IMF slashes SL’s 2021 economic growth forecast to 4%

The International Monetary Fund (IMF) in its latest World Economic Outlook report has slashed Sri Lanka’s economic growth rate forecast for this year to 4 percent from 5.3 percent it forecasted in October, 2020.  

The revision is similar to that of the forecast of the Asian Development Bank (ADB), which expects Sri Lanka to grow by 4.1 percent this year.

However, the Central Bank of Sri Lanka (CBSL) has a more optimistic economic growth prediction, expecting the country to grow by 6 percent in 2021.

In 2020, due to the impacts stemming from COVID-19 pandemic, the economy recorded a negative growth rate of 3.6 percent.

The Central Bank continues to maintain its stance that economic growth is expected to rebound in 2021, and an upward trajectory will be maintained in the medium term with the support of pro-growth policies of the government. 

Last month, the Central Bank forecasted 3-3.5 percent growth for the first quarter of this year adding that the ongoing vaccination drive has helped in boosting the confidence of people and businesses, which contributes to improved prospects of recovery and growth.