The Investor Sentiment - Equity and investments forum for Sri Lankans
Search
 
 

Display results as :
 


Rechercher Advanced Search

Latest topics
» REXP.N0000 ( RICHARD PIERIS EXPORTS PLC)
Today at 7:22 am by CK

» HNB.N0000 ( Hatton National Bank PLC)
Today at 6:18 am by pjrngroup

» Thread for News on CSE and SL Economy
Today at 5:16 am by NIRMALSG

» අපිට විතරද පායන්නේ ?
Yesterday at 9:06 pm by malanp

» Tourism sector
Yesterday at 5:47 pm by NIRMALSG

» අනං මනං! #/+?.<>
Yesterday at 5:15 am by NIRMALSG

» NDB.N0000 (NATIONAL DEVELOPMENT BANK PLC)
Sun Mar 24, 2019 5:04 pm by NIRMALSG

» Oman's Oil and Gas Minister Dr. Al Ruhmy arrives in Lanka.
Sun Mar 24, 2019 12:11 pm by Ethical Trader

» Help him Today, so he can help another Tomorrow
Sun Mar 24, 2019 8:01 am by spw19721

» SAMP.N0000 (SAMPATH BANK PLC)
Sat Mar 23, 2019 6:37 pm by PANTOMATH

» Happy Birthday
Fri Mar 22, 2019 6:01 pm by Ethical Trader

» Dividend Announcement
Thu Mar 21, 2019 9:26 pm by nihal123

» PLC.N0000 ( People's Leasing and Fiance PLC)
Thu Mar 21, 2019 11:15 am by Ethical Trader

» රෝගීන් වෙනුවෙන් කැප වන සෞඛ්‍ය සේවාවක් වෙනුවෙන්.....
Tue Mar 19, 2019 9:34 am by AjithR

» JEWS OF SRI LANKA: AN UNTOLD STORY
Tue Mar 19, 2019 9:22 am by කිත්සිරි ද සිල්වා

» How Small We are in the universe
Tue Mar 19, 2019 7:29 am by nihal123

» ඉස්සරහට අපි පරදින එකනම් ෂුවර් – ධම්මික ක්‍රිකට් ගැන කතා කරයි
Fri Mar 15, 2019 2:59 pm by nuwanmja

» HAYL.N0000 Hayleys PLC
Thu Mar 14, 2019 2:46 pm by yellow knife

» EAST WEST PROPERTIES PLC (EAST.N0000)
Thu Mar 14, 2019 10:57 am by slstock

» DFCC.N0000 ( DFCC BANK PLC )
Wed Mar 13, 2019 6:44 pm by serene

» DOCK.N0000 (COLOMBO DOCKYARD PLC)
Sun Mar 10, 2019 8:36 pm by NIRMALSG

» GLAS.N0000 (PIRAMAL GLASS CEYLON PLC)
Sun Mar 10, 2019 6:40 am by ruwan326

» Mobile Trading: the new BUZZ word in Capital Markets Industry!
Thu Mar 07, 2019 5:58 pm by Brenda John

» MGT.N0000
Sun Mar 03, 2019 2:48 pm by Hawk Eye

» MTD WALKERS - KAPI
Sun Mar 03, 2019 8:57 am by Jana1

» Should such people be trusted and help anymore?
Sun Mar 03, 2019 4:42 am by pjrngroup

» The messenger who couldn't deliver a message
Wed Feb 27, 2019 5:56 pm by Backstage

» SHL.N0000 (Softlogic Holdings PLC)
Wed Feb 20, 2019 8:23 am by ruwan326

» Importance of 2019 government budget
Tue Feb 19, 2019 12:13 pm by කිත්සිරි ද සිල්වා

» Emir of Qatar on a private visit to Sri Lanka till February 22
Tue Feb 19, 2019 11:19 am by Backstage

» දේවදත්තගෙන් අපායේ සිට මෛත්‍රී බුදුන් වහන්සේට එවන ලද ලිපිය...~~~
Fri Feb 15, 2019 8:24 am by ruwan326

» CONN.N0000
Wed Feb 13, 2019 8:09 pm by ruwan326

» SERV - The Kingsbury
Wed Feb 13, 2019 8:08 pm by ruwan326

» TPL.N0000 (TALAWAKALE PLANTATIONS )
Wed Feb 13, 2019 7:53 pm by ruwan326

» KVAL.N0000
Wed Feb 13, 2019 7:36 pm by ruwan326

» HAYC - Haycarb
Wed Feb 13, 2019 7:24 pm by ruwan326

» DIPD.N0000 (Dipped Products)
Wed Feb 13, 2019 7:22 pm by ruwan326

» මහජනතාව බල ගැන්වෙම්න් සිටී…
Tue Feb 12, 2019 8:23 pm by ruwan326

» VFIN - where the journey leads it?
Mon Feb 11, 2019 7:35 pm by ruwan326

» LFIN - LB Finance
Mon Feb 11, 2019 7:25 pm by ruwan326

» Sri Lanka urged to develop own narrative of China’s BRI
Mon Feb 11, 2019 2:50 pm by Backstage

» Wonder why men send photos of their genitals? Here are some theories
Mon Feb 11, 2019 11:01 am by Backstage

