Sri Lanka to push ahead with Reforms

Sri Lanka will continue to press ahead with reforms and revenue for the start of the year is on target, junior finance minister Eran Wickramaratne said in an interview.

“We are more or less on track” with the reform program, said Wickramaratne, who represents the United National Party in the coalition government. A fuel price formula will be implemented as planned and sales of state-owned hotels will proceed, he said in Washington, where finance chiefs and central bank bosses are gathered for the IMF and World Bank Spring meetings.

Staying the course on reforms is key to Sri Lanka being able to tap loans from the International Monetary Fund, whose terms include a fuel pricing mechanism to help cut losses at state-run refiners. A March deadline for that step was missed. The south Asian nation took a $1.5 billion loan from the IMF in 2016 to stave off a balance of payments crisis.

In February, President Maithripala Sirisena reshuffled the cabinet for the second time since forming a unity government in 2015 after its two main coalition partners were defeated in local government elections. This month, he suspended the parliament until May 8 ahead of planned defections from his party to an opposition group led by former President Mahinda Rajapaksa.

Wickramaratne said exports continue to increase and he played down fears of a global trade war.

“There is a rise of populism globally and I think it’s a phase that will go through and eventually settle down to economic realism, which is that major trading partners will gain by coming to some kind of understanding,” Wickramaratne said. “I would say it is a glitch.” (Bloomberg)

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