Central Bank cuts Sri Lanka’s growth forecast to 1.5-pct in 2020

Apr 28, 2020 (LBO) – Central Bank expects that the real GDP growth in Sri Lanka to decelerated to around 1.5 percent in 2020 before the economy recovers to attain its envisaged potential over the medium term.

“The COVID-19 pandemic will adversely impact the progress of the economy during the year, contrary to previous expectations of a rebound in economic growth,” releasing its Annual Report for 2019, the Central Bank said.

According to Central Bank, the nature of the ongoing COVID-19 pandemic is such that its impact on the performance of the Sri Lankan economy hinges on several uncertain factors.

These include the further spread of the pandemic, the intensity and efficiency of mitigation measures, the degree of supply disruptions, and the persistence of behavioural changes and other economic patterns, relevant to both the domestic and global economies.

Although the recovery of global economic activity is likely to be a slow process, measures to achieve normalcy in domestic economic activities could enable Sri Lanka to record a faster recovery, as domestic demand accounts for a significant portion of aggregate demand in Sri Lanka.

Related:

PwC expects real GDP growth in Sri Lanka to be less than 2-pct this year

Sri Lanka records a subdued growth of 2.3-pct in 2019: CBSL Annual Report