Market-Oriented Policy Reforms and Manufacturing for Export in Sri Lanka

Part of the Case-Studies in Economic Development book series (CASIED)


An important element of economic liberalization has been trade policy reform, notably the removal of the bias against exports with the intention of increasing the efficiency of the economy and facilitating export-led growth (see Chapter 3 of this volume). There is empirical evidence that a number of liberalizing economies (LEs) have experienced improvements in export performance, with significant increases in manufactured exports (Helleiner, 1994 and 1995; Weiss, 1992; Arslan and van Wijnbergen, 1993; Joshi and Little, 1996). Many of these observers believe that such export success, in particular the expansion of manufacturing output and employment, has been the major contributor to the sustainability and success of economic reforms in these countries. Sri Lanka has witnessed successful export-led growth. Was this due to liberalization or, more precisely, which elements of liberalization generated such success? The driving forces behind rapid export expansion remain a matter of debate.


Exchange Rate Foreign Direct Investment Real Exchange Rate Foreign Firm Trade Liberalization 
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© Palgrave Macmillan, a division of Macmillan Publishers Limited 1999

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