Tbilisi: Sri Lanka took decisive remedial measures during the last 2 years and decided to undertake difficult yet necessary reforms as corrective measures to emerge from an unbearable economic crisis, State Minister of Finance, Shehan Semesinghe, told the Asian Development Bank (ADB) Governor’s Business Sessions held here yesterday.
“We entered into a 4-year, extended fund facility with the International Monetary Fund in March 2023 that supported our reform program, along with reform programs supported by the ADB and the World Bank. The reforms that have been put in place by the government during the past two years have been able to restore a significant level of stabilization in the economy.”
“The improved macroeconomic conditions are visible in terms of improved fiscal conditions, recovery of foreign exchange reserves, improved external balances as evident in the current account surplus and appreciation of the currency, and the rapid decline in inflation to single digit levels. In this backdrop, the assistance being provided by ADB in several reform areas, that the Government has identified, is instrumental in the country’s stabilization measures and setting the stage for economic recovery and growth,” he said.
The Minister emphasised the need of designing new strategies jointly to tackle future issues and risks posed by various challenges such as inequality and poverty along with dangers arising from climate devastation, while paying attention to uncertainties in the region due to conflict and volatile commodity prices.
He said “reducing the impacts of climate change on the poor and vulnerable people in the Asia-Pacific region, who contribute comparatively little to global carbon emissions, should be a main focus in our development path. I take this opportunity to appreciate ADB’s commitment of USD9.8 billion in climate finance in 2023 to help the region’s developing economies reduce their carbon footprints and to mitigate the impacts of climate change.”
Semasinghe said ADB, as a regional development bank, has a major role to play in preparing its members to face the global development challenges providing adequate and updated knowledge and expertise to confront these problems and ensure sustainable development in an inclusive and balanced environment. Many of the developing member countries find difficulties in moving ahead parallel to the global trends in the backdrop of rapidly accelerating technological changes. Country focused approaches to match the global development agenda have to be promoted through sovereign and non-sovereign operations of ADB.
“Our Government is thankful to ADB for the assistance and guidance provided to Sri Lanka in the country’s economic recovery process as well as in the economic stabilization process and for being a massive strength to us throughout our most difficult phase in 2022. Back-to-back shocks and some policy missteps degenerated the macroeconomic conditions, resulting in major hardship across all sectors of the economy and society as a whole,” he noted.
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