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| Sunday, 9 May 2004 |
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New economic policy statement this month by ELMO LEONARD The new Finance Ministry would not want to disturb the current budget, but work within its framework, Central Bank (CB) Governor, A S Jayawardena told the media last week. The CB and the Finance Ministry had, had many rounds of talks in the past weeks. This month, the new government would prepare an economic policy statement in association with the CB, Jayawardena told the media, while presenting the CB's 54th annual report for 2003. Conforming to the economic performance of 2003, up to end-March, inflation continued to fall in keeping with the rate of inflation for 2003, CB's Director of Economic research, Dr. A. G. Karunasena said. According to the CB report, inflation declined at a faster pace than expected at 3 percent and 6 percent, conforming to two yardsticks used for measuring inflation, applied by the CB. Year 2003 was one of exceptional economic performance, and it should be used as a measure for working out future economic indices, Dr. Karunasena said. Jayawardena, spelled out the growth of Sri Lanka's Gross Domestic Product (GDP) for 2003, at 5.9 percent, compared to 4 percent for 2002. Answering questions, the CB Governor said that to pay for the increased fertiliser subsidy amounting to Rs 500 million and an anticipated Rs 1 billion per annum subsequently, the government intended to borrow from the Youth Care Programme funds, hitherto unutilized. With it, there would be an increase in the agricultural sector. The same funds would be used to employ 15,000 youth with a two-year training before being absorbed into various sectors under a programme yet to be evolved, Jayawardena said. As a means of meeting increased expenditure, the government had planned to augment revenue by collecting taxes due, effectively and by reducing waste. It is also foreseen that petroleum prices would rise in the coming future, the CB governor said. The CB, would urge the government to keep inflation down, or else prices would go up and the poor people would be hit. Jayawardena expected good performance from the government, even a reduction in interest rates, and increased economic growth backed by the prevailing strong economy. |
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