Economic Transformation Act 2024 · As enacted · Part I
4. Duty of the Cabinet of Ministers in relation to the National Policy on Economic Transformation
Official English translation. Where it differs from the Sinhala or Tamil text, the Act itself says which text prevails.
Official translationFrom Department of Government Printing, unchanged
It shall be the duty of the Cabinet of Ministers charged with the direction and control of the Government of Sri Lanka under Article 43 of the Constitution, to base the National
Policy on Economic Transformation on the following targets: -
Gross Domestic Production growth to reach-
five per centum annually by the year 2027;
and
above five per centum annually thereafter;
Explanation
The year 2027 will mark five years since the beginning of the crisis. Sri Lanka’s positive recovery shall enshrine a full economic recovery by the year 2027. The economic growth shall be accelerated to above five per centum after the year 2030 to achieve an Advanced Economy status by the year 2048.
unemployment to reach below five per centum of the labour force from the year 2025;
Explanation
Unemployment rates in Sri Lanka have typically been low and a target rate of five per centum locks this in.
Female Labour Force Participation to reach-
not less than forty per centum by the year 2030; and
not less than fifty per centum by the year 2040;
Explanation
Measures to increase Female Labour Force Participation may significantly increase labour productivity and growth in the economy.
current account deficit of the balance of payments shall not exceed one per centum of Gross Domestic
Production annually;
Explanation
Persistent current account surpluses may help Sri Lanka manage its external debt service obligations on a sustainable basis. However, in case of a current account deficit in a given year, this deficit shall be limited to less than one per centum of Gross Domestic Production.
exports of goods and services as a percentage of
Gross Domestic Production to reach-
not less than twenty-five per centum of Gross
Domestic Production by the year 2025;
not less than forty per centum of Gross
Domestic Production by the year 2030; and
sixty per centum of Gross Domestic
Production by the year 2040;
Explanation
A target of forty per centum of Gross Domestic Production by the year 2030 is needed to convert Sri Lanka from an inward-oriented economy to an outward-oriented economy.
Net Foreign Direct Investment as a percentage of
Gross Domestic Production to reach-
not less than five per centum of Gross
Domestic Production by the year 2030; and
at least forty per centum of Net Foreign Direct
Investment to be in exports of goods or exports of services by the year 2030;
Explanation
Shift to export-oriented Foreign Direct Investment in order to support the growth of non-debt creating inflows to the economy.
Primary Balance in the Government Budget to reach two decimal three per centum of Gross Domestic
Production until the year 2032 and at least two per centum of Gross Domestic Production from the year 2032 onwards;
Explanation
In order to prevent the recurrence of such an economic crisis, it is essential to ensure that a primary surplus of at least two per centum of Gross Domestic Production is maintained in the Government budget.
Government revenue to reach at least fifteen per centum of the Gross Domestic Production beyond the year 2027; and
Explanation
To maintain robust domestic resource mobilization.
multi–dimensional poverty headcount ratio to be less than fifteen per centum by the year 2027 and less than ten per centum by the year 2035.
Explanation
The reduction of multi-dimensional poverty (including education, health, housing and access to basic services) to promote inclusive growth through economic transformation.