Standard Chartered Bank launched Global Research Brief 2019 highlighting the economic environment that will be in operation this year and the challenges it poses for the country.
“We are confident the forum will provide some essential insights into global business and economic trends in the year to come,” Standard Chartered Bank of Sri Lanka CEO Bingumal Thewarathanthri said.
“Our agenda focuses on both providing banking and financial services and also to provide them access to industry-related information on economic trends and market dynamics,” he said.
Sri Lanka will post an economic growth rate of 4.2% in 2019 and this will increase to 4.5% by 2020, Also that in 2019 the main objective of Sri Lankan government would be servicing a debt of over US$ 6 billion in the first quarter.
“Sri Lanka has already settled US$ one billion and we are confident that the balance amount too could be raised . A US$ 2 billion sovereign bond, and US$ 1.1 billion through a SAARC Window, US$ one billion from Bank of China and the rest from the RBI (US$ 400 million) and other means with be instrumental in achieving this, Standard Chartered’s Global Research Team’s– South Asia Economist, Saurav Anand said speaking to the media in Colombo.
He said that to achieve these targets there should be micro stability and also the government will have to maintain a strict monetary policy, while the Central Bank too has to keep policy rates unchanged. “Overall 2019 would be a tough year for Sri Lanka,” he said.
On foreign inflows to Sri Lanka Anand said that with several elections due in 2019, there would be stronger FDI in 2020. He also predicted that the major FDI would be the Colombo Port City Development and for the Hambantota Economic Zone.
“This would be a good sentiment for investors,” said Anand who is responsible for macroeconomic coverage of Bangladesh and Sri Lanka, as well as some aspects of India.
Global Chief Economist, David Mann of Standard Chartered said that the economic wave that ASEAN enjoyed will soon focuses in the direction of South Asia. Commenting on the global economy he said that though there is a truce, the US China trade war tensions still remains.
“However the global economy would do better in 2019, since some of the main concerns like crude oil prices were unlikely to be high”.
Head of ASA FX Research, Divya Devesh said that one major factor to support the US dollar was the US growth which was strong. “However we now see that there is a slowdown in the US economy which in turn will somewhat help the US dollar to likely be lower.
This is due to Trump’s policies and would also positively reflect in Sri Lanka in term of the US dollar in 2019,” he said.