Flag description: yellow with two panels; the smaller hoist-side panel has two equal vertical bands of green (hoist side) and orange; the other panel is a large dark red rectangle with a yellow lion holding a sword, and there is a yellow bo leaf in each corner; the yellow field appears as a border that goes around the entire flag and extends between the two panels
Economy
Economy - overview: Industry - dominated by the fast-growing apparel industry - has surpassed agriculture as the main source of export earnings. The economy has been plagued by high rates of unemployment since the late 1970s. Economic growth accelerated in 1991-95 as domestic conditions began to improve and conditions for foreign investment brightened. In 1996, however, a drought, slow economic reform, and civil war exacted a heavy economic toll. Insufficient monsoon rains caused power cuts that hurt industrial and agricultural production, and the stepped-up Tamil insurgency reduced foreign investment and tourism - two key sources of foreign exchange. Meanwhile, Colombo's counterinsurgency efforts caused defense expenditures to overshoot budget targets by 42%. In 1997, agricultural production should recover from the effects of last year's drought, but industry will still be hampered by high real interest rates, slow improvement in foreign investment inflows, and stalled progress on privatization. The government's main challenge this year will be to curb defense and social welfare spending to cut the budget deficit as a percentage of GDP in half by 1998, as stipulated in its deficit reduction program.
GDP: purchasing power parity - $69.7 billion (1996 est.)
GDP - real growth rate: 3.7% (1996 est.)
GDP - per capita: purchasing power parity - $3,760 (1996 est.)
GDP - composition by sector: agriculture: 23.8% industry: 24.7% services : 51.5% (1994)
Inflation rate - consumer price index: 15.9% (1996)
Labor force: total: 6.2 million (1994) by occupation: agriculture 42%, services 40%, industry 18% (1994)
Unemployment rate: 13.1% (1994)