Stock Market to reach $ 70 b in 4Yrs

Indunil Hewage

Sri Lanka’s market capitalization will rise in another four years’ time with new entrants and new companies to be listed in the stock market, Central Bank Governor Ajith Nivard Cabraal said.

Sri Lanka has a stock market which is very vibrant and had seen an upward movement in the recent past.

The stock market in the next few years will be on a sound level which will provide necessary capital for investment activities in the country. The governor said stock market capitalization has increased to $ 20 billion in 2011 from $ 2 billion in 2002. The bond market will also be enhanced to $ 10 billion in another few years while bank lending would increase to $ 50 billion from the current $ 20-25 billion.

The Central Bank is taking necessary steps to ensure that the debt to GDP ratio and macro fundamentals will be even more flexible than what we are right now. Today, there has been an improvement in every single aspect of macro fundamentals in the country. Seven year ago, Sri Lanka’s debt to GDP ratio was 104 % and currently it has come down to 70 %. This is first time we have been able to have debt to GDP ratio which is less than 80 % after 30 years. The governor said the Central Bank is focusing on developing outside features of local economy. Two years ago, Sri Lanka’s Doing Business Rating was in triple figures and was ranked 102 in the world. Today, it has moved to 89th position and the Central Bank has clear plans for the next there years to bring Sri Lanka’s position to the 30th rank in the world.

Sri Lanka Human Development Index has also been on the upward march and the Central Bank is working all those features at the same time. In addition, we have huge opportunities in the areas of banking, non banking, micro finance, savings, stocks market, bond market and global finance and we believe that by 2016, Sri Lanka will be a $ 100 billion economy.