Abstract:
Most countries can maintain good relations between themselves due to the
globalization. In this regard, Sri Lanka has also engaged in international
transactions with a number of countries. In 1977, as a result of the
liberalization, Sri Lanka had the opportunity to keep up relations with all
countries. Therefore, the process of export and import operations began to
expand; foreign investments increased; and the tourism sector began to grow.
Due to imports, the domestic population got the opportunity to use a variety
of goods and services. This study has focused on the economic relationship
that Sri Lanka maintains with China and the main objective of this study is to
identify the impact of the China-Sri Lanka relationship on Sri Lankan
economic growth and to analyze the short-term and long-term impact of the
China-Sri Lanka relationship on economic growth in Sri Lanka. This research
has used five variables such as tourist arrivals, debt of China, exports, imports,
and GDP of Sri Lanka in developing the economy of Sri Lanka. The data for
the survey is based on secondary information. The study applied the multiple
regression analysis and descriptive method to analyze data from 1977 to 2018.
The results were obtained through EViews. The finding revealed a significant
relationship between Sri Lankan economic growth and China-Sri Lanka
relations. Thus, the China-Sri Lanka relationship was effective in the short
run-on Sri Lankan economic growth and while the change in one or more
variables among these, it suddenly impacts the economic growth of Sri Lanka
in the short run. Therefore, the study recommends encouraging exports of Sri
Lanka to China and recommending strengthening the infrastructure facilities,
transportation, political stability, and defense for foreigners should be
promoted to develop the relationship with China.
