Sri Lanka’s major industries play a crucial role in shaping the nation’s identity and contributing significantly to its economic growth. In this article, we delve into the key sectors that have not only defined Sri Lanka’s past but continue to drive its present and future. Sri Lanka’s economic tapestry is woven with the threads of tea, gems, rubber, coconut, and tourism. From the lush tea estates in the central highlands to the vibrant gemstone trade and the expansive coconut groves, these industries form the cornerstone of the nation’s economic vitality, reflecting its rich history and natural abundance.
Major Industries in Sri Lanka
Tourism stands as a vital sector in Sri Lanka, experiencing rapid growth over the years. The island has been a sought-after destination for international travellers for centuries, earning recognition from historical figures like Marco Polo and Chinese traveller Fa-Hien. The government’s efforts to boost tourism trace back to 1937 with the establishment of the Ceylon Tourism Bureau, temporarily closed during World War II and reopened post-independence. Presently, the country’s key attractions encompass stunning beaches, resorts, and ancient heritage sites. Additionally, the mining of precious stones, such as sapphires and rubies in Ratnapura, serves as a significant draw for tourists.
Although setbacks like the civil war and the 2004 tsunami impacted tourism, there has been a resurgence since 2008. Post-civil war, tourist arrivals surged from 448,000 in 2009 to 1,798,380 in 2015. Notably, a substantial number of visitors in 2018 hailed from India (424,887), China (265,965), and the United Kingdom (254,176). Domestic tourism has also seen substantial growth, with over 6 million locals exploring their own country. The reasons for this surge in domestic tourism include sightseeing, academic pursuits, family holidays, and pilgrimages.
In 2013, tea production made up 2% of Sri Lanka’s GDP, contributing around $1.5 billion and standing as a significant source of foreign exchange for the country. The tea industry plays a crucial role in employment, directly or indirectly supporting over a million individuals, with more than 215,338 people engaged in tea estates and plantations. Small-scale tea production has also been a key employer, offering a livelihood for tens of thousands of families. Sri Lanka claimed the top spot as the leading tea exporter in 1995, holding a 23% market share. Presently, it stands as the world’s fourth-largest tea exporter, with an annual output of 349,699 tonnes.
Tea cultivation in Sri Lanka began in 1867 when British planter James Taylor introduced the tea plant to the island. Taylor transported the plant from China and planted it in Peradeniya. The central highlands, characterized by cool temperatures, humidity, and ample rainfall, create an ideal climate for the production of high-quality tea. In low-elevation areas like Ratnapura, Galle, and Matara districts, where temperatures are warmer and rainfall is higher, tea farming results in higher astringent levels. Sri Lanka is recognized for exporting fair-trade tea to the United Kingdom and various other countries.
The gemstone industry in Sri Lanka boasts a vibrant history, with Marco Polo himself asserting that the region possessed the finest amethysts, topazes, and sapphires globally. A significant portion, over 25%, of the country’s land area is believed to be potentially gem-bearing, with residual deposits discovered in the flood plains of the island’s streams and rivers. Sri Lanka is renowned for its production of a diverse range of gemstones, including tourmaline, spinel, ruby, corundum, and chrysoberyl, among others. Notably, the country stands as the leading global producer of Ceylon blue sapphire.
Key gemstone mining locations in Sri Lanka encompass Ratnapura, Okkampitiya, Moneragala, Kamburupitiya, Elahera, and Balangoda.
Coconut stands as a key plantation crop in Sri Lanka, contributing to more than 12% of the nation’s overall agricultural output. Annually, Sri Lanka produces over 2,500 million coconuts, utilizing an expansive land area of over 1,525 square miles for coconut cultivation. The country has gained international recognition for its exports of brown fibre, desiccated coconut, and copra. Employing the drum system, Sri Lanka efficiently extracts pure fibre from coconuts, establishing itself as the leading global exporter of brown fibre. In 2017, the coconut industry generated revenue of $598.19 million for Sri Lanka.
Natural Rubber Industry
The origins of the rubber industry in Sri Lanka trace back to 1876 when 1,919 rubber seedlings were planted in the Henerathgoda Botanical Gardens. Since then, the natural rubber sector has thrived, evolving into the country’s third-largest export revenue generator. Providing direct employment for more than 300,000 Sri Lankans, the rubber industry has established its presence in traditional growing districts such as Kegalle, Ratnapura, Matara, Kandy, Kalutara, and Colombo, among others. Each rubber tree typically has an economic lifespan of around 30 years, with harvesting commencing approximately seven years after planting. In 2014, Sri Lanka secured the sixth position among global rubber producers, exporting various types of natural rubber, including scrap crepe and ribbed-smoked sheet rubber, among others.