A World Bank (WB) report states that South Asia remains the fastest growing emerging market and developing economy region in the world.
In fact, growth is now on track to be higher than anticipated six months ago, helped by strong domestic demand in India and faster recoveries in most other South Asian countries.
“Sri Lanka’s recent economic stabilisation, marked by four quarters of growth and a current account surplus in 2023, is a significant milestone,” said David Sislen, World Bank Regional Country Director for Maldives, Nepal, and Sri Lanka on Thursday in Colombo.
“Sri Lanka’s growth is excepted to reach 4.4% in 2024,” he said.
Looking ahead, the report projects a modest growth of 3.5% in 2025. Growth is then expected to follow a modest path over the medium term due to the scarring effects of the economic crisis. Poverty is expected to gradually decline but remain above 20 percent until 2026. Inflation is likely to stay below the central bank’s target of 5 percent in 2024, gradually increasing as demand picks up. The current account is projected to remain in surplus in 2024, driven by tourism and remittances.
The World Bank says that South Asia could still grow faster.
“Our latest South Asia Development Update focuses on two areas of untapped potential: the integration of more women into the region’s workforce, to benefit from the progress made in access to education, and greater openness to investment and trade, to benefit from the rearrangement of global value chains currently underway.”
“No economy can realize its full potential when half its population is hindered from realising their own.”
South Asia has made remarkable progress in establishing equality of access to educational opportunities for women and men, but too many women in the region stay out of the labor force after graduation or following marriage.
Only one-third of working-age women in the region currently participate in the workforce. This is well below the three-quarters of South Asian men in the labor force and the 54 percent average for women in emerging markets and developing economies.
Unsafe transport, lack of childcare, and limited freedom of movement impede South Asian women’s social and economic mobility and confine many to informal-sector roles with poor remuneration.
Legal frameworks in South Asian countries — from business registration processes to inheritance laws — are among the least favourable to working women globally.
