ECONOMYNEXT – Sri Lanka’s economy will not collapse under a National People’s Power administration but will be taken forward, leader Anura Kumara Dissanayake told the business community.
“We will first give a guarantee that this economy will not be allowed to collapse but it will be stabilized and taken forward under our pact with the people,” Dissanayake said.
“We are not doing populist politics. Today state workers are getting bonuses in competition. When one person says 25,000, the other says, we said it first. We are not in that game.
“We have understood deeply the status of the economy. This economy cannot bear big instant shocks. The economy is hanging by a thread. A small change can even lead to deadly results.”
“We will make changes in the economy after assessing the effects of any changes we make.”
The NPP will not unilaterally exit the IMF program.
“But there are some parameters we have to maintain,” Dissanayaka said. “These targets are not unhealthy.
“The problem is the path through which we will reach the targets. We will do the discussions within the framework.
“The stock market is falling due to the fear mongering by the President.”
Dissanayake said there was a debate about the role of the central bank.
“We need to have a forecast about the exchange rate, otherwise it distorts markets,” he said.
“For the stability of the financial markets it is important that there is an exchange rate that can be forecasted, interest rates that can be forecasted, and inflation that can be forecasted. That will help the stability of the economy.
“Otherwise there will be instability. We accept the right of the central bank to act independently in these matters. The discourse of the independence of the central bank emerged due to politicians using it to their ends.
“We respect the independence of the central bank. But we have to accept the changes in the economy, to reach the goals of the mandate of the people we expect their support.”
One state enterprise said the government has to have a role in some strategic sectors.
These included energy, finance and some areas where there should be a state stake.
The government will not operate businesses to make profits.
“We have identified the SOEs the government should have a stake in and those that do not,” Dissanayake said.
“We believe that there should be strong regulatory agencies. Many are not working properly. They are legally bound to give at a reasonable price at a quality.”
Dissanayake said he the NPP will not take away houses or assets from the people.
The fall of the economy has been due to a confusion about the role of the government and businesses and industry.
In the 21s century such accusations are not valid he said.
Give to Caesar what belongs to Caesar, and to God what belongs to God, he said.
Sri Lanka’s economic growth is held back by corruption, he said.
“We will create a situation where a business will no longer have to depend on corruption to do their work.”
Sri Lanka will have a national plan with targets for each sector. The government will give guidance to reach the targets he said.
“We can discuss with you these. You can invest fearlessly,” he said. “Now people fear how taxes are changed by the government. Special Commodity Level, or whether the taxes will be made zero. It happened to tiles.”
The government will give projections and tax breaks to invest he said.
The NPP administration will quickly bring several new laws he said.
The SMEs which are in debt trap will be revived.
“Starting new businesses is a little difficult,” Dissanayake said. “Recalling the experienced businesses will is the easiest thing. The Parate has been delayed for a year. We will minimize the repossesion and help them.”
(Colombo/Aug05/2024)