23 June 2021 08:52 am Views - 101
By Kelum Bandara
In an admission of reality in the pandemic -hit economy , the Cabinet of Ministers was apprised of the challenges confronting the government in the economic front in terms of reduced state revenue, dwindling foreign reserves and spike of import prices of items such as fuel , Daily Mirror learns.
A top government source told Daily Mirror that State Minister of Money, Capital Markets and Public Enterprise Reforms Ajith Nivard Cabraal briefed the Cabinet on Monday evening and asked for responses to tide over the challenges and to spur economic growth once again.
The government is likely to proceed with or even tighten further the import restrictions as a measure for saving foreign currency reserves and reducing the trade deficit. According to the Central Bank, the cumulative deficit in the trade account during January – April 2021 widened to US $ 2,948 million from US $ 2,693 during the corresponding period of the last year.
Tourism is a major foreign exchange earner for Sri Lanka under normal circumstances. It is an industry bringing in US $ 4 billion in revenue for the country. However, earnings from tourism dropped to as low as US $ 19 million during the first quarter of the year.
The latest statistics of the Central Bank said that inflation increased to 6.1 per cent in May from 5.5 per cent in April.
Minister Cabraal will also make a statement in Parliament today outlining these challenges and steps being taken to address the situation.
It was brought to the notice of the Cabinet that some traders import items circumventing present restrictions.