Economy on track to realise growth potential
With the recovery in the global, the economy and the increasing
domestic demand after the end of the war and liberation of the North,
the Sri Lankan economy will return to its normal growth potential said
the Chief Economist of the Central Bank Dr. Nandalal Weerasinghe.
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Dr. Nandalal
Weerasinghe |
Dr. Weerasinghe was addressing the annual conference of the
Association of Accounting Technicians of Sri Lanka (AATSL) in Colombo
last week.
He said that the global economy is showing signs of recovery and the
domestic economic indicators too are positive. The reserve position of
the country is being improved from the worst situation in March this
year. Balance of payment position is improving and the financial markets
too are on a recovery. Dr.Weerasinghe said that with these positive
developments the recovery in the real sector of the economy will
commence within next two or three months.
He said that the entrance into open market economy and liberalisation
of the current account prior to other South Asian countries provided Sri
Lanka with a unique environment of challenges to which it had to adopt
very quickly. The financial system of the country was sophisticated with
the introduction of IT as well as prudent regulations. The regulators
introduced several prudential measures and Sri Lanka is a pioneer in
introducing Basel-I and Basel-II Accords. As a result our financial
system became robust and resilient to external shocks. We introduced
further measures to ensure that financial institutions do not increase
their exposure to one sector, thus reducing the systemic risks, Dr.
Weerasinghe said.
He said that Sri Lanka felt less primary impacts of the global
financial crisis. However, to mitigate any adverse impact on the
domestic financial system temporary measures were adopted from October
2008 to April 2009. However, as a result of the decrease in global
demand the real sector of the economy was affected, he said. GW
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