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A lot of
domestic
factors,
the end
of war,
rehabilitation,
re-construction
and
improvement
from
agriculture
will
drive
growth
of Sri
Lanka's
economy,
said
HSBC
Singapore
economist
Prakriti
Sofat at
a
business
forum in
Colombo
Tuesday.
Inflation
in Sri
Lanka
was now
in low
single
digits.
Sofat
said the
low
inflation
will
increase
disposal
income
of the
people
allowing
the
domestic
economy
to grow.
Growth
in many
Asian
economies
had
started
to slow
by the
middle
of last
year due
to a
massive
"inflation
shock",
even
before
the
impact
from a
US
slowdown
became
widespread,
she
added.
"Economic
growth
in Asia
started
slowing
down in
the
middle
of last
year,"
she
said.
Sofat
said Sri
Lanka
has
spent
about
6.0
percent
on
infrastructure
despite
a
military
expenditure
being
about
4.0
percent
of gross
domestic
product
(GDP).
"When
political
devolution
happens
as the
international
community
sees it
happening,
FDI will
go up,"
she
said.
Sofat
said a
delayed
International
Monetary
Fund
loans
would
also
help
strengthen
the
country's
prospects.
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