SL economic recovery: 11 key points from President’s speech

October 6, 2022 at 11:14 AM

  • President addressing the Parliament said that Japan will assist Sri Lanka in the Credit Reconciliation process & has agreed to co-chair the summit in negotiation with creditor nations. “We strove hard to restrengthen the bonds with Japan during the past few months. Now we have a green light from them.”
  • President informs Parliament that he briefed Indian Prime Minister Narendra Modi in Japan and received a positive response to overcome the economic crisis.
  • “Sri Lanka hopes to come to a common agreement with creditor nations including Japan, China & India. We also commenced dialogues with envoys from other countries that have already provided credit facilities. Following discussions with the creditor nations, we expect to discuss with private creditors such as the LondonClub on debt restructuring”.
  • “Government is aware of poverty among certain segments of society. We have taken measures to identify them & ensure their food security. Steps have been taken to provide fertilizer & seeds required for the upcoming Maha season”.
  • “According to the 2019 tax policies, 14% of the GDP was earned through taxes but the change in this policy resulted in tax revenue dropping to 8.5%. Now we have discussed with IMF & agreed to increase it back to 14%.”
  • “Every citizen contributes to the 80% of indirect taxes, even the poorest of the poor. Changing this situation is the need of the era.”
  • “If we are to maintain free education & health, we must maintain Govt. tax revenue at 18% of GDP. The Govt. must earn revenue through taxes as we will have no future if we keep printing money.”
  • President acknowledges that each MP has their own political affiliation but warned that they would all be able to realize their political aspirations only if the country comes out of the crisis. “I embarked on this political journey at great risk when no other political party/leader was willing to take the risk. We are forging this risky path slowly but steadily. The majority of the country supports this journey as they aspire for a decent life, country & future.”
  • President says as a short-term measure to build the foreign reserve, USD 2-3 Bn is expected from restructuring State Owned Enterprises and compensation for the Express Pearl ship disaster will also be added.
  • President says ADB has already assured a USD 500mn loan to Sri Lanka & after IMF certification a USD 1 – 3 Bn Bridging Finance facility is expected from the World Bank.
  • “This journey can be strengthened & expedited only with everyone’s support,” the President told parliament and called on all to put aside political vendettas and join this journey. “It’s easy to criticize, find fault & protest but finding solutions is hard. So, let’s unite & face the country’s challenges together. I invite all to join the mechanism of rebuilding the country through the parliament national council & parliamentary committees etc,” the President said. (NewsWire)