IMF impressed on Sri Lanka’s strong economic growth [November 1 2010]

The International Monetary Fund (IMF) said that Sri Lankas overall economic conditions are improving as expected, and the economy would show strong growth this year. However, the IMF stressed the need to reduce the deficit and take action on tax reforms which have been delayed by one year.

In a comprehensive report released on the US$ 2.6 billion stand-by-arrangement to Sri Lanka, the IMF said the economic conditions have shown remarkable progress with low inflation which is expected to be remained in single digits for the year, strong external balances, a high rate of remittance inflows, comfortable levels of gross reserves and rapidly improving tourism prospects.

The report noted that although the immediate risk of a balance of payments crisis has receded and much progress has been made in rebuilding reserves and advancing financial sector reform, 2009 was a lost year in terms of deficit reduction and tax reform.