WE MUST MOVE TO AVERT TWIN DISASTERS
Q: How do you view Sri Lanka’s COVID-19 response so far? What are the pros and cons?
A: The coronavirus (COVID-19) and its effect on the world economy is unprecedented; and as such, in my opinion I think the Sri Lankan government has done quite well so far especially if you compare its approach against global and regional reactions. Now the question remains as to how it intends to revive the economy while protecting public health.
Due to the nature of the situation, there will be lessons that must be learnt for both governments and businesses alike, so it is difficult to fault either side for cons and missteps taken in their approach to tackling the virus.
In order to balance public health, we have all been under lockdown for more than a month. This cannot be continuous and strategists really need to begin considering how we can revive economic activity. It is good that some districts have been opened and I had hoped that we will be fully active by 27 April. We won’t see a virus free situation any time soon and must adapt accordingly or else there will be a disaster on two fronts.
Q: As for state finances, should we print money despite the obvious repercussions and/or seek more funding from global lending institutions and other channels?
A: These are two different issues. As sufficient funding from lending institutions won’t come overnight, the state may have to print money in the short term. No one could have predicted this crisis; and here in Sri Lanka, we have witnessed the tourism industry being battered and remittances coming down drastically.
Once we begin to address the immediate deficits caused by the virus, we can then look toward seeking more funding and money from lending institutions and donor countries.
Q: What is the outlook for jobs and employment in the medium term? And how should the authorities address the prospect of rising unemployment?
A: If you can save jobs right now that would be a big victory. The private sector, which includes both larger companies and SMEs, has been affected and there will be job cuts. We were just getting the economy into order following the Easter Attacks in April last year; and now, we must contend with this global pandemic. Given this context, Sri Lankans will have to endure some hardships for the foreseeable future.
If we can protect existing jobs with salary cuts, this would be ideal; but some instances might require layoffs, unfortunately. Larger companies could probably afford salary cuts but SMEs will likely have to suffer layoffs. We must look at the situation for SMEs that cannot sustain their employees and approach the situation holistically, and keep in mind the impact direct and indirect employment.
ABOUT LMD’S A LISTERS
BOOST TO REAL ESTATE INVESTMENT
Q: What are your expectations of the business environment in the next 12 months or so? A: With the reduction in interest rates and increase in money circulation, people have a greater tendency to invest in real estate over the money market amidst the pandemic. We have seen similar patterns even in developed markets such…
EMERGENCE OF A NEW ECONOMY
Q: How did the pandemic necessitate a digital economy? A: Countries were not prepared for the COVID-19 pandemic’s impact on the economy and people, but it has resulted in the emergence of a new economy and way of life. It is technology, and the spirit of humans to survive and push past boundaries that have…
PRIORITISING CRUCIAL SECTORS
Q: What are your expectations of the business environment in the next 12 months or so? A: I believe that business is not likely to pick up until at least mid-next year for the hospitality sector. Business was nonexistent and as a measure to prevent exorbitant losses, we converted our hotel into a quarantine centre…
A POSITIVE AND FLEXIBLE PATHWAY
Q: Do you expect the national economy to pick up this year? A: If the third wave of the pandemic is brought under control as soon as possible, then we can expect the national economy to pick up towards the second half of the year. To ensure this happens, the vaccine must be sourced in…
RELIABLE PARTNERS IN A CRISIS
Q: In brief, what are the main challenges confronting corporates at this time? A: I think corporates today are besieged with a plethora of problems caused by the prevailing situation. First and foremost is the challenge in keeping their workers safe from COVID-19, and flowing from that is the inability to keep production cycles running…
IN A STATE OF DELEVERAGING
Q: How do you perceive the economic climate at present? A: I would like to really think about the state that the country’s economy is in. Our debt repayments are much higher than our income and this puts Sri Lanka in a state of deleveraging. This recently manifested itself in a 14.2 percent increase in…
EVER EVOLVING EXPECTATIONS
Q: What modern-day challenges do businesses face? A: Information overload – in the new world we live in, there’s never a lack of information. About 2.5 quintillion data bytes are added every day; more data is created in a single day than the combined amount generated over 99 percent of human history. Previous generations of…
EXPANDING CREDIT FACILITIES
Q: What is the bank’s corporate strategy for 2021/22? A: DFCC Bank’s 2021/22 plan is based on our five year strategy for 2020-2025 with the aim of making it one of the most customer centric and digitally enabled banks by 2025. Our lending plans will align with the government’s budget proposals to facilitate the growth…
REMAINING IN THE SPOTLIGHT
Q: What are Sri Lanka Tourism Development Authority’s (SLTDA) priorities for 2021/22? A: The global tourism industry will continue to experience a huge shift in the way of doing business. Our innovative bio-bubble concept launch in January was recognised at ITB Berlin. We hope this will boost traveller confidence. Therapeutic destinations and experiential travelling are…
