COLOMBO, Jan. 10 (Xinhua) — Sri Lanka is likely to record a modest economic growth in 2020 provided no major external shocks occur, said ICRA Lanka, a credit rating agency which is part of the global Moody’s Investor Service.
The local media quoting ICRA Lanka said on Friday that the new Sri Lankan government must adopt prudent policies, maintain fiscal discipline, and implement structural reforms to turn the economy around.
According to the agency, the Sri Lankan economy closed last year with the slowest growth since 2001. But it is “cautiously optimistic” that the nation will do better in the new year.
In its 2019 highlights report, ICRA Lanka said that for the Sri Lankan economy to recover in 2020, there must be a political will to make tough choices.
This means the government must adopt prudent policies, maintain fiscal discipline and implement structural reforms, the report said.
Hit by blows from the 2018 political crisis and last year’s April 21 Easter Sunday bomb attacks, Sri Lanka’s gross domestic product (GDP) growth in 2019 is expected to be about 2.7 percent, according to the International Monetary Fund and the Asian Development Bank. This will be the lowest since 2001.
In the third quarter of 2019, its economy saw signs of recovery with the industrial and service sectors gathering impetus. But the growth is expected to be less than 3 percent in the fourth quarter, ICRA Lanka said.
Sri Lanka’s cabinet spokesperson Bandula Gunawardena said President Gotabaya Rajapaksa had set a target of 6.5 percent growth per annum from 2020 onwards and a per capita GDP growth of 6,500 U.S. dollars.
Gunawardena further said that the president had set a five-year economic development target beginning from 2020 to guide the country towards a prosperous future.