COLOMBO: To provide relief to the island nation amid the unprecedented economic crisis, Sri Lankan President Ranil Wickremesinghe on Tuesday presented an Interim Budget and said that the talks with International Monetary Fund (IMF) is in final stage.
The budget is focused on increasing the government revenue. The Interim Budget is being presented to the Sri Lankan Parliament, in order to prepare the basic foundation for changing the economic trajectory of the country.
“We are now adopting the short-term measures. Negotiations with the International Monetary Fund (IMF) have successfully reached its final stage. Discussions on debt restructuring will be held with the main countries that provide loan assistance to our country.” he said.
In presenting the Interim Budget, the President pointed out at the extent and depth of the economic crisis that the island nation is facing. “Due to these short-sighted economic practices, the country’s progress has been hampered from time to time. Many of those setbacks occurred in the name of citizens who also accepted those policies without any criticism,” he said.
To solve this economic crisis, Wickremesinghe said that one of the basic tasks that the country needs is to extricate from the traditional political perspectives and impartially appraise the reality of the ground situation in the context of the global environment.
He noted that the crisis will not be solved by accusing one another, nor by faulting the past and can only be solved by adopting short- and long-term plans.
Wickremesinghe added, “the United Nations in collaboration with leading international organizations, is launching a programme to ensure food security. The process of providing daily needs like gas, electricity and fuel without a shortage has been initiated. Schools have opened, and the universities are commencing their academic activities.”
The Sri Lankan President said that all of this reflects that we are on the correct course in the short term for recovery. However, he highlighted that Sri Lanka cannot be complacent. “We should prepare a National Economic Policy for implementation continuously at least over a period of 25 years. As I mentioned at the beginning, this Interim Budget forms the basic foundation for the National Economic Policy, which is envisaged to be established through the 2023 Budget.”
During his speech, he mentioned that once the discussions with the IMF are concluded, he expects to provide the information on the same to the Parliament.
“Our fiscal stabilisation programme envisages government revenue increasing to around 15 percent of GDP by 2025 from the 8.2 percent of GDP as at end 2021. The government is targeting a primary surplus more than 2 percent of GDP in 2025 and expects to improve upon this level thereafter. We aim to reduce public sector debt from around 110 percent of GDP as at end 2021, to no more than 100 percent of GDP in the medium term.”
“It is expected that inflation will be brought back under control to a mid-single digit level in the medium term. In line with this, interest rates are also expected to reach a moderate level gradually.” (ANI)