weighted score 3.8 · five dimensions
Geopolitical & Concentration Risk
Sri Lanka
Geopolitical conflict, supplier concentration, climate exposure, sanctions risk and policy continuity intelligence for Sri Lanka-origin supply chains.
Geopolitical conflict
3
Civil war ended 2009. Post-conflict reconciliation incomplete but no active armed conflict. 2022 political crisis resolved through constitutional processes. Low interstate conflict risk.
Supplier concentration
3
~80% of global true cinnamon production. Significant garment exporter but not dominant globally. No critical raw materials or strategic technology dependencies. Concentration risk is sector-specific, not systemic.
Climate & physical risk
7
High climate vulnerability — monsoon flooding, landslides, cyclone basin exposure. Germanwatch CRI ranks Sri Lanka among most climate-affected countries. Small island geography amplifies infrastructure vulnerability.
Sanctions exposure
1
No comprehensive sanctions. No EU or US broad sanctions programmes. Individual civil war-era sanctions largely resolved. Low sanctions risk for sourcing operations.
Policy continuity & property rights
5
2022 sovereign default and political upheaval demonstrated policy fragility. IMF programme provides a stabilising framework but fiscal consolidation creates uncertainty. New government (2024) committed to reforms but track record is limited.
Conflict & Stability
Conflict & Stability
- Civil war legacy
- Sri Lanka's 26-year civil war ended in May 2009 with the military defeat of the LTTE (Tamil Tigers). Post-conflict reconciliation remains incomplete. The northern and eastern provinces still experience elevated security presence and unresolved land disputes.
- 2022 political crisis
- The sovereign default triggered mass protests (Aragalaya movement) that led to President Rajapaksa fleeing the country in July 2022. Political stability has been restored under successor governments, but underlying social tensions from economic hardship persist.
- 2024 political transition
- President Anura Kumara Dissanayake was elected in September 2024, representing the JVP/NPP coalition. This marked a significant shift from the Rajapaksa-era political establishment. The new government has committed to continuing the IMF programme while pursuing anti-corruption reforms.
Climate & Physical Risk
Climate & Physical Risk
- Monsoon exposure
- Sri Lanka is exposed to both the southwest monsoon (May-September) and northeast monsoon (December-February). Severe flooding and landslides are recurring annual events, particularly in the central highlands and southwestern lowlands.
- Cyclone vulnerability
- While Sri Lanka is less frequently hit by direct cyclone strikes than Bangladesh or Myanmar, it sits within the Bay of Bengal cyclone basin. Near-miss cyclones generate severe rainfall and coastal storm surges.
- Germanwatch CRI
- Sri Lanka ranks among the most climate-vulnerable countries globally on the Germanwatch Climate Risk Index, reflecting high historical weather-related losses relative to GDP. Small island geography amplifies climate impact on infrastructure and agriculture.
Sanctions & Policy Continuity
Sanctions & Policy Continuity
- Sanctions status
- Sri Lanka is not subject to comprehensive international sanctions. No EU or US broad sanctions programmes target Sri Lanka. Individual targeted sanctions related to the civil war era have largely been addressed through diplomatic channels.
- Sovereign default impact
- The April 2022 sovereign default — the first in Sri Lanka's history — fundamentally disrupted the business environment. Import restrictions, fuel rationing, and capital controls created severe operational challenges. The IMF programme (approved March 2023) has stabilised the economy but debt restructuring negotiations continue.
- Cinnamon concentration
- Sri Lanka produces approximately 80% of the world's true cinnamon (Cinnamomum verum). While this is a dominant global market share, cinnamon is not classified as a critical raw material by the EU or US, limiting strategic supply chain risk.