📈 Sri Lanka Needs to Look Beyond Financial Stability & Inflation, Experts Warn

At the SLEA-GCF economic forum, Central Bank of Sri Lanka (CBSL) and industry leaders highlighted that true financial resilience must move past traditional metrics like capital and liquidity to tackle permanent global and structural risks. • Policy & Regulatory Shifts CBSL warns that geopolitical tensions, climate risks, and cyber threats are now permanent features of the operating environment. The Central Bank of Sri Lanka Act No. 16 of 2023 has enhanced institutional independence and formally mandated financial stability alongside inflation control. Dynamic, forward-looking supervision via stress testing and scenario analysis is urged over historical, backward-looking indicators. • Credit & Real Economy Priorities Economists warn against excessive risk aversion post-crisis; financial institutions must actively deploy credit to productive sectors to avoid stalling rural and semi-urban recovery. Rapid credit growth must be monitored carefully, as it can temporarily mask underlying asset quality and non-performing loan (NPL) ratios. • Financial Inclusion & Climate Risks Panelists highlighted a critical gap: nearly 50% of Sri Lanka's economically active population still lacks access to formal finance. Greater collaboration is demanded between banks and non-bank financial institutions to mobilize climate finance, protect agricultural value chains, and expand inclusive credit.