Sri Lanka’s economic growth to rebound to 5-5.5 percent in 2018 says Central Bank Governor

Sri Lanka’s economic growth to rebound to 5-5.5 percent in 2018 says Central Bank Governor

Governor of the Central Bank of Sri Lanka, Indrajit Coomaraswamy has reportedly said that Sri Lanka’s economic growth will rebound to 5.0 to 5.5 percent in 2018 from a below 4.0 percent in 2017 with more domestic and foreign private investment.
Presenting the Central Bank’s Road Map for Monetary Policy in 2018, the Governor has noted that growth will have to be driven by domestic private investment and also larger flows of foreign direct investment coming from economic reforms of the government.
Private investors need a stable macro-economic environment with predictable policies to operate and invest, Coomaraswamy has been quoted as saying.
The Central Bank through its tighter policies had brought stability to the economy, and the exchange rate, creating conditions for investors to act, but growth has taken a hit.
Sri Lanka’s growth will fall to a ‘shade below 4-pct’ in 2017, Coomaraswamy has said.
The economy was hit by a drought, floods, and the usual hangover from a monetary backed fiscal overspending in 2015 and 2016 (a Keynesian stimulus), which generated a balance of payments crisis.
The Central Bank is not looking to cut rates at the moment with market interest rates already falling amid slowing private credit and a more stable budget deficit.
Growth has to come from investment, the Governor has emphasized.

OSL take:

The statement by the Governor of the Central Bank on Sri Lanka’s economic growth anticipated for 2018 should build confidence in investors to consider the many investment opportunities in the country.

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Article Code : VBS/AT/20180105/Z_2

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