With World Bank participation…A-PAD hosts vital discussion on Sri Lanka’s economic outlook

Team A-PAD SL with the World Bank Economic Team

Richard Walker (extreme right), Senior Country Economist of the World Bank, explaining the key findings of the report

Participants engaging in a productive discussion on Sri Lanka’s economic outlook

The Asia Pacific Alliance for Disaster Management Sri Lanka (A-PAD SL) hosted an exclusive discussion on the latest Sri Lanka Development Update report launched by the World Bank. According to a press release issued by A-Pad, the event, held at its office in Colombo on December 9, attracted the participation of distinguished economists from the World Bank, senior representatives of leading private sector organizations, business chambers and industry associations. 

The discussion brought together key representatives from diverse sectors, propelling an insightful exchange of perspectives on Sri Lanka’s present economic climate and the way forward. The session provided a valuable platform for stakeholders to engage directly with the World Bank’s economists and share their expertise, raise concerns, and bring overlooked yet critical issues to light. The diverse group of participants also helped the World Bank team that authored the report to capture a wide array of sector-specific insights, concerns, and recommendations, enriching the understanding of the country’s economic realities. 

Sri Lanka Development Update (SLDU) is a bi-annual report that provides crucial insights into Sri Lanka’s economic outlook, touching on the challenges and opportunities faced by the country. Richard Walker, Senior Country Economist, and Shruti Lakhtakia, Country Economist, led the discussion, providing a comprehensive overview of the report’s key findings. Shabih Mohib, Manager, was also present and provided deeper insights on the findings.  

Some key aspects of the report are reproduced here.

Stabilization amid challenges: While Sri Lanka’s economy has stabilized, poverty, inequality, and vulnerability remain pressing concerns. Continued recovery in industries and tourism has aided stabilization, yet fiscal consolidation efforts, such as higher indirect taxes, have strained household budgets.

The diverse group of participants also helped the World Bank team that authored the report to capture a wide array of sector-specific insights, concerns, and recommendations, enriching the understanding of the country’s economic realities

Structural reforms are crucial: For the country to achieve sustained and inclusive growth, policy consistency and structural reforms in monetary, fiscal, and financial sectors are imperative. These efforts must be complemented by progressive revenue measures that address household impacts.

Unlocking export potential: Sri Lanka’s untapped export potential is significant, with an estimated $10 billion in annual exports, particularly in manufacturing. To realize this potential, reforms to reduce high tariffs and attract more investment are critical. Sri Lanka’s protectionist policies have hindered competitiveness, limiting its economic growth potential.

During the interactive roundtable session, participants provided feedback on the World Bank’s recommendations. Key discussions revolved around the following areas. 

Fiscal Reforms: The importance of recalibrating the government’s revenue structure to focus more on direct taxes was emphasized to alleviate the burdens of indirect taxes, which disproportionately affect households.

Investment Climate: Participants called for a clearer investment vision, fewer regulatory bottlenecks, and more robust support for private sector growth. The importance of re-establishing development banks to promote industrial and startup investments was also noted.

Sectoral Growth Opportunities: Experts discussed the potential for growth in tourism, agriculture, IT, and renewable energy sectors. Unlocking the agricultural sector’s value and improving Sri Lanka’s tourism offerings were seen as key drivers for economic diversification.

A-PAD SL’s Country Director Firzan Hashim, concluded the meeting by expressing gratitude to the World Bank for their support and for conducting a valuable and engaging discussion. The meeting underscored the critical importance of multi-stakeholder collaboration in addressing Sri Lanka’s economic challenges and identifying avenues for sustainable growth. The event was followed by a networking session, providing an opportunity for participants to further exchange ideas and engage with the World Bank team on the topics discussed.

As a platform committed to strengthening disaster resilience in Sri Lanka, A-PAD SL acknowledges that fostering a resilient and robust economy—supported by sustainable business growth and structural reforms—is essential for enhancing the nation’s capacity to withstand and recover from future disasters. For more information regarding the event can be obtained by visiting the website www.apad.lk