Tsunami a blessing in disguise for Sri Lanka’s economy

Ishara S. Kodikara | AFP | Getty Images Sri Lanka Prime Minister Ranil Wickremesinghe, center, speaks to supporters at the prime minister's official residence in Colombo on December 16, 2018, after he was reappointed as prime minister by Sri Lanka's president, the same man who fired him from the job nearly two months ago.

The Indian Ocean tsunamis killed 31,000 people in Sri Lanka and caused unprecedented damage, but were also a blessing to its economy which had been heading for a major catastrophe, according to analysts. The Indian Ocean tsunamis killed 31,000 people in Sri Lanka and caused unprecedented damage, but were also a blessing to its economy which had been heading for a major catastrophe, according to analysts. A record trade deficit, balance of payment crisis driven by high crude oil prices, galloping inflation and an uncertain political climate due to tension between the government and Tiger rebels, had pushed the economy to crisis point.

The December 26 tsunamis destroyed three-quarters of the country’s coastline, wrecked the road and railway network and initially left a million people homeless, but there followed an aid windfall from abroad.

Analysts said the avalanche of assistance from global lenders and the post-tsunami reconstruction across the devastated regions will kick-start economic growth now expected to cross five percent next year.

There will be a dip in the gross domestic product (GDP) in 2005 as an immediate effect of the tsunami, but from next year the reconstruction eff