Home > Economic Updates > Monthly Economic Update - January 2020

Monthly Economic Update - January 2020

'

3 KEY INSIGHTS

  • Sri Lankan Economy Grew by 2.6% during the First Nine Months of 2019: World Bank Expects 3.3% growth in 2020

  • IMF Downgrades Global Growth to 3.3% in 2020 mainly due to slowdown in India

  • Trade war concerns eases temporarily with signing of Phase 1 of Trade Deal between China and the U.S.

 

Sri Lankan Economy

Economy Grew by 2.6% during first nine months of 2019:  During the period mentioned above, Sri Lanka grew at a slower rate of 2.6%, compared to the 3.3% growth recorded in the same period in 2018. The deceleration was mainly due to the economic impact of the 21st April attack.

Sri Lanka, the Third Slowest Growing Economy in South Asia in 2020: As per the World Bank projections for 2020, Sri Lanka is expected to be the third slowest growing economy in South Asian region, with a 3.3% growth.

Trade Deficit Narrowed Further: Trade deficit contracted marginally by 2.9% in November, with both exports and imports declining. On a cumulative basis, during the first eleven months of 2019, trade deficit contracted by 25% due to significant decline in imports and marginal increase in exports.

Tourist Arrivals Reached 1.9Mn arrivals in 2019: Sri Lanka ended 2019 with 1.9 Mn tourist arrivals, despite it being a crisis year with 21st April attack. In December, 241,663 tourists arrived in Sri Lanka which is the highest arrivals post April 2019. Both the arrivals and earnings of 2019 was still 18% lower than what was recorded in 2018.

Growth in Credit to the Private Sector Reached a record Low in November: Credit to private sector by commercial banks in November 2019, reached a record low of 4.4% compared to the 16.2% recorded in same period of 2018.  

 

Global Economy

IMF Downgraded Global Growth Outlook for 2020: The IMF downgraded global economic growth to 3.3% in 2020 from 3.4% estimated previously. A more subdued growth forecast for India accounts for the lion’s share of the downward revision. 

South Asia’s Growth Decelerates in 2019- WB: Growth in the South Asian region is estimated to have decelerated to 4.9% in 2019 as per the World Bank. The slowdown was pronounced in the two largest economies, India and Pakistan.

US-China Signs Phase I of Trade Deal: The US and China signed the first phase of a broader trade pact recently.  The deal commits China to more than double its purchases from American farmers in the first year and in exchange, the US agreed to reduce tariffs on USD 120 Bn in Chinese products from 15% to 7.5%.

 

Read Full Update

Research Analyst - Economic Intelligence Unit, The Ceylon Chamber of Commerce

Saumya Amarasiriwardane

Leave a Comment

Comments