Bright prospects for Lanka’s economy - IMF
Channa BANDARA WIJEKOON
Economic prospects for Sri Lanka are very bright now and the country
must capitalize on it. The process can be accelerated with tourism, tea
and garments, IMF Resident Representative for Sri Lanka and the Maldives
Dr. Koshy Mathai said.
He was the chief guest at the tenth CIM Annual conference held at
Cinnamon Grand hotel on Monday.
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Koshy
Mathai |
IMF is very concerned about Sri Lanka’s fiscal condition which is
improving supported by the growth in the world coming out of recession.
The Government has brought down the deficit. The Government does tax
reforms. All in all, economic management by the Government is good.
Thus, conditions are set to develop Sri Lanka, Mathai said.
At present, things are on the right track for Sri Lanka. Banks are
now recognizing the upward trend of economy and falling in line. Private
sector credits which were at a low level for implications in the macro
environment too are now following suit and as a result, private sector
credits are growing. The GDP, which is six per cent, now is forecast to
hit six point five per cent towards the year-end.
“Now the country must maintain the macro economic stability. The
recession hitting the world hard in the fourth quarter of 2008 and oil
prices sky rocketing saw a fall in remittances to the country. In the
last two to three years, Sri Lanka depended on short-term or external
borrowing. As a result, the rupee depreciated,” he said.
In early summer 2008, things changed for the better. Remittances
bounced back to the country. End of conflicts in the country opened
doors for new opportunities. Colombo exchange market showed a marked
improvement. The reserves of the country boosted to one billion dollars
in one month alone and went up to five billion dollars in a short
period, which was an amazing improvement from last year.
The IMF was concerned about the monetary policy of Sri Lanka. Thus
IMF carefully monitored the changes and suggested the Central Bank of
Sri Lanka to relax monetary policy, which they did. The inflation that
was 30 percent in 2008 came down to seven per cent. Warwick Business
School, UK Professor Policy and Marketing Robin Wensley said, the
customer judges value we offer to a product or a service against the
competitors value offer. Hence, genuine value addition is needed to
provide economic value (EVC) to the customer.
Products, organizations or a country as a whole must not be over
branded or under branded.
“Sri Lanka can venture into capturing a global market share with top
four categories of clothing, fresh food, textiles and electronic
components, in addition to conventional product categories,” Wensley
said.
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