SL 89th in Forbes’ Best Countries for Business

Sri Lanka is placed 89th out of 146 nations in the Forbes’ Best Countries for Business 2014 ranking, Forbes announced.

The best country for business this year is Denmark, which ranked No. 1 three straight years between 2008 and 2010. The top10 includes also Hong Kong, New Zealand, Ireland, Sweden, Canada, Norway, Singapore and Switzerland.

India has been placed 93rd, behind countries like Mexico, Kazakhstan

The Forbes said “…however, low tax revenues are a major concern.A large trade deficit remains a concern, but strong remittances from Sri Lankan workers abroad help offset the trade deficit.”

Forbes’ annual ranking of the Best Countries for Business grades countries on 11 different metrics, including property rights, innovation, taxes, technology, corruption, freedom (personal, trade and monetary), red tape, investor protection and stock market performance.

It also stated:

Sri Lanka continues to experience strong economic growth following the end of the 26-year conflict with the Liberation Tigers of Tamil Eelam. The government has been pursuing large-scale reconstruction and development projects in its efforts to spur growth in war-torn and disadvantaged areas, develop small and medium enterprises and increase agricultural productivity. The government's high debt payments and bloated civil service have contributed to historically high budget deficits, but fiscal consolidation efforts and strong GDP growth in recent years have helped bring down the government's fiscal deficit. However, low tax revenues are a major concern.

The 2008-09 global financial crisis and recession exposed Sri Lanka's economic vulnerabilities and nearly caused a balance of payments crisis. Agriculture slowed due to a drought and weak global demand affected exports and trade. In early 2012, Sri Lanka floated the rupee, resulting in a sharp depreciation, and took steps to curb imports. A large trade deficit remains a concern, but strong remittances from Sri Lankan workers abroad help offset the trade deficit. Government debt of about 80% of GDP remains among the highest in emerging markets.