World Bank forecasts Sri Lanka's economic growth to slow to 2.7 pct

Source: Xinhua| 2019-10-15 18:04:02|Editor: Yurou
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COLOMBO, Oct. 15 (Xinhua) -- Sri Lanka's economic growth is expected to slow to 2.7 percent in 2019 and recover next year but depends on how it ensures political stability and continues reforms to strengthen revenue, the World Bank was quoted as saying by local media reports here Tuesday.

"The medium-term outlook is subject to the country's ability to ensure political stability and a return to normalcy," the World Bank said in a new report on South Asia.

"Growth for 2019 is expected at 2.7 percent, as many important economic sectors show relatively weak performance," the report added.

However, the World Bank said that in the medium-term, the economy is expected to recover from the disruptions in 2019, and growth to accelerate towards 4.0 percent, gradually closing the output gap.

The drivers of the recovery are anticipated to be investment and exports, as performance in the tourism sector improves and uncertainty is resolved after the elections are held, the report said.

"Risks are tilted to the downside. On the domestic front, a challenging political environment, delays or reversals in efforts to strengthen revenues, and a slower than expected recovery of some key economic sectors represent important risks."

Shifting to a private investment-tradable sector-led growth model by improving trade, investment, innovation and the business environment in the island country is also needed along with better governance and state enterprise performance.

Sri Lanka will hold a presidential poll on Nov. 16, followed by parliamentary polls in 2020.