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World Bank forecasts 2.2% growth for Lanka in 2024, driven by tourism and remittance recoveries

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The latest Global Economic Prospects report from the World Bank forecasts a 2.2 percent growth for Sri Lanka’s economy in 2024, marking a positive revision of 0.5 percentage points from January. This upward revision is attributed to gradual improvements in remittances and tourism.

The June edition of the World Bank’s Global Economic Prospects report highlights that tourism and remittances have rebounded following the economic contraction in 2023. However, both sectors remain below pre-pandemic levels.

The report states, “In Sri Lanka, the economy is expected to expand by 2.2 percent in 2024—a 0.5-percentage-point upward revision from January—supported by modest recoveries in remittances and tourism. Growth is projected to strengthen further in 2025-26, reaching 3 percent in 2026, assuming successful debt restructuring negotiations and the implementation of structural reforms, which would offset the adverse impact of planned fiscal consolidation on growth.

“After contracting in 2023, economic activity has strengthened in Sri Lanka, with tourism and remittances also recovering, although they have remained below pre-pandemic levels.

“The report also forecasts a slowdown in growth for the South Asia (SAR) region, from 6.6 percent in 2023 to 6.2 percent in 2024, mainly due to a moderation in India’s growth from recent highs. Regional growth is expected to remain steady at 6.2 percent in 2025-26, supported by stable growth in India. Among other economies in the region, Bangladesh is expected to maintain robust growth, albeit at a slower pace than in previous years, while growth is set to strengthen in Pakistan and Sri Lanka. However, the outlook is clouded by downside risks, including disruptions in commodity markets due to escalating conflicts, potential abrupt fiscal consolidations, financial instability from high bank exposure to sovereign borrowers, extreme weather events, and slower-than-expected growth in China and Europe. Conversely, upside risks include stronger-than-expected activity in the United States and faster global disinflation.

“Several factors have contributed to reductions in external imbalances, such as narrowed trade deficits, increased remittances, and tourism recoveries across multiple countries. Additionally, continued import restrictions, particularly in Bangladesh, have played a role. Foreign exchange reserves have risen in countries like Pakistan and Sri Lanka, reflecting eased currency pressures and increased official flows, although reserves remain low in some nations.

“In the SAR region, economic spillovers from outside are generally limited due to lower international trade openness compared to other global regions. However, weaker-than-projected growth in major trading partners could dampen growth in countries like Bangladesh, Pakistan, and Sri Lanka. For instance, a significant portion of intermediate goods imports in these countries comes from China, and any downturn in Chinese activity could lead to material shortages and reduced economic activity.

“Upside risks to regional growth include stronger-than-expected activity in the United States, which could stimulate growth in large exporting countries like Pakistan and Sri Lanka. Another potential upside is greater progress in global inflation reduction, potentially leading to faster-than-expected easing of monetary policy, lower borrowing costs, and improved growth prospects.”



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Courtesy call by the Heads of Mission- Designate on Prime Minister

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The heads of mission designate to Sri Lanka paid a courtesy call on Prime Minister Dr. Harini Amarasuriya on 26th of March at the Prime Minister’s office.

The delegation comprised Dharshana M. Perera, High Commissioner – designate of Sri Lanka to Malaysia, Ms. Dayani Mendis, Ambassador and PRUN – designate of Sri Lanka to Austria, Ms. N.I.D. Paranavitana, Ambassador – designate of Sri Lanka to Ethiopia & African Union, Prof. (Ms.) M.I. Fazeeha Azmi,Ambassador – designate of Sri Lanka to Iran,  Saman Kumara Chandrasiri, Ambassador – designate of Sri Lanka to Israel, and  M. Farook M. Fawzer, Representative – designate of Sri Lanka to Palestine.

The Prime Minister, Dr. Harini Amarasuriya, extended her best wishes to the Heads of Mission–designate and underscored the importance of their forthcoming assignments in advancing Sri Lanka’s national interests emphasizing their collective role in contributing towards the socio-economic upliftment of Sri Lanka.

