2016年-IMF国际货币组织全球_Sri_Lanka_Fourth_Post_49页_2mb

Summary of IMF Country Report No. 16/152: Sri Lanka

Core Content

The IMF conducted the Fourth Post-Program Monitoring (PPM) discussions with Sri Lanka in November 2015, following a period of economic developments and policy adjustments. The report outlines key economic indicators, fiscal and monetary policy challenges, and external sustainability concerns. It emphasizes the need for fiscal consolidation, monetary tightening, and structural reforms to address macroeconomic imbalances and improve long-term growth prospects.

Main Points

Economic Developments and Outlook

• Growth: Real GDP growth for the first half of 2015 was 5.6%, up from 1.3% in the first half of 2014. Growth momentum remains firm, with projections of 5.2% for 2015.
• Inflation: Headline inflation fell to -0.3% in September 2015 but rose to 1.7% in October. Core inflation increased to 4.4% in October, indicating underlying inflationary pressures.
• Fiscal Deficit: The fiscal deficit for the first half of 2015 was 3.7% of GDP, slightly higher than the first half of 2014. Revenue growth was below budget expectations, while recurrent spending increased significantly due to higher public wages and salaries.
• Public Debt: Public debt as a percentage of GDP rose to 75.0% in 2015, with a very low tax-to-GDP ratio and high current expenditure constraining fiscal space.
• Balance of Payments: The current account balance deteriorated, with imports rising sharply and exports declining, leading to a substantial reduction in central bank foreign exchange reserves.

Monetary Policy

• Interest Rates: Policy rates were reduced by 50 bps in April 2015, reaching a new historical low. There is little room for further easing due to rising core inflation and the need to stabilize the currency.
• Credit Growth: Private sector credit growth accelerated, and the CBSL has kept monetary policy unchanged. The absence of daily interventions in September led to a nominal depreciation of the rupee, but daily interventions resumed after a week.
• Monetary Indicators: Reserve money and broad money increased, while domestic credit growth rose sharply. Call market rates have started to rise as government borrowing surged.

External Sector

• Exchange Rate: The rupee depreciated slightly in nominal terms but appreciated in real effective terms due to low inflation and currency volatility in major markets. The CBSL's exit from daily intervention in September increased pressure on the currency.
• External Pressures: Lower oil prices were offset by increased imports, declining exports, and reduced foreign investment. The current account balance is expected to remain negative, with a projected deficit of -3.9% of GDP in 2020.
• Foreign Reserves: Gross official reserves fell by $1.4 billion during January-September 2015, though a $650 million sovereign bond issue and swaps with the Reserve Bank of India helped stabilize reserves.

Financial Sector

• Performance: The financial sector remained stable, with increased profitability in both bank and nonbank sectors. However, there are pockets of vulnerability in nonbank financial institutions (NBFIs), particularly in liquidity and non-performing loans (NPLs).
• Credit Risks: NPLs increased, driven by lower gold prices and delinquencies from trade with Russia. NBFIs showed improved performance but still face liquidity issues.

Policy Recommendations

• Fiscal Consolidation: Authorities should implement ambitious fiscal measures in the 2016 budget to reduce the fiscal deficit and improve debt sustainability.
• Monetary Tightening: The CBSL should consider tightening monetary policy gradually to address inflationary pressures and stabilize the currency.
• Structural Reforms: Improvements in the business climate, state-owned enterprise reforms, and an open trade regime are critical to enhancing competitiveness and growth.
• Exchange Rate Flexibility: Greater exchange rate flexibility and reduced foreign exchange intervention are needed to improve the external balance.
• Tax Reform: A comprehensive reform of tax policy and administration is essential to increase revenue and reduce reliance on external financing.

Key Information

• Political Transition: A new government under the UNP and opposition formed in August 2015, leading to significant institutional changes, including the reorganization of ministries and the transfer of some functions from the Ministry of Finance to new entities.
• New National Accounts: The GDP series was rebased from 2002 to 2010, leading to a revised estimate of potential growth at 5.5%.
• Tax Productivity: Tax revenues grew by 18.6% in the first half of 2015, but much of this was due to increased motor vehicle imports. VAT and income taxes underperformed compared to international standards.
• Public Finances: The central government balance has been negative, with a projected deficit of -5.7% of GDP in 2020. Public debt is expected to remain high, with risks of further increases.
• Debt Sustainability: A Debt Sustainability Analysis was prepared to assess Sri Lanka's external debt and its sustainability under current and projected economic conditions.

Conclusion

The IMF's assessment highlights the need for Sri Lanka to address fiscal and external imbalances, improve tax collection, and enhance competitiveness through structural reforms. While growth remains relatively strong, the risks to the economy are significant, particularly due to rising public debt, weak fiscal policy, and external vulnerabilities. The report calls for a more sustainable fiscal path, a gradual tightening of monetary policy, and greater exchange rate flexibility to restore macroeconomic stability and support long-term growth.