COLOMBO, Aug 28 (APGM) - Sri Lanka has to sustain a high growth rate for over a period to reach the status of a high income economy, a top economist said on Wednesday.

Chairman of Sri Lankan National Economic Council Lalith Samarakoon, in an article published in Sri Lanka’s Daily FT newspaper on Wednesday, said the country had trapped in a growth conundrum. He opined in his article that though the economy continued to expand, the growth had been low and decelerating in recent years.

“The country needs structural and other reforms necessary and critical to unlocking impediments to growth,” he said in his article.  

He said Sri Lanka needs higher growth to contain the budget deficit.

“The level of public debt is high and unsustainable under the prevailing growth environment. Further deterioration of fiscal balance could lead to more borrowing by the government and build-up of more debt. Improving the trade balance and thereby the balance of payments deficit also require higher growth,” he said.

According to his article Sri Lanka has now reached the level of an upper middle-income economy.

“Achieving the high-income status will require higher and sustained growth. With reasonable assumptions regarding key variables influencing growth, five percent annual growth will take Sri Lanka about 20 years and six percent growth about 15 years to become a high-income economy,” he said.