US-EU slowdown to affect Lanka

16 June 2012 01:20 am - 7     - {{hitsCtrl.values.hits}}

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While saying that the economic slowdown in Europe and the United States would adversely affect Sri Lanka’s economy reducing the growth rate to 6.75 per cent this year, The International Monetary Fund (IMF), yesterday expressed its willingness to give further  financial and technical assistance to Sri Lanka after the completion of the Stand by Arrangement of US$ 2.6 billion.

Upon conclusion of the IMF staff mission to Sri Lanka from June 4 to 15, Asia and Pacific Department Deputy Division Chief John Nelmes told journalists that inflation was likely to rise to the upper single digit level this year.

“Sri Lanka’s export market is in Europe and the United States. Certain things are beyond the control of Sri Lankan authorities,” he said.
Mr. Nelmes said a delegation would probably come in September to discuss further arrangements with the IMF.

Referring to the last tranche of the present Stand by Arrangement, he said it would be decided upon after a review of policy action and economic development in Washington.

Stressing that it is important for Sri Lanka to achieve the budget deficit target, Mr. Nelmes said the government’s revenue target was underperforming due to factors such as import cuts and the energy crisis.

In this case, he said, the IMF was ready to give technical assistance to Sri Lanka. While commending the government for making policy decisions to maintain flexible exchange rates and adjust fuel prices, he said the authorities were successfully implementing a bold package of policy measures to curb current account deficit and safeguard reserves.

“Credit growth has slowed and imports have declined ,” he said. (Kelum Bandara)

  Comments - 7

  • Nodrog Saturday, 16 June 2012 12:54 PM

    But the Govt will continue to squander and swindle at the same rate...no slowing down there!

    Countryman Saturday, 16 June 2012 03:56 AM

    Welcome it is more money for the present scene.

    Barath Saturday, 16 June 2012 04:09 AM

    Going well with IMF proposals. People feel the heat.

    carlos Saturday, 16 June 2012 04:17 AM

    that's not a problem at all. Our government will come up with a formula that will turn the negative 6.75 into positive. our politicians are very good in maths.

    raj Saturday, 16 June 2012 04:49 AM

    Now one our minister will say that the USA is slowing down its economy so Sri Lankan economy will get affected. An International conspiracy!

    Naman Saturday, 16 June 2012 05:00 AM

    Try balancing thhe budget.
    Reduce foreign travel,
    Reduce the expenses on military & on the white van.
    Stop stealing national wealth,
    Stop using government money on election campaign
    Stop the corruption
    Etc etc

    Mahen Sunday, 17 June 2012 06:16 PM

    LKR is ready for another show? Will it stop around 140's or will it push all the way to 160's per $ ?


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