Nov 17, 2020 (LBO) – Sri Lanka plans to bring down it budget deficit to 4 percent by 2025 from the current 9 percent, Prime Minister and
Finance Minister said in his budget 2021 speech.
“By 2025, the budget deficit is targeted to be 4 percent due to growth in tax revenue through the expansion of the economy and the trust placed on the management of public expenditure and public enterprises,” he said.
“I emphasize that it is our medium term vision to reduce the budget gap through increasing the economic growth up to 6 percent and increasing the government revenue from its current level of 9.7 percent to 14.1 percent.”
The Premier says it is planned to maintain the budget gap at 9 percent of the GDP for 2021 since the private investments which amounted to 32.3 percent of the GDP in 2014 has decreased up to 27.6 percent in 2019 and since it is required to provide a robust start by the government to revive the economic growth which had stagnated recently.
“I believe that we can manage this budget gap, due to enhanced opportunities to reissue local and international currency denominated debt at maturity.”
The expected economic growth rate for 2021 is 5.5 percent.