948. In 1978 the island nation ratified its constitution, which serves as the governmental framework for the executive, legislative and judicial branches. The executive branch consists of a president, a prime minister and a Cabinet. The president functions as head of state, head of government and commander-in-chief of the armed forces, and retains the ability to dissolve the Parliament. The prime minister is appointed by the president, and together they choose a Cabinet. The president is directly elected by preferential majority popular vote and can hold office for a maximum of two, six-year terms. The legislative branch consists of a 225-seat, unicameral Parliament, which also serves terms of six years. Of the seats, 196 are directly elected into multi-seat constituencies, while 29 are allocated to political parties as a share of the national vote. To qualify for a parliamentary seat, a party must secure 5% of the vote. Voting is done on a preferential basis, choosing from three candidates.
Citing policy differences, on October 26, 2018 President Maithripala Sirisena relieved Prime Minister Ranil Wickremesinghe of his position and replaced him with the former president, Mahinda Rajapaksa. Although Prime Minister Wickremesinghe seemingly still held the backing of a majority of parliamentary deputies, the government came to a complete standstill when President Sirisena dissolved the Parliament on November 9, 2018. The following month the Supreme Court ruled the dissolution of the Parliament illegal, and Rajapaksa subsequently resigned from the post, ending a seven-week crisis. On December 16, 2018 President Sirisena reinstated Wickremesinghe as prime minister.
Elections are largely considered to be free and fair; however, contested results have led to several changes of power. The more conservative United National Party and the liberal-leaning Sri Lanka Freedom Party have been at the forefront of politics since the country achieved independence. However, in the local government elections held on February 10, 2018, the Sri Lanka Podujana Peramuna secured the most seats and local authorities, positioning itself as the favourite party for the next round of national elections. Despite the recent constitutional crisis, the next election has been scheduled to be held between November 2019 and January 2020, and according to local media, President Sirisena does not intend to move this date further forward. The Buddhist clergy and labour unions maintain influence in political dialogue and decision-making as well.
The Supreme Court of the Republic is the highest-ranking court, made up of a chief justice appointed by the president and a maximum of 10 other justices. Below it sits a court of appeals, high courts, municipal courts and primary courts, along with a number of tribunals. There are 54 judicial districts in Sri Lanka. Its legal system is a combination of RomanDutch civil law and a number of customary indigenous laws, including Kandyan Law and Thesawalamai Law, which are largely applicable to personal affairs. The executive and judicial capital of Sri Lanka is its main urban centre of Colombo, while Sri Jayewardenepura Kotte, a suburb of the city, serves as the legislative capital and the location of the Parliament. The country is further divided into second-tier provincial councils and third-tier local governments. While the Ministry of Local Government and Provincial Councils is responsible for national policy-making, the provincial and local authorities are largely responsible for implementation.
The 13th amendment to the constitution – the Provincial Councils Act No. 42 of 1987 – legislates this political devolution to nine provincial councils, further broken down into 25 districts and 329 divisional secretariats. Their responsibilities include law and order, economic planning, education, housing, agriculture, land use and cooperative development. The supervision of local government is delegated to provincial councils. Each province has a governor who executes policies through a board of ministers and is appointed by the president to a five-year term.
Subsequently, there are 335 local government authorities, with 23 municipal councils for cities and larger towns; 41 urban councils covering smaller towns and less urbanised areas; and 271 rural pradeshiya.
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