Increased exports to spur economic growth

by Elmo Leonard

Sri Lanka's economic growth is projected at 7.5 percent for the current year, exceeding the 7.2 percent growth in 2006.

The higher economic growth rate will come from increased exports, Treasury Secretary, Dr. P. B. Jayasundera said.

Earlier, Minister of Finance and Government Revenue, Ranjith Siyambalapitiya said that foreign remittances are expected to grow from Rs. 2.5 billion in 2006 to Rs. 2.7 billion this year. Overseas recruitment agencies have been asked to find higher income jobs for the Lankan expatriate workers.

Dr. Jayasundera said that the recent Sri Lanka Development Forum in Galle brought in $4.5 billion in foreign assistance. The forum was informed that the economy had during the year past, faced up to terrorism the high price of oil and an adverse publicity of human rights, levelled at the state, overseas. Contrary to development fora of the past, held in Paris and Tokyo for instance, preconditions or regulations to be followed for funding, were not enforced, Dr. Jayasundera said.

At the other Kandy Development Forum, where the World Bank, ADB, Japan, UK, USA and all donors and international bodies were present, the framework for ten years of the Mahinda Chinthana was spelled out, Dr. Jayasundera said. And, all attempts will be made to follow it.

For the next three to four years top priority will be given to national and rural development. The program will get off the ground, ports, airport, express- ways, highways, new townships and water supply systems will be built, Dr. Jayasundera said.

In another project, 4,000 villages will be identified and roads, electricity, and houses built, the Treasury Secretary said.

Japan had provided the largest amount of assistance for a year, being Japanese Yen 39.2 billion (Rs. 40 million) and that money will also be used to build the outer circular road, beginning in Kadawata on the outskirts of Colombo. Another Japanese Yen 4 billion will be made use of for rural development in the north and east, and southern poverty stricken areas.

With the visit of President Mahinda Rajapaksa to China, agreements for funding the development of the Hambantota port and the Chinese constructor were signed.

The development of the Colombo South port has received the funding of Tokyo and work is expected to begin shortly. Towards the end of this year the World Bank funded coal plant at Norchcholai will get under way. Irrigation schemes will begin soon and end in four to five years, Dr Jayasundera said .

The Department of Inland Revenue had in 2006 collected Rs. 100 billion more than it had done in 2005. This year, it is expected to collect Rs. 615 to 625 billion which will amount to 17.4 percent of GDP.

Two billion rupees had been set apart to purchase paddy during the forthcoming Maha season in the regions of Anuradhapura and Kurunegala by the Sri Lanka Agricultural Products Marketing Authority. This year, an additional 100,000 tonnes of rice will be purchased. The rationale is to see that the benefits from rice cultivation flows down to the rice farmer.

Tourism is to be revived from September this year and export earnings in the next two years is expected to reach $1 billion. The proposals for the development of tourism have been put out, Dr. Jayasundera said.

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