“SL has taken difficult measures to put country on long-term sustainable footing”

Sri Lanka has taken difficult measures to put the country on a long-term sustainable footing and comply with the IMF commitments. “These are hard steps, and not always popular,” opined Ambassador Julie J Chung’s at Amcham CXO Forum “75 years and Beyond: U.S.– Sri Lankan Business Relations in 2024”

The commitments required by the IMF as part of the Extended Fund Facility program call for government reform measures in both tax compliance and combating corruption.The International Development Finance Corporation’s recent investment of USD 553 million in the Western Container Terminal at the Port of Colombo sends out a positive signal to potential investors and financiers that the USA believes in Sri Lanka’s future. “it also demonstrates the United States’ continuing commitment to the prosperity of Sri Lanka,”

She also disclosed that this investment is DFC’s second largest exposure in the entire Indo Pacific region. “The new higher VAT rates have been a hit on the average Sri Lankan and your businesses. We understand that while there may be short term necessary pains, the public deserves to know that such measures are being taken looking at the wholeness of the problem and endemic issues that must be addressed in a structural, sustainable way, fair and transparent to all.’Creating predictable customs duties and streamlined processes would encourage importers, who want to import more to Sri Lanka but are worried about the uncertainty in the import process. “Unpredictable customs fees discourage importers and limit the amount of customs revenue the Sri Lankan government can collect. This shifts the burden of tax revenue further onto the shoulders of the people, who can’t bear much more.”

Recently I met with the National Chamber of Exporters who relayed some of their challenges – red tape, regulatory challenges, and unpredictability that impact their businesses. Exports and private sector growth will be the engine of recovery, but they need the space and support to thrive.”“It’s important that the government of Sri Lanka carry out reforms. But it’s also important to explain those reforms to the people in a clear manner. It makes for slower, but better legislation and reforms.’As the largest export market for Sri Lanka, the United States can help be part of the solution.”

( Source : Daily News)