Bandula calls for fresh policies to stabilize economy

MP Bandula Gunawardana

• Says Appropriation bill should be coupled with policies to cut expenditure, slash imports and stabilize rupee

By Nuwan Senarathna

United People’s Freedom Alliance (UPFA) MP Bandula Gunawardana yesterday called on the Government to introduce policies to stabilize the economy with the Appropriation Bill for year 2019. 

“Any appropriation without proper policies to attain economy stability will be just a bluff,” MP Gunawardana told reporters at Sri Lanka Podujana Peramuna (SLPP) headquarters. 

Gunawardana said that new policies should be introduced to strengthen the rupee and control depreciation through the Appropriation Bill. He noted that action needs to be taken to improve exports and minimize imports. 

“If the Government failed to take necessary measures to control currency crunch that could affect the balance of trade and cause high inflation,” he added.

He noted that rupee depreciation needs to be controlled carefully and on a steady pace to maintain sustainability in the economy.  “This is a very delicate task. Therefore I do not suggest to do it overnight, but if they don’t manage it, it could lead to serious consequences. I hope at least they will be able to improve the situation to bring the rupee value up against the dollar to Rs. 160.”

Gunawardana said interest rates needed to be brought down to single digit levels, to encourage local and foreign investors. He claimed that the higher interest rates had affected production costs, which eventually affected consumers.

“Higher interest rates is one of the biggest concerns in Sri Lanka. I was told by some local businessmen that they had closed down their business ventures due to higher interest rates, which increased their production cost,” he added.

Gunawardana said that the Appropriation Bill should propose ways to cut down the Budget deficit to 4% of Gross Domestic Production (GDP), noting that in order to narrow down the Budget deficit, Government expenditure needed to be reduced.

According to Gunawardana, Government expenditure should have been reduced by introducing new managerial methods. “If they plan to sell public properties to cut down Government expenditure, then it cannot be accepted. Therefore the Government should find new ways to curtail its expenses,” he said.  

Pic by Sameera Wijesinghe 

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