» Flying is the Safest mode of Transport
Sat Feb 09, 2019 8:12 am by කිත්සිරි ද සිල්වා

» LLUB.N0000 (CHEVRON LUBRICANTS LANKA PLC)
Thu Feb 07, 2019 2:24 pm by Ethical Trader

» Lanka named top tourist destination for 2016
Wed Feb 06, 2019 2:29 pm by කිත්සිරි ද සිල්වා

» A Bit of History
Wed Feb 06, 2019 2:18 pm by ruwan326

» AMF.N0000
Thu Jan 31, 2019 6:56 am by serene

» IOC Sri Lanka unit December quarter loss widens to Rs987mn
Mon Jan 28, 2019 11:02 am by ruwan326

» මූර්ත පොළියෙන් ශ්‍රී ලංකාව අංක 1ට – බ්ලූම්බර්ග් අනාවරණය කරයි
Mon Jan 21, 2019 7:18 pm by nihal123

» Obituary Notice.
Mon Jan 21, 2019 7:14 am by කිත්සිරි ද සිල්වා

March 2019
SunMonTueWedThuFriSat
     12
3456789
10111213141516
17181920212223
24252627282930
31      

Calendar Calendar

Disclaimer


Information posted in this forum are entirely of the respective members' personal views. The views posted on this open online forum of contributors do not constitute a recommendation buy or sell. The site nor the connected parties will be responsible for the posts posted on the forum and will take best possible action to remove any unlawful or inappropriate posts.
All rights to articles of value authored by members posted on the forum belong to the respective authors. Re-using without the consent of the authors is prohibited. Due credit with links to original source should be given when quoting content from the forum.
This is an educational portal and not one that gives recommendations. Please obtain investment advises from a Registered Investment Advisor through a stock broker

Sri Lanka needs prudent fiscal policy to retain confidence, refinance debt: Economist

Go down

Sri Lanka needs prudent fiscal policy to retain confidence, refinance debt: Economist

Post by The Invisible on Wed Oct 17, 2018 9:51 am

ECONOMYNEXT - Sri Lanka needs prudent fiscal management to retain confidence of debtors amid a peak in upcoming repayments which needs refinancing and elections which may undermine policy, an economist has said.

"Retaining foreign investor confidence is going to be the most important thing, and one critical area is that we must have a fiscally responsible regime in place," Dushni Weerakoon, the Executive Director Institute of Policy Studies, a Colombo-based think tank said.

But Sri Lanka is facing convergence of political economic events in 2019 which is increasing the risk of policy slippage, she said. Global interest rates were also rising.

"It’s a little unfortunate that all of this are converging next year," Weerakoon said at the launch of the IPS's flagship publication, the State of the Economy 2018.

"There’s the more near to medium term risk of fiscal discipline that comes mostly through the political channel related to elections, but clearly we need to ensure that there is a fiscal sustainable regime in place."

"There is likely to be a pressure that will build up for policy backsliding."

Successive regimes in Sri Lanka have had a habit of spending government finances to win votes.

At the moment Sri Lanka is in a stabilization program with the International Monetary Fund, which is currently in limbo with the last review yet to be completed over the failure to meet forex reserve targets.

Budget deficits have been brought down and taxes raised. State spending was raised in a budget in 2015, which contributed to undermining the fiscal framework.

Despite better fiscal policy, analysts say policy errors by the central bank involving contradictory policy have led to monetary instability.

Analysts who closely track the central bank has said that a sudden halt in mopping up inflows in the first quarter of 2018 (failed term repo auctions) as the economic recovered a little, led to a weakening of a de facto soft-peg with the US dollar (Sri Lanka injects Rs123bn to sterilize dollar outflows). A liquidity spike in August was similarly unsterilized.

Trade controls have been put in place as part of efforts to stabilize the currency peg.

Weerakoon said that the curbs on high value imports put in place to halt further currency depreciation will reduce taxes for the government.

It is not clear why the administration place trade controls to correct monetary instability. Under the IMF deal Sri Lanka has pledged not to resort to trade controls to fix balance of payments troubles, which are a result of monetary instability.

Weerakoon said that so far, the government has had better management of public finance.

She said monetary policy and foreign exchange management has been prudent within the constraints placed on the country.

Weerakoon said that political room will be small to push through required structural reforms next year, and will keep growth at around 4 percent.

"Fiscal policy is in a bit of a straightjacket but Sri Lanka also has to focus on growth, because it is important to increase GDP growth to lower our debt leverage ratio," she said.

“Debt accumulation is accelerating rather than decelerating."

Rise of international interest rates are also reducing favourable borrowing terms, she said.

But there were several positive developments.

She said exports and foreign direct investments have turned around in 2018 which was a positive development and tourist earnings are growing, but they will not increase massively in a short period.

The increasing oil prices and currency induced inflation will on the other hand require the central bank to be watchful and conduct monetary policy appropriately going forward, she said. (Colombo/Oct16/2018)
The Invisible
The Invisible

Posts : 878
Join date : 2016-11-28
Age : 39

Back to top Go down

Back to top


 
Permissions in this forum:
You cannot reply to topics in this forum