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ADB Deputy Country Director Utsav Kumar
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The Asian Development Bank (ADB) Deputy Country Director Utsav Kumar this week outlined five areas Sri Lanka must focus on to succeed in the Extended Fund Facility (EFF) extended by the IMF, adding the country has a long road to recovery.
“Sri Lanka encountered an unprecedented economic crisis following back-to-back contraction and is likely to be followed by a tepid recovery,” he said at ADB’s Serendipity Knowledge Program on Tuesday which focused on Sri Lanka’s economic crisis.
ADB Deputy Country Director’s five areas of focus include; social safety net, proper communication strategy, reform transparency on SOEs, staying in the course avoiding pitfalls and looking beyond the four years of EFF to put the economy on a stable footing.
“It is critical to address the root causes of Sri Lanka’s internal and external imbalances, for which an unwavering commitment to reforms is essential,” he said.
Looking at the characteristics of the Sri Lankan economy, he said if exports take a hit, it reflects on the overall economy and therefore the country should build and explore multiple industries to remain resilient to internal and external shocks.
In terms of potential sectors in 2023 and 2024, Kumar outlined agribusiness, manufacturing, gems, ICT and tourism.
“With fertiliser support being distributed for the farmers, the industry will see a boom in production and the tourism industry remains the best option subject to no major global economic shocks to contract the growth. The financial industry will have a muted growth,” he explained.
Kumar asserted that the continued progress on the IMF program remains the key factor to successfully overcoming the economic crisis, whilst noting that debt restructuring and negotiations will be the next few hurdles for Sri Lanka.
