IMF Mission and CCC discuss economy

An IMF Mission, which came to the country recently, as a part of the multilateral agency's Article 4 consultation process conducted annually with member countries, held a discussion at the Ceylon Chamber of Commerce on Monday evening.

The IMF group was headed by Deputy Division Chief of the Asia and Pacific Department, Todd T. Schneider and included the Chief Economist of the Asia and Pacific Department, Jiri Jonas, the IMF Resident Representative in Sri Lanka, Dr. Mrs. Eteri Kvintradze and IMF Senior Economist Kirthisri Rajatha Wijeweera.

The group was received by the Chairman of the Ceylon Chamber of Commerce, Suresh Shah while representatives from the export, spice, plantation, construction and apparel sectors were also present.

The Mission sought the views of the business sector, on the local business climate and also regarding the overall economic situation in the country.

Suresh Shah said the business community sees many positive trends in the economy and added that over the past few years the government has taken a conscious effort to contain the fiscal deficit, reduce interest rates and inflation.

The Chairman of the Chamber said that exports have picked up in the past few months and imports curtailed.

He said that the export sector needs to do much better than it has done in the past and convert the country's economy into an export centric one, to sustain growth at around 8% pa.

"We have challenges in terms of our overall debt position. The debt to GDP ratio has been moving in the right direction, but nevertheless, if you look at it from as a percentage of income of the government, debt servicing is still significantly high," said Shah.

The representatives of the business community said that Sri Lanka needs to attract more Foreign Direct Investment.

They said that some of the areas that need to be addressed are: a simplified process to obtain land for new investments as this is presently very tedious specifically with the Provincial authorities, ease the process for approval of foreign investment projects, address the problem of labour shortage and create more access routes for SME funding.