SL to grow by0.3% – WB

0
56

The World Bank (WB) on 13 April cut Sri Lanka’s growth forecast for 2022 by 1.8 percentage points to 0.3 per cent.

Previously, ie in January 2022, it however forecast that growth would be stronger at 2.1 per cent. Meanwhile, Central Bank of Sri Lanka on Friday (29 April) said that Sri Lanka grew by 3.7 per cent last year.

In related developments, the WB, citing reasons behind this growth downgrade for the current year said, “Sri Lanka’s economic outlook is highly uncertain due to fiscal and external imbalances.

This would require reducing fiscal deficits especially through strengthening domestic revenue mobilisation. Sri Lanka also needs to find feasible options to restore debt sustainability.

The financial sector needs to be carefully monitored amid high exposure to the public sector and the impact of the recent currency depreciation on banks’ balance sheets.

The necessary adjustments may adversely affect growth and impact poverty initially, but will correct the significant imbalances, subsequently providing the foundation for stronger and sustainable growth and access to international financial markets,” it said.

By Paneetha Ameresekere