Hard times not over

The government should make an all-out effort to increase domestic and foreign investment.

The macroeconomic situation has improved as of the first half of the fiscal year 2022-23, but the economy is not out of the woods yet as the underlying vulnerabilities remain unaddressed. Due to interventions by the government and the central bank, economic activities have recovered from the pandemic slump, bank interest volatility is stabilising and external sector balance is gradually improving. However, the fiscal situation remains dire with lower than anticipated revenue mobilisation against high expenditure commitments and the rising cost of borrowing. The next two quarters will be crucial in terms of judicious fiscal and macroeconomic management and policy coherence.