“Unleashing potential in informal sector vital for growth targets” | Daily News

“Unleashing potential in informal sector vital for growth targets”

Sri Lanka’s biggest inefficiency is the distinction between formal and informal sector, World Bank Chief Economist for South Asia Hans Timmer said.

Noting that it’s not only imperative to focus on big companies in the formal sector that in the past responsible for growth Timmer said, ”it is important to focus on informal sector, quite large in size in Sri Lanka to unleash the new potential that it has.Because if you don’t unleash that potential in particular by giving access to credit in the informal sector thereby creating opportunities to boost productivity,Sri Lanka will not achieve its expected growth targets.”

According to him, Sri Lanka is only using a small part of its potential. And workers or firms in particular in the formal sector are very much protected. As a result of that there are many outsiders.Addressing a seminar held virtually and organized by Centre for Banking Studies –Central Bank of Sri Lanka under the theme, ‘Impact of the Pandemic on South Asian Economies and How Digitization and Services Led Growth Can Help Sri Lanka to Beyond’, he said services not only produce jobs but increasingly produce export growth. With digital technologies or platforms services are actually tradable such as in healthcare and education.

“Services are directly tradable themselves and service sector moreover plays a much more significant role within other sectors in the export industry. It is important to have right competition policies in place as a result everybody will have access to these platforms at the same time.

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