Sri Lanka private sector urged to increase investment

Nov 23, 2011 (LBO) - Sri Lanka's private sector has been called upon to make big investments using tax savings and gains from incentives given by government, and banks urged to lend more to small business. Treasury secretary P B Jayasundera said the government was managing to maintain public investment at around six percent of Gross Domestic Product or almost 500 billion rupees and expects the private sector to play its part.

The government expects the private sector to invest 2,000 billion rupees as more investments are needed to maintain high economic growth, he said.

"The reason why the government is keeping public investment at 6-7 percent is because we are expecting five times that investment from you," Jayasundera told a post-budget seminar held by Ernst & Young mainly for its clients.

"If we spend 500 billion rupees, the private sector must spend 2,000 billion. That's what we expect from you."

These levels of investment were needed from both the public and private sectors to maintain economic growth at its current pace of eight percent a year with the government managing to reduce the budget deficit and also inflation and interest rates.

"We we want the real econ to grow fa