Sri Lanka’s economic sentiment gains ground, according to survey.
Daily FT: NielsenIQ Director – Consumer Insights Therica Miyanadeniya said in the latest edition of leading business magazine LMD: “The pressure on businesses and consumers due to high inflation is phenomenal.”
“Businesses and people live in hope for better seasons to come, and both the LMD-NielsenIQ Business Confidence Index (BCI) and Consumer Confidence Index (CCI) reflect this sentiment. The BCI – though still at a relatively low range – has increased by 13 basis points to 89 – from 76 in September. The CCI has also gained 13 basis points from 25 in September to 38 in October,” she noted.
LMD reported: “Only 14% of respondents (drawn from the island’s corporates) to the exclusive BCI survey carried out in the first week of October say they expect the economy to improve in the 12 months to come (a dip in opinion from September’s 22%), and nearly two in 10 anticipate the economy will stagnate and ‘stay the same’.”
But despite the price hikes, 45% of business executives polled believed their sales volumes would increase in the next year, compared to only a third who felt this way in September, LMD observed.
“Executive opinion that there’s been an increase in business compared to the same time last year improved by five percentage points to 27 in October and 6% fewer reported a drop in sales volumes – i.e. 60% compared to 66% in September’s 66% – in a comparable period, at the time of the poll,” it added.
LMD also noted that “optimism about an improvement in business prospects in the next quarter has also risen – perhaps in anticipation of the forthcoming festive season – to 28% from 11%; and businesses anticipating fewer sales have dropped further from 48% to 42%.”
The growth momentum recorded by several key economic sectors in the country and the increasing business sentiments are indicative of the overall expansion in Sri Lanka’s economy with a strong belief that the country would bounce back from the current crisis within the next few months. Sri Lanka’s economy has shown great resilience through the years and is once again on the path to recovery after facing challenging economic conditions brought about by the global pandemic and its ensuing challenges. Sri Lanka continues to work towards becoming an emerging business destination in the South Asian region. The country’s geographical positioning in the Indian Ocean and the many trade agreements as well as trade concessions enjoyed by the country have also helped boost Sri Lanka’s image as a business conducive destination in the region. The private sector in Sri Lanka has also recorded a steady growth and profits despite challenging economic conditions, further indicating the strength and growth of the economy as well as its overall resilience. With Sri Lanka on a growth path ensuring an expansion in the country’s business potential, foreign businesses/investors could explore the growing opportunities in the country. They could also look at forming partnerships or joint ventures with local businesses with the aim of expanding operations locally and internationally.
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