Mon Feb 17 13:27:46 UTC 2025: ## Sri Lanka’s Budget Promises 5% Growth Amidst Ongoing Economic Recovery

**Colombo, Sri Lanka** – Sri Lankan President and Finance Minister Anura Kumara Dissanayake presented his maiden budget on Monday, projecting a 5% growth rate for 2025. The budget, presented amidst ongoing recovery from the country’s 2022 economic default, prioritizes boosting exports, improving productivity, and attracting foreign investment to achieve this target.

The President highlighted positive economic indicators, including foreign currency reserves exceeding $6.1 billion and the strengthening of the Sri Lankan Rupee to approximately LKR 300 per US dollar. He also announced increases in minimum wages and public sector salaries to address the high cost of living impacting Sri Lankans. Exports are expected to reach a record high of nearly $19 billion.

Despite these positive projections, the budget acknowledges the continuing hardship faced by many citizens. High inflation in 2022, though now reduced, has left many struggling to meet basic expenses, resulting in a significant increase in poverty. The World Bank estimates the poverty rate reached 25.9% in 2023.

Economist and former Central Bank Governor Indrajit Coomaraswamy praised the budget as “safe and sound,” commending the President’s fiscal discipline. He emphasized the importance of the projected 5% growth in reversing recent poverty increases. Coomaraswamy also noted the budget’s “fair amount” allocated for social welfare programs.

However, activists representing poor families criticized the budget for its adherence to austerity measures imposed by the International Monetary Fund (IMF) program. They argue that the focus on debt servicing (half of the allocated expenditure) and minimal public investment fails to address the immediate needs of the population. Concerns were also raised regarding the adequacy of welfare benefits, which remain within the IMF’s prescribed limits. The Feminist Collective for Economic Justice called on the government to renegotiate the IMF agreement. The budget’s emphasis on fiscal responsibility, while welcomed by some, leaves many questioning whether it adequately addresses the ongoing economic crisis facing ordinary Sri Lankans.

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