Sri Lanka’s digital economy to see a fourfold growth by 2030
The Morning: Sri Lanka’s digital economy is headed towards growing four times its current size, to contribute $ 15 billion dollars to the country’s gross domestic product, Federation of Information Technology Industry Sri Lanka (FITIS) Chairperson Dayan Rajapaksha told media recently.
“The last survey done on the contribution of the Digital economy to the GDP, it was $ 3.7 billion,” Rajapaksha said. “We were comparing this with other economies, and we realized how low this percentage was,” he further added.
“This is actually a very ambitious target, and this is not something we can single handedly do.”
According to President’s Chief Advisor on Digital Economy Dr. Hans Wijayasuriya, Sri Lanka could generate $ 5 billion annually from digital by 2030. He made these remarks during his address at the launch of the Sri Lanka Digital Public Infrastructure Summit in February.
“In an $ 80-90 billion economy, this represents a significant percentage of growth.”
Sri Lanka’s current GDP value stands at $ 98.96 billion, or $ 342.6 billion when measured by purchasing power parity.
He also noted that Sri Lanka could see an additional 1-2% rise in its compound annual growth rate (CAGR) annually by fully embracing digitisation, on top of its baseline GDP growth of 2-3%, and if digital exports reach the aforementioned levels, this 1-2% boost to GDP could double.
“As digitisation penetrates deeper into the economy, the growth uplift could range anywhere between one to two CAGR points,” Wijayasuriya said. “An economy with a business-as-usual growth rate of 3-4%, or even starting from a lower base, could aspire to achieve an additional two to three points of GDP growth through digitisation.”
Wijayasuriya also highlighted the need to minimise the costs of doing business digitally.
“We won’t stop at absolute targets because, in the digital realm, we are competing globally and regionally. Digital is open, and we can’t rely on the strength of being an island. Once we open up, national competitiveness – and its correlation with the maturity of our digital systems and readiness – will come to the forefront,” Wijayasuriya said.
Sri Lanka is looking forward to taxing digital service providers who are located in foreign countries and provide a service through an electronic platform to Sri Lankan consumers.
More specifically those with revenues from such services exceeding Rs. 60 million would be liable to register, collect, and remit 18% VAT to the IRD.
OSL take:
Sri Lanka’s ongoing economic expansion and target of becoming a hub in the South Asian region have all resulted in the overall expansion of the country’s digital industry. This is evident by the digitization drive launched by the Sri Lankan government to cover both state and private sectors in all key economic sectors. The Sri Lankan government is committed to transforming the country into an e-economy and the need to be on par with the fast-evolving global digital industry has opened a host of business/investment opportunities in Sri Lanka’s digital industry in related sectors. There are many business/investment opportunities in the ICT and digital infrastructure development sectors. The growth, profits as well as expansion of businesses already engaged in Sri Lanka’s digital industry and related sectors are clear indications of the increasing business potential in the industry. Foreign businesses/investors could therefore explore the expanding business/investment opportunities in Sri Lanka’s digital industry and related sectors while also looking at further expansion of operations through local collaborations.
| Article Code : | VBS/AT/20250909/Z_1 |