Sri Lanka’s corporates would have breathed a collective sigh of relief in May as the Colombo Stock Exchange (CSE) opened for trading following an extended shutdown in the face of the COVID-19 outbreak and imposition of curfew.
The move came at a time when businesses were looking to get back on track given the hit they’ve taken as a result of the coronavirus. And despite the need to maintain caution in response to an unprecedented event such as COVID-19, there are signs that life is returning to the corporate sector.
There are economic issues to consider too, not least of which the projections made by global rating agencies.
For instance, Standard and Poor’s recently downgraded Sri Lanka’s sovereign rating to ‘B-’ amid tax cuts introduced earlier in the year together with import controls leading to concerns over fiscal policy while the COVID-19 pandemic threatens to reverse the growth curve.