Sri Lanka's economy shows signs of recovery: president

COLOMBO, March 6 (Xinhua) -- Sri Lanka's economy, which experienced consecutive contractions for six quarters from 2022 to the second quarter of 2023, began to show signs of recovery from the third quarter of 2023 onwards and international financial organizations forecast that the country is poised to achieve a growth rate of 2 percent to 3 percent in 2024, said President Ranil Wickremesinghe on Wednesday.

Wickremesinghe told parliament that in January 2024, 1,995 new companies were registered and inflation dropped from 70 percent in September 2022 to 5.9 percent by February 2024.

Interest rates have undergone a significant reduction, dropping from over 30 percent in 2022 to less than 10 percent in 2023, he said, adding that the decrease has brought relief to small and medium-sized enterprises and consumers, particularly as inflationary pressures ease.

Wickremesinghe said the usable foreign exchange reserves, which stood at less than 20 million dollars in mid-April 2022, have surged to surpass 3 billion dollars.

He said that in 2023 the balance of payments achieved a surplus in the current account for the first time since 1977 and this has led to a depreciation of the dollar from 363 rupees to 308 as of March 5.

The president added that the government is optimistic that negotiations on foreign debt restructuring will reach a successful resolution soon as it aims to reduce the annual foreign debt payments to 4.5 percent of the GDP, he said.