Despite the growth focus of Sri Lanka’s 2021 budget, Moody’s said yesterday (23) that it does not expect it to provide a meaningful boost to output, while increased spending will add to fiscal pressures, a credit Negative. On 17 November, Prime Minister and Minister of Finance Mahinda Rajapaksa presented the proposed 2021 budget. The budget targets a 2021 fiscal deficit of 8.8% of GDP, compared with a revised 2020 estimate of 7.9% of GDP. “Alongside the 2021 budget, the Government presented its medium-term macro fiscal framework, which targets a reduction in the fiscal deficit to 4% of GDP, to bring down the Government’s debt-to-GDP ratio to 75.5% by 2025. This goal is supported by medium-term goals of real GDP growth at 6% or above per annum and revenue-to-GDP over 14%.

Source: The Nation November 24, 2020 01:18 UTC