No foreign borrowings this year - Governor | Daily News

No foreign borrowings this year - Governor

Central Bank Governor, Dr.Indrajit Coomaraswamy.  Picture by Sudam Gunasinghe


 Sri Lanka will not take any more foreign borrowings this year, Central Bank Governor, Dr.Indrajit Coomaraswamy said. “We will look at more local borrowings.”

Speaking at the Monetary Policy review press briefing yesterday he said the new VAT format will be ready by end of next month.

“This year Sri Lanka will be able to maintain a growth rate of 5% and this will further increase by next year.”

He said the drought followed by the floods had a check on the growth rate in the early part of this year. “During the second half the construction and the real estate sector picked up and was a major contributor to the economy.”

He said that Sri Lanka should be ideally looking at a growth in the excess of 6% to 7% and I think this will be possible within the next 12 to 18 months.

He explained that to achieve this target Sri Lanka’s exports and Foreign Direct Investments have to improve. “These two segments are definitely under performing now.”

He said with Sri Lanka’s very strong bilateral relations to European and Asian countries and also with powerful Asian countries Sri Lanka would not have a problem to achieve increased FDI’s. With the regaining of GSP Plus and signing of ICTA Sri Lankan manufactures would also have access to over3 million people which in turn would certainly help the export sector.“In addition the signing of several proposed FYA’s and also preferential agreements would help increase FDI’s and exports”.

He also said that Sri Lanka is now recovering from a balance of payments crisis.“This was triggered by excessively by excessively loose monetary policy as large volumes of money were printed to finance a budget gap in 2015.”

The Governor also said that gross official reserves were estimated to have improved to US dollars 6.6 billion by end August 2016.“In addition the Lankan rupee has recorded a marginal depreciation thus far during 2016.” 


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