📈 SL Economy: Six Quarters of Growth Amidst VAT & Poverty Concerns

• Macro Recovery: The economy has seen six consecutive quarters of growth, averaging five percent, reflecting one of the most outstanding global recoveries since 2022. Macroeconomic policy continues to be shaped by the IMF's $3 Bn Extended Fund Facility (EFF). • Market & Credit: Colombo Stock Exchange-listed companies report quarter-on-quarter increases in turnover and profitability. Credit growth exceeded one trillion rupees (Rs. 1 Tn) in the first three quarters, driven largely by ongoing vehicle imports. • Govt. Positives: Official reports highlight a strong year for industrial/entrepreneurship, citing a 9.7% sectoral growth and the creation of 15,000 new entrepreneurs, alongside substantial debt relief for SMEs and 15 key structural reforms. • MSME Challenge: Future concerns loom for MSMEs (micro, small and medium-sized enterprises). A proposed VAT threshold reduction from Rs. 60 million to Rs. 36 million, effective April 2026, is expected to increase the administrative burden on the smallest businesses and compel them to raise prices. • Social Context: Despite the recovery, over a quarter of the citizenry are still finding it difficult to make ends meet and continue to live below the poverty line.