Sri Lanka’s Call for a Manufacturing Economy
During a Cabinet decision notification press conference at the Government Information Department, Cabinet Spokesman and Mass Media Minister, Dr. Bandula Gunawardhana, emphasized that the only viable solution in the current economic climate is to establish a robust manufacturing economy. He urged for efforts to produce every possible product within the country’s borders.
Minister Gunawardhana highlighted the heavy reliance on foreign imports, leading to significant foreign exchange expenditures, particularly on finished products. Notably, essential food items such as rice, potatoes, onions, chillies, and lentils are among the commodities that contribute to the import bill. Due to insufficient dollar reserves and foreign exchange, the country faces challenges in sustaining such imports.
The ongoing deficit in the current account of the balance of payments is identified as one of the primary reasons behind the country’s economic hardships, compounded by a severe foreign exchange and balance of payments crisis. The continuous deficit is attributed to the country’s inability to generate enough export income to offset import costs.
Minister Gunawardhana emphasized that the traditional approach of settling deficits by securing loans from abroad is no longer sustainable. With limited access to loans and Letters of Credit, the importation of essential goods like medicines, fertilizers, chemicals, machinery, and food becomes increasingly challenging.
The Minister advocated for a pragmatic approach and emphasized that the most viable solution lies in creating a manufacturing economy. By encouraging domestic production and reducing dependence on imports, Sri Lanka can work towards self-sufficiency and bolster its economic stability. The promotion of local industries and products will not only strengthen the nation’s economy but also enhance its resilience to external economic challenges.