Sri Lanka’s Gross Domestic Product growth is projected to decrease from 5% in last year (2025) to 3-4% in this year, due to an expected slowdown in the economy, as a result of the impact of cyclone Ditwah, First Capital affirmed at its Investor Symposium for 2026, held last week (22).

First Capital Holdings PLC, a subsidiary of JXG (Janashakthi Group) and a pioneering leader in Sri Lanka’s investment landscape, raised growth prospects and plausible vulnerabilities during the event.

It elaborated that the damage from the cyclone is likely to lead to contractions in spending, especially in areas beyond the main Western province, which is expected to affect the economy. While Sri Lanka’s fiscal resilience and fundamental discipline, a trend since 2023, are anticipated to remain robust, the need for higher capital expenditure in post-Ditwah revitalisation efforts creates challenges.

The main point of concern was that with slower economic growth, it could become more challenging for Sri Lanka to continue making good progress on managing its national debt.

Concurrently, the symposium’s discussion spanned interest rate movements, exchange rate trends, and bond market developments. The event also provided a unique platform for investors, industry leaders, and experts to engage in critical discussions on the market forces that are shaping Sri Lanka’s economic future.

First Capital Holdings PLC Managing Director/CEO Dilshan Wirasekara said: “At First Capital, we are dedicated to creating value within the industry through the generation of dependable, deep market insights and actionable strategies. Events like the First Capital Investor Symposium allow us to bring together thought leaders and investors and share knowledge while fostering a collaborative approach to achieving sustainable investment success.”

Discussing First Capital’s predictions and investment strategies for this year, First Capital Holdings PLC Chief Research and Strategy Officer Dimantha Mathew said: “Our team at First Capital Research is committed to facilitating collaborations that yield highly accurate market predictions. This year, we have outlined a set of investment recommendations across bonds and equities that we believe will help investors make better informed, strategic decisions to maximise their returns in what will be a pivotal year for Sri Lanka’s markets.”