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by Elmo Leonard

Sri Lanka was getting ready for a new era of development, secretary, Ministry of Finance, Dr P.B. Jayasundera said. The 6 percent economic growth for 2005, in spite of the tsunami which took away 0.5 percent of GDP and the oil shocks which continue to date, was proof of a resilient economy and impending development, Dr Jayasundera said.

The 2006 budget showed an improvement in the balance of payment; growth in apparel export sector; increase in the country's foreign reserves; increased remittances from overseas workers among other positives, Dr Jayasundera said at a presentation on the Mahinda Chinthana and the private sector' organised by the Federation of Chambers of Commerce and Industry of Sri Lanka.

Inflation which was running at 16 percent, at end-March was down to 7 percent, Dr Jayasundera said. The public enterprises were performing well. At its summit were the three state banks, Bank of Ceylon, People's Bank and National Development Bank; all performing better than before, Dr Jayasundera said.

The private sector had done extremely well during the past year and shows signs of continuing into this year. Tourism, apparel, plantations and the small and medium sector, among other sectors, were performing well, in spite of adverse conditions, thus stabilising the macro economy. The Mahinda Chinthana is a home grown economic strategy. By June, the overall policy of economic development for the next 10 years, would be put into effect, Dr Jayasundera said.

The Mahinda Chinthana would enable the private sector to add to the economy, making it grow from 5.5 percent for the past decade, to 8 percent this year. The private sector provided 25 of the GDP during the past year and is expected to contribute 30 percent during the current year. The rural sector, and the small and medium sector was also expected to add more to the GDP. The BOI grown private sector was also doing better.

The private sector would be allowed to add up to 50 megawatts power from 10 megawatts in the past and there are four such plants for the private sector to bid, Dr Jayasundera said. For development in the country, the infrastructure was hopelessly inadequate. Constructing highways, connecting Trincomalee, Puttalam and Hambantota would begin soon.

The Colombo Matara railway track will be extended with Indian aid. The Colombo port will be extended. The Galle and Hambantota ports will be built to meet the demand of exports, and incoming traffic needed during the next 10 years. The second runway at the Katunayake airport will be built and a new airport will be constructed in Hambantota with government funds, Dr Jayasundera said.

There will be large scale urban development, also rural roads and irrigation will be improved. Only viable projects will be undertaken. Borrowing will not take place, just because donors and lenders are willing to lend.

The word Ceylon tea was going out of vogue and being replaced by branded teas, made in Sri Lanka, foremost among such brands is the Dilmah brand. Dankotuwa Porcelain is another established brand. Likewise, furniture will no more be known as furniture, but by brands, Damro furniture, being an example.

Even chicken will be branded, Maxie's chicken is one such brand, Dr Jayasundera said. Banking will be taken to the rural areas, at reasonable rates. Some of the sectors were growing well, telecom being another sector and for all such development activity, the private sector will be called in to play a big role, Dr Jayasundera said.

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