Dec 23, 2011 (LBO) – Sri Lanka will have to showcase better indicators than larger countries in the region to attract investments as a global downturn remains in place, an international economist who has a special focus on Asia said. To draw large volumes of foreign investment macro-economic stability and a good business environment was needed, Razeen Sally, a longtime London School of Economics professor who will shortly move to Singapore’s Lew Kwan Yew School of Public Policy said.
Small countries like Singapore and Hong Kong scored high on economic freedoms and the rule of law, but not all countries needed to go to that level.
“None of this has to be perfect,” Sally told the LBR-LBO CFO Forum, a gathering of senior business executives in Colombo.
“But they have to be better than they are in bigger markets like India, China and Indonesia. The challenge for a small country like Sri Lanka is to do these things better because foreign investors will be worried otherwise.
“Of course there are big deficits, to put it mildly.”
Sri Lanka’s macro-economic management has improved over the last few year with inflation held low and budget deficits, thought still high, being lower than in the