Time to Act is Now: Good to Learn from Others Mistakes

Sri Lanka is now a lower-middle-income country. Moving out of low-income country status and a reliance on handouts is certainly a source of pride for all Sri Lankans. However, this newly won status also places greater responsibilities on the shoulders of the policy-makers, particularly in the Central Bank of Sri Lanka (CBSL) and the Ministry of Finance. With lower-middle-income country status, a nation loses access to concessional resources (aid) and experiences greater exposure to the discipline exerted by commercial markets. This places a very high premium on prudent macroeconomic management based on timely action. The costs of policy mistakes have become dramatically higher.