auto-update week 21

south-asia/ce.json

@@ -673,7 +673,7 @@
   },
   "Economy": {
     "Economic overview": {
-      "text": "<p>Sri Lanka is attempting to sustain economic growth while maintaining macroeconomic stability under the IMF program it began in 2016. The government's high debt payments and bloated civil service, which have contributed to historically high budget deficits, remain a concern. Government debt is about 79% of GDP and remains among the highest of the emerging markets. In the coming years, Sri Lanka will need to balance its elevated debt repayment schedule with its need to maintain adequate foreign exchange reserves.</p> <p> </p> <p>In May 2016, Sri Lanka regained its preferential trade status under the European Union’s Generalized System of Preferences Plus, enabling many of its firms to export products, including its top export garments, tax free to the EU. In 2017, Parliament passed a new Inland Revenue Act in an effort to increase tax collection and broaden the tax base in response to recommendations made under its IMF program. In November 2017, the Financial Action Task Force on money laundering and terrorist financing listed Sri Lanka as non-compliant, but reported subsequently that Sri Lanka had made good progress in implementing an action plan to address deficiencies.</p> <p> </p> <p>Tourism has experienced strong growth in the years since the resolution of the government's 26-year conflict with the Liberation Tigers of Tamil Eelam. In 2017, the government promulgated plans to transform the country into a knowledge-based, export-oriented Indian Ocean hub by 2025.</p>"
+      "text": "<p>Sri Lanka’s economy has historically relied upon government-guided market investments, and since 2009, several sectors have been excluded from any privatization efforts. Major infrastructure development of rural and civil war-impacted areas remains a major focus, as does small business development. Sri Lanka’s longstanding high debt and large civil service have contributed to historically high budget deficits and remain a concern. Sri Lankan tourism soared since the end of conflict with the Liberation Tigers of Tamil Eelam, but the 2018 constitutional crisis, the 2019 Easter bombings, and the ongoing COVID-19 pandemic have since destabilized this key industry, leading Sri Lanka to nearly expend all foreign currency reserves. Regionally, Sri Lanka has engaged China on major infrastructure projects and currently owes $6.5 billion, which may soon be restructured.</p> <p>Fiscally, Sri Lanka’s focus on domestic goods—instead of export growth—further increased Sri Lanka’s trade imbalance, despite its EU preferential trade status allowing tax-free garment and gem exports to the EU. From 2019 until its repeal in 2021, Sri Lanka’s agricultural import ban on chemical fertilizers resulted in disastrous reductions in rice, tea, and rubber yields, increasing Sri Lanka’s import dependencies for these goods. The ongoing Russo-Ukrainian War has also decreased fuel supplies and significantly increased prices. India is providing both direct fertilizer and fuel aid to offset these shortages. Power shortages plague business climates, and further stoke existing labor shortages. Additionally Sri Lanka is also considering privatizing several state-owned entities to try to spur industrial and service sectors’ growth.</p> <p>Monetarily, Sri Lanka remains in a dire position, further exacerbated by the 2019 tax cuts that contributed to the country’s ongoing economic calamity. Already one of the highest indebted emerging markets, Sri Lanka defaulted on its current public debt payments in May 2022, and its ongoing currency crisis has crippled domestic revenues, tax collections, and economic activity, ushering in the country’s worst economic crisis since independence in 1948. As a result, inflation is skyrocketing (nearing 40%), and food, fuel, and medicine shortages have led to widespread unrest and economic collapse. Sri Lanka currently seeks an immediate $3 million IMF bridge loan and $75 million in foreign currency to pay for essential goods and fuel.The World Bank, India, and the G7 countries have agreed to aid Sri Lanka in securing debt relief, but the IMF maintains that Sri Lanka must raise interest rates and taxes to secure any loan.</p> <p>Current Sri Lankan priorities focus on the following goals:</p> <ul> <li>Securing a bridge loan from the IMF;</li> <li>Improving its foreign currency reserves through continued promotion of tourism and privatization of state enterprises;</li> <li>Recovering from COVID-19 pandemic-related economic disruptions and demand shocks;</li> <li>Identifying alternative fuel supply chains; and</li> <li>Restructuring preexisting infrastructure debts to China.</li> </ul>"
     },
     "Real GDP (purchasing power parity)": {
       "Real GDP (purchasing power parity) 2020": {