Nandalal Weerasinghe Sri Lanka Government Nandalal Weerasinghe Sri Lanka

Construction sector cannot depend on govt-funded projects – CBSL Governor

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COLOMBO (News 1st) – Central Bank Governor Dr. Nandalal Weerasinghe told a forum organized by the Ceylon Institute of Builders that the country's construction sector boomed due to government-funded projects, but the same model will not apply in the future."After the end of the war mega-infrastructure development projects took place, largely are government-funded projects, either borrowed-money or taxpayers money," he said, adding that when the Sri Lankan government was finding it difficult to finance a comfort letter was given to the private commercial banks, where funding can be obtained from the banks for the government project and the money will be paid later."That was a trap," revealed the Central Bank Governor.He said that the country's construction sector developed to its present state was mainly due to government-funded projects, and going forward the sector cannot rely on government-sponsored projects."If we are going forward with the same model, we will see another round of restructuring, and debt sustainability issues.

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