ECONOMYNEXT – Sri Lanka is expecting gross domestic product to grow a little under 5.0 percent in 2021, down from an earlier 6.0 percent, Central Bank Governor W D Lakshman said after the country went into a three week lockdown from the last week of May.
The government had to balance between keeping growth going and saving lives and it was necessary to strike a balance he said.
But Sri Lanka’s businesses had got used to operating under a lockdown and the May-June lockdown was not as tight as the first one in 2020, Governor Lakshman said.
Growth in 2021 is expected to be below 5 percent, but it will be positive, he said.
Sri Lanka forecasted a 6.0 percent growth for 2021 at the beginning of the year.
Sri Lanka’s economy contracted in 2020.
Inflation will also be within target in 2021, Director of Economic Research Chandranath Amarasekara said.
Though there were supply constraints, no major gain in aggregate demand was expected.
The 5.0 percent growth was also coming from a low base as the economy contracted in 2020, he said. (Colombo/June11/2021)