Sri Lanka’s LMD-Nielsen Business Confidence Index records upward movement after four months
Sri Lanka’s LMD-Nielsen Business Confidence Index (BCI) has reportedly increased by 19 basis points to register 81 in June following four months of declining fortunes.
In comparison, the index stood at 102 a year ago while the average for the last 12 months is 10 basis points higher, LMD has reported.
Nielsen’s Managing Director Sharang Pant has stated he believes that the country is gradually emerging from the events that occurred towards the end of April.
He has been quoted as saying: “There is some level of optimism and discussions at various forums about how Sri Lanka should turn this into an opportunity to come back stronger – politically, socially and economically.”
However, he has added that “citizens in general remain wary of the safety aspect – and this is impacting sentiment or confidence in general.”
LMD, which is a leading business magazine in Sri Lanka, has reportedly noted that political uncertainty is highlighted among the main national concerns while taxes and inflation are topics of concern in business circles.
According to a respondent, “despite the recent terror attacks and declining sales volumes, we have to pay high taxes – and that makes us barely profitable.”
A spokesperson for Media Services, which publishes LMD, has been quoted as saying by the Engilsh daily, Daily FT that while the reversal in sentiment is a welcome sign, expecting sustained gains in the coming months may be an overreaction.
OSL take:
The upward movement recorded in the LMD-Nielsen Business Confidence Index is a positive sign on the growth momentum in Sri Lanka’s economy. The country’s economy was on a slow track following the Easter Sunday bombings and the latest report on the LMD-Nielsen Business Confidence Index that has recorded an increase last month (June) is indicative of the country’s economy returning to normalcy. The country’s economic policies have resulted in the continuously increasing business confidence in Sri Lanka, which is evident in the oversubscription of the sovereign bonds issued by the Central Bank of Sri Lanka and the continuous foreign funding by lending agencies to carry out the island’s aggressive development programme. Foreign businesses/investors could therefore confidently explore business/investment opportunities in Sri Lanka.
| Article Code : | VBS/AT/08072019/Z_5 |