Sri Lankan government to amend 2019 budget considering revenues at end of 2019 second quarter
Sri Lanka’s State Minister of Finance Eran Wickremaratne has reportedly stated that the government would look at revenues in the second quarter of 2019 and re-prioritize expenditure in the second half of 2019.
The State Minister’s comments come as the country recovers from the tragic Easter Sunday attacks last month.
He has said first quarter revenues were broadly as expected. But a review of the budget will take place at the end of the second quarter.
“If revenues are slowing we will do a review on the budget expenditure side,” Wickremarante has said adding, “We are committed to fiscal discipline, so we will have to re-look at priorities.”
“If interest rates fall that will also help.”
According to the Minister, other programmes such as Enterprise Sri Lanka (SME and start-up credit) and Gamperaliya (rural small infrastructure) are also boosting economic activity.
The Sri Lankan government had also settled about Rs. 80 billion in arrears to suppliers.
“We will meet all our debt obligations. We will go to the international markets and raise funds if we need to. We will raise the previously announced US$2 billion, and there is another US$1 billion policy base guarantee by the World Bank. This allows to use their credit rate and provides a guarantee to raise money for yourself. So immediately there will be another benefit of about 100 basis points and of the US$2 billion, US$1 billion will be covered by that. It also allows to extend the tenure. All this is possible because of the fiscal discipline we have maintained,” he has noted.
Wickremaratne speaking of confidence building exercise of the investors, has said they have had discussions with multinationals and others, while the first external engagement with Invest Sri Lanka in Singapore was a great success.
OSL take:
The government of Sri Lanka has taken several measures already to help Sri Lanka’s economy bounce back from the negative impact on the country’s economy following last month’s Easter Sunday attacks. The country’s tourism industry has already been offered a relief package and Sri Lankan and local banks have also been directed to provide relief to the business community. The statement by the State Minister of possible amendments to the 2019 budget could result in further incentives being provided to the business community. Given Sri Lanka’s many trade agreements and trade concessions coupled with the current incentives offered by the government, Sri Lanka is an attractive business destination to the discerning foreign investor.
| Article Code : | VBS/AT/27052019/Z_2 |