Perceived Economic Opportunity PEO: November & December, 2017

This brief report of the Perceived Economic Opportunity (PEO) presents the analysis of a random survey carried out using a random sample of 400 men and women covering all districts in Sri Lanka on their expectations of economic prospects in the ensuing twelve months.

STATUS OF JOB PROSPECTS OR BUSINESS PERFORMANCE

Analysis of the perceived economic opportunities in the months of November and December 2017 indicate that the expectations in terms of job prospects of people or developing the status of their business in the ensuing 12 months has shown a continues growth. The same expectation was decelerated in the month of October.

The external sector performance in November 2017 was supported by continued inflows to the financial account of the Balance of Payments (BOP) mainly with higher foreign inflows to the government securities market, and marginally improved earnings from tourism. The BOP recorded an overall surplus of around US dollars 2.0 billion by end November 2017. Gross official reserves also increased to US dollars 7.3 billion (equivalent to 4.2 months of imports) by end November 2017 from US dollars 6.0 billion recorded at end 2016.

The external sector performance continued to improve in the month of December 2017, mainly with higher inflows to the Financial Account of the BOP. Continued inflows by way of tourist earnings and workers’ remittances, contributed in curtailing the expanded trade deficit to a certain extent while improvement in short-term and long-term capital inflows continued during the month. The gross official reserves of the country stood at US dollars 8.0 billion as at end 2017.

The below graph shows the change of expectations in terms of job prospects of people, or development of the status of their business, in the ensuing 12 months.

Refer the graph 01 below;

These reasons are likely to have had an impact on the expectations of job prospects and the business activities of the people in the months of November and December 2017.

ABILITY TO SAVE

According to the analysis in the months of November and December 2017, the expectation among the people to save a little more from their personal earnings in the ensuing 12 months has increased. The same expectation showed a decrease in the month of October 2017. Reduction of inflation in the months of November and December may have impacted the saving ability of the people. The inflation stood at 7.3 per cent in the month December 2017 compared to 8.4 per cent in the month of November and 8.8 per cent in the month of October.

Please Refer the Graph 02;

EXPECTATION FOR REDUCTION OF CORRUPTION

The expectation for reduction of corruption in the country showed a significant positive trend in the month of October 2017 and further expanded in the month of November. However, the same expectation slowed down in the month of December 2017.

Please Refer the Graph 03;

PEO; Perceived Economic Opportunity is developed and surveyed by the Foundation for Economic Freedom in Sri Lanka. PepperCube Consultants carry out field research covering the entire country.

The Perceived Economic Opportunity was developed and is measured by the Foundation for Economic Freedom in Sri Lanka (FEF) in partnership with Friedrich Naumann Stiftung Fur Die Freiheit.