Gregory Smith Discusses Sri Lanka’s Economic Challenges and Opportunities on “Conversations with Alanki”

In a recent episode of “Conversations with Alanki,” Gregory Smith, Lead Economist at the World Bank, discussed Sri Lanka’s economic challenges and the way forward with host Alanki Perera. Smith outlined the country’s struggle with the aftermath of the Easter attacks, the COVID-19 pandemic, political upheaval, and the worst economic crisis since independence.

The World Bank, Lead Economist Gregory Smith noted the crucial support from the IMF, despite its stringent conditions, and highlighted that some reforms are beginning to yield positive results. He emphasized the importance of investing borrowed funds wisely to spur economic growth and criticized Sri Lanka’s historical over-borrowing without productive investments.

Structural issues such as inadequate governance reforms, a bias against export promotion, and insufficient foreign direct investment were discussed. Smith called for targeted reforms to attract more FDI and stressed the necessity of effective implementation of proposed reforms for sustainable growth.

Smith also discussed the need for a fair taxation system and the efficient use of tax revenue to maintain public trust. He expressed optimism about Sri Lanka’s potential, driven by its skilled workforce and entrepreneurial spirit, and highlighted the importance of reducing red tape to foster business operations.

Comparing Sri Lanka to India, Smith underscored the need for stability and consistent economic policies to avoid future crises. He supported the continuation of the IMF program and warned against significant deviations that could lead to high inflation and public unrest.

Smith concluded by urging Sri Lanka to focus on domestic policies to secure economic recovery and explore opportunities beyond tourism, leveraging its strategic location and potential in various industries for economic diversification and growth. (LankaXpress.com)