Sri Lanka-Italy Biz Council hosts luncheon talk by IMF Rep

The Sri Lanka-Italy Business Council of The Ceylon Chamber of Commerce hosted a luncheon meeting titled ‘Sri Lankan Economy – Some Ideas About the Future’ for its members and non members. The gathering was addressed by Dr. Koshy Mathai, IMF’s Resident Representative in Sri Lanka and Maldives, who shared some important ideas relating to the economy.

Addressing the gathering Dr. Mathai mentioned that imports in the economy have fluctuated to an unparalleled degree and from a macro economic perspective, however useful imports are, they have to be financeable.

“The current account deficit is growing and measures need to be taken to stop this growth in the current economy and in order to reduce the financing need, there may be a need to slow down economic growth, let exchange rate weaken, make imports more expensive and exports more competitive, tighten monetary policies so that bank credit doesn’t keep growing at 34% as it was last year,” said Dr. Mathai.

He also pointed out that we may also need to tighten fiscal policy, perhaps through increasing energy prices which will put a dent in consumer pocket books and help to restrain their disposable income and therefore their propensity to import.

Dr. Mathai pointed out that Sri Lanka is a petroleum importing country and Sri Lanka has to find a way to finance the increased prices of petroleum. He also noted that there is large-scale machinery being imported for various industries and that Sri Lanka needs capital goods to come into the economy and we should not slow that down.

The council will have a series of Luncheon meetings in the coming months, affording an opportunity to its members to listen to speakers of repute on topics related to economy, current affairs, business etc making their membership meaningful.

The Sri Lanka Italy Business Council formed since October 1998, under the aegis of the Ceylon Chamber of Commerce. The Council focuses on the objectives of ‘promoting investment, trade and joint venture between Sri Lanka and Italy,’ is one of the 20 bilateral business Councils that function under the aegis of the Ceylon Chamber of Commerce. The groundwork for the formation of the Council was laid by a proposal made by the then Ambassador of Italy in Sri Lanka Maurizio Teucci to the Ceylon Chamber of Commerce, in 1997.

The speaker Dr. Koshy Mathai previously served as IMF’s Mission Chief for Fiji.  He took up his posting in Colombo in October 2009, before which he was based in Washington, where he worked on a range of countries including the U.S., Turkey, and Zambia. He has been at the IMF for 15 years. He completed his bachelor’s degree at Harvard and his Ph.D. at Stanford, both in economics.