While Sri Lanka s monetary meltdown acceleration with historic low interest rates driven by money printing after the tax cuts of 2019, the storm gathered pace from 2015, when rapid foreign debt accumulation greater than the annual foreign financed deficits began.
The setback due to the pandemic has aggravated some of the perennial macro-economic and sectoral problems in Sri Lanka. For example, borrowing and accumulating external debts has been a practice of successive governments since 1978, which was the year of partial liberalization of the economy. During the early periods, when Sri Lanka was considered a low-income country, we were entitled to substantial grant aid as well as concessionary finances.
This relatively low interest facilities and lenient conditionalities provided incentives for the governments to keep borrowing for many development projects, from bi-lateral and multi-lateral lending agencies, irrespective of inflated costs of many of these projects. In most of these cases, financial benefits also have spilled over to Sri Lankan politicians, bureaucrats, and technocrats. Notwithstanding such leakages, these foreign funded projects increased the availability of more sophisticated infrastructure and utilities in sectors suc
16 firms raise over Rs 31,000 crore via IPO in 2020 sakshi.com - get the latest breaking news, showbiz & celebrity photos, sport news & rumours, viral videos and top stories from sakshi.com Daily Mail and Mail on Sunday newspapers.