Jan 10, Colombo: The World Bank's January 2019 Global Economic Prospects Report says Sri Lanka's economic growth is expected to speed up slightly to 4 percent in 2019.
In Sri Lanka, activity accelerated to an estimated 3.9 percent in 2018 on the back of a recovery in the agriculture and services sectors and last year's recovery from adverse weather conditions is expected to continue in 2019, with 4.0 percent GDP growth.
The growth activity will be supported by robust domestic demand as consumption rebounds following natural disasters, and investment is boosted by infrastructure projects. The economic growth is projected to inch to 4.1 percent in the next two years.
The report noted Sri Lanka's external debt is sizable and current account deficits have deteriorated considerably.
The World Bank cautioned that the upcoming election cycle next year elevates political uncertainty and the challenging political environment could adversely affect the ongoing reform agenda and economic activity.
Meanwhile, the global economic growth is projected to soften from a downwardly revised 3 percent in 2018 to 2.9 percent in 2019 amid rising downside risks to the outlook, according to the World Bank.
In South Asia, regional growth is expected to accelerate to 7.1 percent in 2019, underpinned by strengthening investment and robust consumption.
India is forecast to accelerate to 7.3 percent in FY 2018/19 as consumption remains robust and investment growth continues. Bangladesh is expected to slow to 7 percent in FY2018/19 as activity is supported by strong private consumption and infrastructure spending. Pakistan's growth is projected to decelerate to 3.7 percent in FY2018/19, with financial conditions tightening to help counter rising inflation and external vulnerabilities. Nepal's post-earthquake momentum is forecast to moderate, and growth should slow to 5.9 percent in FY2018/19.
Growth among advanced economies is forecast to drop to 2 percent this year, the January 2019 Global Economic Prospects says.