The Prime Minister further highlighted the importance of projecting a positive and credible image of Sri Lanka internationally, through consistent, professional, and strategic engagement in their respective host countries and multilateral platforms.

She encouraged the Heads of Mission to actively identify and facilitate high-quality investment opportunities, particularly in sectors aligned with Sri Lanka’s development priorities, with a focus on sustainability, innovation, and long-term value addition.

Particular emphasis was placed on the promotion and diversification of Sri Lanka’s exports, including the exploration of new markets and strengthening trade linkages.

The meeting was attended by the Secretary to the Prime Minister, Additional Secretary to the Prime Minister Ms. Sagarika Bogahawatta and heads of mission-designate.

[Prime Minister’s Media Division]

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SC finds Keheliya, others, guilty of violating FRs of public through corrupt drug procurement deal

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The Supreme Court yesterday held former Health Minister Keheliya Rambukwella and several senior health officials liable for violating the fundamental rights of the public over a controversial drug procurement carried out under the 2022 Indian Credit Line.

Delivering the judgment, a three-judge bench, headed by Chief Justice Preethi Padman Surasena, and comprising Justice Kumudini Wickremasinghe and Justice Janak de Silva, found that the procurement of medical supplies from an unregistered company, in breach of established procedures, had resulted in a serious infringement of public rights.

The Court ruled that the granting of a Waiver of Registration by the authorities was “wrongful, arbitrary and capricious,” and held that the direct procurement carried out on an unsolicited basis was unlawful. The transaction was accordingly declared null and void.

In a significant order, the Court directed Rambukwella to pay Rs. 75 million in compensation to the State from his personal funds.

The then Health Ministry Secretary Janaka Chandragupta and former Chairman of the National Medicines Regulatory Authority (NMRA), Prof. S. D. Jayaratne, were each ordered to pay Rs. 50 million.

The Court further directed NMRA Chief Executive Officer Dr. Wijith Gunasekara and former Director of the Medical Supplies Division Dr. Thusitha Sudarshana to pay Rs. 50 million each as compensation.

The ruling followed the hearing of a fundamental rights petition filed by Transparency International Sri Lanka and two other parties.

The Court also instructed the Commission to Investigate Allegations of Bribery or Corruption to initiate appropriate action under the Anti-Corruption Act against those found responsible.

Senior Counsel Senany Dayaratne, with Nishadi Wickramasinghe, Lasanthika Hettiarachchi, Janani Abeywickrema and Maheshika Bandara, appeared for the petitioners.

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Sajith nudges govt. to follow India’s example in giving relief to consumers by slashing taxes on fuel

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Opposition and SJB Leader Sajith Premadasa yesterday urged President Anura Kumara Dissanayake to reduce taxes on fuel, just as the Indian government has done.

He said in a post on X that “Modi government has decided to reduce the Special Additional Excise Duty on petrol and completely remove it for diesel in order to cushion the hardship on the Indian consumer. High time for Anura Kumara Dissanayake to keep up to his election promise and follow suit.”

Meanwhile foreign media reported that India has slashed excise duties on petrol and diesel to protect consumers and rein in a potential spike in inflation, while imposing windfall taxes on aviation fuel and diesel exports, amid volatile global oil markets, as a result of the Iran war.

Global oil prices have surged past $100 per barrel after the near closure of the Strait of Hormuz, which serves as a conduit for 40% of India’s crude oil imports, since the US and Israel first struck Iran on February 28.

In a government order, released late on Thursday, India’s Finance Ministry reduced the special excise duty on petrol to three Indian rupees ($0.0318) per litre from 13 Indian rupees earlier. It also cut the duty on diesel to zero from INR 10 rupees per litre.

The government did not say how much the duty cuts would cost. The move comes ahead of elections next month in four Indian states and one federal territory, with Indian voters known to be extremely sensitive to higher prices.

“Government has taken a huge hit on its taxation revenues to ensure very high losses of oil companies, approximately 24 rupees a litre for petrol and 30 rupees a litre for diesel, at this time of sky high international prices, are reduced,” Indian Oil Minister Hardeep Singh Puri said in a post on X.

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