Sri Lanka economy could shrink by -3.5pc to -4.0pc: Wickremesinghe


FE Team | Published: January 28, 2023 20:11:17 | Updated: February 01, 2023 12:46:08


Sri Lanka economy could shrink by -3.5pc to -4.0pc: Wickremesinghe

Sri Lanka's economy could contract by -3.5 or -4.0% in 2023 after shrinking -11% last year, President Ranil Wickremesinghe said on Saturday.

"From 2024, we will take this economy to positive growth. We are creating a strong country that does not bow down to anyone and is debt-free," he said.

Speaking at a religious event, he said: "The growth rate of the economy in 2022 was -11% and could be -3.5 or -4.0% this year."

If economic programmes which includes difficult changes in policy such as higher taxes, cuts in public expenditure and debt restructuring were not implemented then Sri Lanka could witness further political unrest, he said.

"No one can prevent the country from falling into crisis again similar to May and June last year," Wickremesinghe said.

The island nation of 22 million people has struggled with challenges during the past year ranging from a shortage of foreign currency to runaway inflation and a steep recession - the worst such crisis since independence from Britain in 1948, reports Reuters.

The government signed a preliminary agreement with the International Monetary Fund (IMF) in September for a $2.9 billion programme but has to put its debt on a sustainable path before disbursements can begin.

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