Country’s economy stable despite COVID-19 pandemic - Cabraal
State Finance Minister Ajith Nivard Cabraal told Parliament yesterday that while dealing with the COVID-19 pandemic, the country should also be mindful about the sustenance of the country’s economy as well.
He noted that the COVID-19 pandemic took the world by surprise.
“It was a great shock to the entire world. No one was prepared for it and it is a big question in everyone’s mind as to how we should deal with it and what effects it would have on the economy, etc.
However, we had to take certain short term measures to deal with the situation. We had to take certain decisions in order to manage the economy and our President and Cabinet were not afraid to take these urgent decisions. Had these decisions not been taken, it would have been a grave hindrance to the country’s progress,” State Minister Cabraal said.
He said the Government wasted no time in identifying the priorities and understood that the pandemic would not end in a short time span.
“But, the issue of how the government was going to address the economic repercussions had also come up,” he said.
“That is the reason we had to impose certain import restrictions. It was important to take certain decisions in order to maintain our economic stability. Many thought that it would not be possible to manage the economy and the rupee would devalue and the economy would collapse,” he said, adding that although some shed crocodile tears, within their hearts they hoped that the economy would collapse.
He said that even during the war, although some openly claimed that they hoped the Government would win the war, deep within their hearts they wished that the Government would fail.
Cabraal said that today there is a new normal and we need to adjust to it.
“Sometimes we may have to change our thoughts and the things we use. Like what many expected, our rupee did not devalue, our economy did not crash and our interest rates did not increase. In fact, we were able to overcome these adversities and even relax some of the import restrictions. Although many though we could not handle it we have managed to do so. We have also managed paid back our debts and even get the required medical supplies.”
He pointed out that despite bleak predictions by many that the country would crumble in the face of the COVID-19 pandemic, the Government has managed to steer the country through it all and overcome these challenges. “The IMF, World Bank and ADB had predicted a bleak picture in their regional reports regarding Sri Lanka’s ability to face the impacts of the COCID pandemic. They had predicted that Sri Lanka’s GDP growth rate for 2020 would go from- 4.6 to 6.7. In addition, they had predicted Sri Lanka would record poor exports, tourist arrivals, foreign earnings from migrant workers, high interest rates, higher trade deficit and inability to meet foreign debt repayments etc. However, despite these bleak predictions, the government and all state institutions worked hard and took measures to face this situation. As a result, these institutions have exceeded expectations and produced results,” he added.
Cabraal added that even the unemployment rates had reduced from 5.7 to 5.4, according to the second quarter statistics released by the Census and Statistics Department, noting that exports have grown to pre-COVID levels.