'Sri Lanka immensely benefitted from Bangladesh’s support'

Sri Lanka has immensely benefited from Saarc countries, particularly Bangladesh and India, from a macroeconomic perspective in recent times, the central bank governor of the Island nation said yesterday.

P Nandalal Weerasinghe made the remark while addressing the inaugural session of the 14th South Asia Economic Summit, a two-day event, hosted by the Centre for Policy Dialogue at the Sheraton Dhaka hotel.

"The assistance that was extended in the wake of the crisis provided immense relief in the midst of the socioeconomic quagmire that Sri Lanka was in," he said.

"This type of financial cooperation among us can not only be a short-term buffer but it can also be of a more long-term nature in the form of investment flows towards infrastructure gaps and even building of overall productive capacities."

In September, Sri Lanka paid $50 million to Bangladesh, the final instalment of a $200 million loan taken under a currency swap agreement two years ago.

Sri Lanka paid back its loan as its embattled economy is staging a recovery from its worst economic crisis just a year ago.

Weerasinghe said amid the global economic slowdown, the Saarc bloc will need to go back to the drawing board and rapidly work out effective yet pragmatic strategies that can help our vulnerable region to weather this storm.

"Regionalism will be essential to sustain South Asia's dynamism. South Asia is a subregion that is yet to fully exploit its intra-regional potential."