Key View

• We at Fitch Solutions revise our forecast for the Standing Deposit Facility Rate (SDFR) and the Standing Lending Facility Rate (SLFR) to be maintained this year at 5.00% and 6.0% respectively by end-2021 (versus 5.50% and 6.50% previously forecast) and for the SDFR and SLFR to come in at 6.00% and 7.00% respectively by end-2022.
• We

Key View

• We at Fitch Solutions have revised down our 2021 real GDP growth forecast for Sri Lanka, to 4.0% from 4.5%, in light of a weakened economic outlook for H221 across the broad economy.
• Activity in the industrial and services sectors will be hampered by a lack of inputs, foreign currency for import, and lockdown measures.
• Agriculture

Key View

• We at Fitch Solutions maintain our

Key View

• We at Fitch Solutions maintain our forecast for the Central Bank of Sri Lanka to keep its Standing Deposit Facility Rate and the Standing Lending Facility Rate unchanged at 4.50% and 5.50% respectively throughout 2021.
• Despite economic risk from the Covid-19 outbreak, we expect the quickened pace of vaccine rollout coupled with the

Key View

• We at Fitch Solutions have revised down our 2021 real GDP growth forecast for Sri Lanka, from 4.8% to 4.5%, amid a resurgence in Covid-19 cases since April which has prompted the government to implement tighter containment measures.
• The industrial sector will continue to be the main driver of growth, benefitting from the robust

Key View

• We at Fitch Solutions expect banking profitability in Sri Lanka to improve in 2021 on the back of strong credit growth.
• We forecast credit growth to register at 25.0% in 2021, with the acceleration driven by public borrowing to fund additional pandemic relief measures, in light of Sri Lanka's third wave of Covid-19 outbreak.
• Asset

Key View

• We at Fitch Solutions have revised down our 2020 real GDP forecast to 4.5%, from 2.6%, amid a new wave of Covid-19 outbreak in the country since October. Accordingly, we have revised up our 2021 real GDP forecast to 4.8%, from 4.2% previously, due to more favorable base effects.
• We highlight that the economic recovery in 2021 will be

Key View

• Continued lack of medical funding and healthcare infrastructure exists in Sri Lanka’s public sector.
• The private sector offers significant opportunities to help reduce the financial and human resource burden, common within the public health sector.
• Private healthcare providers in Sri Lanka will continue to expand their presence in

Key View

• Investment in domestic pharmaceutical manufacturing will rise in Sri Lanka.
• Multinational firms have little incentive to invest and develop a large manufacturing presence.
• Sri Lanka's competitive environment remains skewed towards the State Pharmaceutical Corporation of Sri Lanka.

Efforts to increase domestic investment in Sri

Key View

• We at Fitch Solutions have revised down our forecast for Sri Lanka’s real GDP growth to come in at -2.6% in 2020, from -0.4% previously, as the extension of curfews in Q220 would have dragged economic activity further than we had previously expected.
• Sri Lanka’s real GDP contracted by 1.6% y-o-y in Q120, as Covid-19 lockdowns since