Sri Lanka records 1.6 percent GDP growth in second quarter of this year
Sri Lanka has reportedly recorded a 1.6 percent growth in GDP in the second quarter ended June 30, 2019.
The local media has reported that this positive growth has been reported despite the country’s tourist industry being virtually shut down after the Easter Sunday terror attacks.
The Sri Lankan economy has been able to absorb serious shocks in the last year with the country embroiled in political chaos for the last several months with no confidence votes in Parliament, a constitutional crisis, and a tenuous relationship between the President and the Cabinet.
According to media reports, the country’s GDP growth is likely to start accelerating from now through the end of the year as the political storm clouds clear and the tourism industry rebounds into its peak in the December season.
It is in this backdrop that John Keells Holdings (JKH) Deputy Chairman Gihan Cooray has stated that forward tourist bookings in his group have fully recovered following the setback suffered in the aftermath of the Easter Sunday attacks in April this year.
Sri Lanka’s economy has grown 3.7 percent in the first quarter of 2019.
In his last round of comments on the GDP, Governor of the Central Bank of Sri Lanka (CBSL), Indrajit Coomaraswamy lowered the estimates for GDP growth stating that the annual figure should be 2.9 percent for 2019.
Sri Lanka’s monetary policy has been relatively tight over the last few years, keeping inflation under control, but leading to sluggish 3 to 4 percent growth. However, the tight monetary policy has added strength and stability to Sri Lanka’s economy.
Sri Lanka has also been able to refinance billions of dollars of sovereign dollar denominated debt since the debt refinancing issue has been hanging over Sri Lanka’s head for some time.
OSL take:
The GDP recorded by the country in the second quarter of this year is indicative that Sri Lanka is on the path to development aided by strong and positive economic policies. All these along with the country’s geographical positioning in the Indian Ocean region, the ease of doing business environment, the many trade agreements as well as the trade concessions enjoyed by the country have made Sri Lanka on the path to becoming a business hub in South Asia.
| Article Code : | VBS/AT/25092019/Z_4 |