OVERVIEW

Sri  Lanka  experienced  diverse  economic  policies  during  different  stages:  prior  to  the

colonization (before 1505), colonial period (1505  – 1948), after the independence (1948 –

1977) and economic liberalization, and its aftermath (1977 – to date). Prior to colonization,

Sri Lanka experienced self-sufficient economic system which categorize as a mercantilism

international trade policy, and the country was a main international trade hub in the Indian

Ocean. However, during the colonial period, Sri Lankan economy was influenced to shift to

an export and  import economy discarding  the self-sufficient economic system. The export

and import economic policy has both advantages and disadvantages. In Sri Lanka, however,

export and  import economy led  to unsymmetrical export portfolio  which has continuously

earned  deficit  trade  balances.  After  1977,  Sri  Lanka  followed  an  advanced  export

diversification policy, which  promoted more  industrial products. However,  due to  lack of

backward  industries  and  inherent  weaknesses  in  export  sector,  Sri  Lanka  continues to

encounter issues in its international trade which demonstrated macroeconomics instability.

Sri Lanka Exchange Rate against USD averaged 196.881 (LKR/USD) in Mar 2021, compared with 194.295 LKR/USD in the previous month. Sri Lanka Exchange Rate against USD data is updated monthly, available from Jan 1957 to current months in 2021. The data reached an all-time high of 196.881 in Mar 2021 and a record low of 4.762 in Nov 1967. It’s current stable currency not depreciating against the dollar causes Sri Lanka to have potential currency disadvantage in labor rates and harvesting costs of component materials.

Federal Reserve Board provides average Exchange Rate against USD. Exchange Rate against USD prior to January 1973 is sourced from the International Monetary Fund. Its Long Term Interest Rate (Govt Paper: Primary: Yield: WA: Bonds: Above 10 Years) was reported at 10.680 % pa in Oct 2019. The cash rate (Policy Rate: Month End: Standing Deposit Facility Rate (Repo Rate)) was set at 4.500 % pa in Apr 2021.

The structure of Sri Lankan exports and thereby, its economy even after forty five

years  of  liberalization  is  still  a  long  distance  away  from  innovation  and  technological

advancements.  

We hope that the Sri Lanka labor force and indigenous wood resources can create a competitive edge for the Yard Walls and NewSand llc product lines to be manufactured.