Sri Lanka’s Finance Ministry records Rs. 21.9bn surplus in primary balance in first 10 months of 2017

Sri Lanka’s Finance Ministry records Rs. 21.9bn surplus in primary balance in first 10 months of 2017

The Finance Ministry of Sri Lanka has reportedly stated that it has achieved Rs. 21.9 billion surplus in the primary balance of the fiscal accounts during the first 10 months of 2017.
This has been recorded for the first time in 63 years.
The Ministry has stated that in the post independent Sri Lankan history a surplus in the budget deficit was first recorded in 1954 and later in 1956. In the meantime the surplus in the current account was registered from 1950 to 1970 and later from 1973 to 1994.
“Since then up to now overall budget deficit, deficit in the current account and the deficit in the primary balance were in negative growth continuously,” the Finance Ministry has stated in a news release.
During the first 10 months of the year 2017, the surplus in the budget primary balance was Rs. 21.9 billion. It was in negative by Rs. 37 billion during the corresponding period of 2016.
“Treasury officials are in the opinion that the favourable situation in the primary balance is a sign of positive growth in the economic development and it would further enhance the capacity to manage the debt repayment efficiently.”
State revenue when compared with the first ten months of 2016 has reportedly increased by 10.4 percent to Rs. 1,473 billion in 2017. It was Rs. 1,333 billion during the same period in 2016. Tax revenue during the same period has increased by 14.2 percent to Rs. 1,470 billion in 2017.
State expenditure has increased by 9.5 percent from Rs. 1,881 billion to 2,060 billion while interest expenditure during the first ten months of 2017 is Rs. 609 billion apart from the domestic and foreign debt repayment of Rs. 856 billion.

OSL take:

The recording of a Rs. 21.9 billion surplus in the primary balance of the fiscal accounts during the first 10 months of 2017 by the Sri Lankan government is a great feat that indicates stable economic conditions. Such a surplus could aid the government in its development agenda creating more investment opportunities in the country. Sri Lanka would therefore be the ideal business destination for the discerning investor.

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Article Code : VBS/AT/20180110/Z_6

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