Author: TELO Admin

Economists sharply cut Sri Lanka’s growth outlook for the rest of the year as curbs on imports and still-limited reserves persist, even as the International Monetary Fund (IMF) releases bailout loans and the authorities work towards debt-restructuring efforts, the latest Bloomberg survey of economists showed.

According to Bloomberg News, the economic contraction is predicted to more than double from 4.4 per cent to 9.9 per cent in the first quarter. Growth is likely to bounce back from the second quarter, though at a slower pace of 1 per cent from an estimated 2.9 per cent previously.

For the full year, Sri Lanka’s gross domestic product estimate was revised to 0.7 per cent from 2.7 per cent, the survey showed.

Last year, the South Asian nation grappled with its worst economic crisis since independence as US dollar shortages and shrinking reserves, together with an infamous organic fertiliser policy, led to crop failures and severe shortages of food and fuel. People took to the streets to protest, eventually forcing a change in leadership as the economy nearly came to a halt and inflation surged.

While there are signs of stability with food and fuel imports coming in and the IMF approving a US$3 billion loan, some economists say the current economic situation is nowhere close to pre-pandemic normalcy.

“Conditions are still weak, but are tilted to the upside,” said Andrew Vogel, an economist at S&P Global.

He added that Sri Lanka has very few usable foreign reserves and significant restrictions on imports. Moreover, a still-ongoing moratorium on external debt payments pending restructuring agreements is keeping conditions uncertain.

The island nation’s double-digit inflation, which is Asia’s fastest, is expected to persist this year, the Bloomberg survey showed. Economists foresaw consumer prices surging to around 28.8 per cent in the second quarter and averaging around 25 per cent for the year.

They also forecast a cumulative 100-basis-point hike in the benchmark rates in the second quarter. They expected this to hold at least until the end of the third quarter before the easing cycle begins.

The Central Bank of Sri Lanka has kept its key rate at the highest level since August 2001 to support growth, despite price gains remaining stubbornly high at 50.3 per cent in March. The monetary authority predicts that headline inflation will slow to single-digit levels by end-2023.

Inspector General of Police (IGP) C.D. Wickramaratne was among a number of policemen and politicians who met former President Mahinda Rajapaksa to greet him for the Sinhala and Tamil New Year.

Rajapaksa’s office posted images on social media of some of those who visited him at his residence to greet him for the New Year.

Among those seen greeting the former President and having a conversation with him was IGP Wickramaratne.

Former Navy Commander Wasantha Karannagoda was also pictured meeting the former President.

A number of other policemen and Sri Lanka Podujana Peramuna (SLPP) MPs, including Cabinet Ministers, also visited the residence of Mahinda Rajapaksa and greeted him for the traditional New Year.

The Chinese Embassy in Sri Lanka has issued a statement clarifying that the Chinese National Wildlife and Grassland Administration Unit has not received any application for the importation of 100,000 rilawas from Sri Lanka.

The statement also notes that the unit has no knowledge of a request for the importation of 100000 rilawas from Sri Lanka. The Chinese National Wildlife and Grassland Administration Unit is responsible for monitoring and managing the import and export of wild animals and plants to and from China, and permission must be granted by the unit for such activities.

The embassy’s statement comes in response to reports in local and international media claiming that Sri Lanka was ready to export 100,000 endangered relaws to a Chinese private company for research. The Sri Lankan Minister of Agriculture, Mahinda Amaraweera, has previously made clarifications on the matter.

The Chinese Embassy has made inquiries to the National Wildlife and Grassland Administration Unit to address the issue.

Representatives from the administrative body of the Vedukkunaari mountain temple and several Hindu organisations from Vavuniya met with the High Commissioner of India to Sri Lanka to discuss issues related to threats to the temple.

The administrative body of the Athi Lingeswaran Temple shared concerns about the destruction and vandalism of idols in their temple, obstacles presented by the Archaeological Department to replace and reconsecrate the idols, and ongoing Sinhala colonisation of various villages on the border of the Northern provinces with the High Commissioner. They also presented documentation detailing these issues over the past few years.

The temple administration reported that the High Commissioner promised to address these issues in relevant forums to resolve them amicably and as soon as possible.