IMF says Sri Lanka’s economy gradually recovering from last year’s Easter Sunday terrorist attacks

The International Monetary Fund (IMF) has said Sri Lanka’s economy is gradually recovering after Easter Sunday terrorist attacks last year with GDP growth projected at 3.7 percent in 2020. An IMF staff mission to Sri Lanka estimated the real GDP growth at 2.6 percent last year but expected the GDP to bounce back this year on the back of a recovery in tourism.

A staff team from the IMF visited Colombo from the 29th of January to meet with the new administration and discuss its policy agenda. The team noted that renewed efforts to advance fiscal consolidation will be essential for macroeconomic stability given risks to debt sustainability and large refinancing needs over the medium term. The mission concluded that ambitious structural and institutional reforms are needed to anchor policy priorities, bolster competitiveness and foster inclusive growth in Sri Lanka. It said the government should move ahead with growth-enhancing structural reforms to fully harness Sri Lanka’s economic potential and foster greater social inclusion. The team welcomed the authorities’ plans to enhance the efficiency of state-owned enterprises, enabling them to operate on a sound commercial basis adding these plans would need to be supported by a visible commitment to strengthen governance and transparency.

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