President addresses VAT increase and economic stability at industry excellence awards ceremony

President Ranil Wickremesinghe, on Wednesday night, speaking at the National Industry Awards ceremony, acknowledged the challenging decision to increase the Value Added Tax (VAT) to 18 percent, emphasising the imperative need to maintain economic stability.

National Industry Excellence Awards 2023 was held at the Nelum Pokuna Theatre in Colombo. President Wickremesinghe stressed the importance of leadership built on honesty and transparency with the people.

President Ranil Wickremesinghe went on to announce his intention to propose loan concessions in the upcoming budget, specifically aimed at supporting small and medium-scale industrialists, with the aim of bolstering Sri Lanka’s export-oriented manufacturing sector.

The awards ceremony was held to recognize and honour 300 successful entrepreneurs across various categories, including platinum, gold, silver, and bronze awards, from a pool of over 4,000 industrial entrepreneurs who had competed in 21 major industrial sectors and 61 sub-industrial sectors.

President Wickremesinghe also addressed the challenges faced by industries in 2022, citing issues such as power shortages and difficulties in obtaining bank loans that led to the closure of many businesses. Despite these challenges, he noted the resilience of numerous individuals who managed to revive their industries and achieve success, particularly in the small and medium-scale sector.

The President stressed the importance of addressing ongoing concerns related to bank loans and market access, with a focus on supporting small and medium-scale industries in the upcoming budget.

President Wickremesinghe revealed ongoing discussions with international financial institutions, including the International Monetary Fund (IMF), and creditors to devise comprehensive strategies for revitalizing the nation’s economy.

The President emphasized the significance of consistently increasing income to meet loan repayment commitments and to gain the trust of private and multilateral creditors. He pointed out that a substantial portion of the next year’s budget would be allocated to debt repayment and interest payments, underscoring the paramount importance of safeguarding the country’s currency and fulfilling loan obligations.

President Wickremesinghe also explained the necessity of the decision to raise the VAT to 18 percent, aligning Sri Lanka’s practices with countries like India and Pakistan. He acknowledged that such decisions, while difficult, are essential for the country’s well-being, even if they attract public criticism.

In closing, the President reaffirmed his commitment to rebuilding the nation without reverting to dependency on external support, emphasizing that the path may be challenging, but he is confident that positive results will be achieved in the next two to three years through negotiations with international financial institutions, including the World Bank.