Sri Lanka: State of the Economy 2020
Pandemics and Disruptions: Reviving Sri Lanka’s Economy COVID-19 and Beyond
Sri Lanka’s very creditable health response to COVID-19 gives it an early advantage to tackle the economic fallout of the pandemic. All indicators suggest an economic contraction in 2020, albeit with a very real possibility of a sharp V-shaped recovery thereafter. Such a recovery presents both an opportunity and a challenge for Sri Lanka. The emergency stimulus measures will combat the immediate deflationary shock, but they can eventually stoke inflationary pressures and undermine a resilient recovery path.
Once the immediate COVID-19 crisis recedes, Sri Lanka has a very real opportunity to refashion its economic policy choices to determine the outcomes beyond COVID-19, and help greatly to mitigate risks of disruptive impacts from similar crises in the future. The disruptive effects on incomes and livelihoods, particularly in the context of large numbers in informal employment, with inadequate social protection cover, elevate the risks of widening existing income disparities in Sri Lanka.
The IPS’ annual flagship report Sri Lanka: State of the Economy 2020 examines the policy contours of a country that builds back better from COVID-19, under the thematic focus of ‘Pandemics and Disruptions: Reviving Sri Lanka’s Economy COVID-19 and Beyond’.