Sri Lanka rides tsunami to keep economy afloat

International lenders downgraded Sri Lanka's economic growth forecasts for this year after tsunamis devastated its coastline, but the island is banking on a flood of foreign aid to keep its head above the water. International lenders downgraded Sri Lanka's economic growth forecasts for this year after tsunamis devastated its coastline, but the island is banking on a flood of foreign aid to keep its head above the water. The balance of payments, which were in deficit to the tune of 205 million dollars last year, is expected to swing to surplus thanks to foreign cash inflows after the December 26 tsunami, the Central Bank of Sri Lanka says.
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The rupee, which fell over 10 percent against the dollar last year, saw a big turnaround, gaining 5.2 percent in the first quarter of 2005 to become one of the world's best performing currencies.

Foreign reserves also improved to 3.54 billion dollars in March from 3.
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12 billion in November, official figures show.

"The tsunami has certainly given the country a new lease of life," said Alastair Corera, country head of Fitch Ratings. "The question now is how the restructuring of sectors that need attention will be carried out."

International lenders have bee