Sri Lanka reforms urgent, govt borrowing to meet daily needs: Central Bank

ECONOMYNEXT – The Sri Lankan government is forced to borrow to even meet its daily spending requirements, making structural reforms that would raise revenue and reduce the budget deficit urgent, a senior Central Bank official said.

The performance in government finances reflects serious structural weaknesses in the government budget, said Mahen Siriwardana, director of economic research of the Central Bank.

There is a “sizeable deficit” of 2.2 percent in the revenue account of the budget, he said giving a speech on the state of the economy as reflected in the Central Bank’s annual report for 2015.

“The country’s revenue is not enough even to finance the maintenance expenditure of the government,” Siriwardana said.

“The government is forced to recourse to borrowings even for its day-to-day operations.”

This weakness in the structure of the budget limits resources available for development needs, said Siriwardana.
(COLOMBO, May 11 2016)

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