Japan Optimistic on Sri Lanka’s Economic Resurgence

COLOMBO (News 1st); Sri Lanka welcomed Japan’s Finance Minister Suzuki Shunichi on a two-day visit aimed at solidifying economic relations and exploring avenues for future cooperation. 

Japan’s Finance Minister Suzuki Shunichi called on Sri Lankan President Ranil Wickremesinghe on Thursday (11). 

According to the President’s Media Division this visit is particularly significant amidst the economic challenges faced by Sri Lanka, prompting the implementation of comprehensive reform measures focusing on macro stability and debt sustainability.

The Japanese Finance Minister, expressed strong admiration for President Ranil Wickremesinghe, noting significant improvements in Sri Lanka’s economy.

The President expressed profound appreciation for Japan’s lead role in addressing Sri Lanka’s debt issues. 

Japan’s Finance Minister Suzuki Shunichi acknowledged the completion of the first review under the IMF program and highlighted the international community’s recognition of the challenging reforms undertaken by Sri Lanka.

“There was strong recognition on that as well as all the other reforms. So congratulations. I think it really shows that you are tackling this extremely severe crisis with all the vigour that is needed to have Sri Lanka emerge from the crisis. I think there are very encouraging signs that the program is beginning to work, that the economy is stabilizing. So there’s, of course, all the signs with respect to policy-oriented variables in the fiscal area. With respect to revenue collection, in fact, we had a meeting that showed very encouraging numbers that basically highlight that the policies you implemented, beginning from after we reached the staff level agreement in the second half of 2022, are working, that they have the intended effect, that you’re collecting the revenue that’s needed to address the cause of the crisis. So that really is very good news.”

The Japanese Finance Minister, expressed optimism about positive surprises in the economic situation, emphasizing their potential to boost confidence internationally with official and private creditors. 

He highlighted the authorities’ commitment to reforms, citing achievements such as significant reduction in inflation through monetary policy efforts, successful increase in reserves, and the initiation of governance reforms. Additionally, he mentioned positive signs of economic growth in the third quarter, indicating an overall favorable outlook.

The Sri Lankan delegation briefed the Japanese counterparts on the progress of the debt restructuring with the insistence that the target for the completion of the debt restructuring would be within the 1st quarter of the year.