Jan 29, 2019

Top economist warns of further drop in economic growth Featured

Sri Lanka’s real interest rate could be lower than the 6.2 per cent as reported by Bloomberg, says former deputy governor of the Central Bank Dr. W.A. Wijewardena.

According to him, the country’s economic growth could drop lower due to the collapse of businesses and discouragement for future businesses owing to the failure by the businesses that have obtained high interest loans to earn profits.

Sri Lanka has the highest real interest rate, followed by Egypt (4.8 pc), Pakistan (4.3 pc), India (4.3 pc) and Turkey (3.7 pc), according to Bloomberg.

Dr. Wijewardena warns that this situation would persist if there are no major economic reforms together with the curtailment of state expenditure.