As Sri Lanka is forecasted to see a slow down in GDP growth through this year and the next, it should look towards Costa Rica’s example of leveraging its tourist attractions to link environmental preservation to economic returns, Asian Development Bank Agriculture, Food, Nature, and Rural Development Sector Office former Director Sanath Ranawana said, speaking to The Daily Morning Business yesterday (10).
Responding to a question on how Sri Lanka may avail of its existing resources to influence growth – as it reaches a structural slowdown after its initial post-crisis recovery – Ranawana said: “The real advantage Sri Lanka has is its natural environment, which is what most tourists come to Sri Lanka for - the beaches and the mountains. One thing is we need to ensure that those beautiful places which bring in tourism remain intact.”
He pointed out that the South American nation offers a great case for Sri Lanka to reposition its environment preservation from an economic cost to a core economic driver – with natural capital directly attracting foreign investment.
“The best example of a country that recognized the potential of its resources was Costa Rica. Costa Rica, very early on, realised that if they didn’t protect its forests, they were to lose their tourism.”
“The Government alone can’t protect all the forest and all the landscapes, but if the tourism authority or tourism ministry contributed part of its tourism revenue towards communities to do better forest management – then you have a win-win. You have the community benefiting from it, you have Government revenue being complemented with tourism revenue,” he said.
The IMF, in its own statements, have stressed that once Sri Lanka reverts to a primary balance target of 2.3% of GDP in 2027 – a resilient services and tourism sector is vital for generating the foreign exchange earnings needed to support external and fiscal sustainability.
Ranawana described how Costa Rica leveraged its ecotourism brand to channel international capital into climate investments, by turning natural habitats into self-sustaining financial assets, rather than a target for resource attraction.
“Costa Rica started with putting a small levy on fuel, the levy which went into financing or incentivising people in the forest areas, to protect their forests. Now it’s the most amazing success story of ecotourism in the world.”
The International Monetary Fund (IMF) and World Bank both forecast downward growth for Sri Lanka. The World Bank projects growth of 4.4% in 2026, easing to 4.2% in 2027 and 4.0% in 2028. The IMF projects 4.0% in 2026 and 3.7% in 2027.
Ranawana said that Sri Lanka may even leverage its 300 km Pekoe trail, which attracts a significant number of international travellers. “The Pekoe trail – a real crowd provider – has huge potential to be another international nature trail.”
Responding to a question on why Sri Lanka has yet to propose a plan to utilise its natural habitat/assets to leverage growth, he said that Sri Lanka is yet to place value on the importance of its ecosystems.
Sri Lanka officially launched its National Climate Finance Strategy (2025-2030) in October 2025, to mobilise resources for climate resilience, adaptation and net-zero transition. Within the Strategy, Sri Lanka is to introduce a Natural Capital Accounting (NCA) primary data framework, which is to measure and price Sri Lanka’s environmental assets. By way of the implementation of this framework, Sri Lanka is to integrate its ecosystems directly into its national economic accounting and budgeting.
According to the strategy, Sri Lanka plans to formally launch its national NCA framework initially focusing on two vital, high-risk areas: the upper watershed and coastal/marine ecosystems.