The International Monetary Fund (IMF) says Sri Lanka must focus on diversifying its export markets and producing an investment-friendly environment to preserve stability and growth, even as current tariff changes present obstacles to economic forecasting.Speaking at the 2025 Spring Meetings of the World Bank Group and the IMF Thursday (24 ), Krishna Srinivasan, Director of the Asia and Pacific Department, highlighted the intricacy added by current developments in Sri Lanka.You understand, speaking about unpredictability, which the MD mentioned this morning, as you just spoke about, the team remained in Sri Lanka not too long earlier, and they were in the midst of having conversations with the authorities when these tariffs were revealed, Srinivasan stated during the Regional Economic Outlook Asia and Pacific session, he added.So, for the team, it became rather tough to put together a macro structure, which takes into consideration the tariffs and the implications they have on development, on exports, and so on etc.
That was an example of how unpredictability can affect simply operations with nations.
The group is back here, and weve continued conversations with the authorities.He noted that tariffs have an especially considerable effect on Sri Lankas key industries.
The wider concern is that this is a nation which is affected by big tariffs.
Theres a garment sector, there are a lot of the impact on the garment sector might be rather considerable.
And there are other sectors also here.
The question, of course, is for countries like not just Sri Lanka, however all nations, they need to believe in terms of diversification of our export markets, greater combination within the region, all these things can help diversify, can actually assist you mitigate the risks which come with tariffs from one country.On financial investment, Srinivasan stressed the significance of supporting domestic activity without jeopardizing fiscal discipline.
Exceeding that, I believe when it comes to Sri Lanka, financial investment can still be propped up.
Again, we would state when we state investment, create the environment for domestic financial investment to get, not always through tax exemption rewards, keep your fiscal combination, keep your financial integrity undamaged, but promote financial investment by supplying an environment where private investment can flourish.He likewise acknowledged the progress made under the current IMF programme.
The program has led to a substantial amount of macro stability, which has actually resulted in growth picking up, inflation coming down.
So the time is ripe for Sri Lanka to start more comprehensive structural reforms, which will promote private investment and get development going on a more long lasting basis.