Sustaining growth rate important - Prof. Srimal Abeyratne

Sri Lanka has the potential to go beyond an eight percent economic growth rate and sustain the momentum said Senior Lecturer, Department of Economics, University of Colombo, Prof. Sirimal Abeyratne addressing a public lecture in Colombo on Wednesday.

He said sustaining the growth rate is what is important and added that the country has the potential to achieve a 10 percent economic growth rate.China has achieved this feat and now India is following suit.

Prof. Sirimal Abeyratne

"Sustaining a higher economic growth rate is a daunting task. Nevertheless it could be achieved if the investment ratio could be enhanced to 40 percent of the GDP", Prof. Abeyratne said.

"The hub strategy is fine but the country's knowledge market is way behind many countries have made leaps in this sector.

The 92 percent literacy rate could be a myth when exposed to the outer world", he said.

Prof. Abeyratne said excessive dependence on the West for trade, tourism and investments could have its adverse effects on the country such as the setback from the financial crisis and the GSP plus benefits.

"The strategy of 'picking winners' for subsidies and incentives is not a sound mechanism to promote a vibrant business environment.

There has to be a level playing field and emerging sectors should be recognised", he said.

CEO, Lion Brewery, Suresh Shah who spoke on the 'Role of the Private Sector and Expectations' said the private sector should lobby for reforms and not favours.Taxes if reasonable and wisely used should be encouraged.

"Economic activities should be left in the hands of the private sector and the state should facilitate growth.The bureaucracy should be empowered to act quickly and fairly", he said.

"Investments in education, health and infrastructure are essential for economic growth", he said.

Executive Director, Institute of Policy Studies, Dr. Saman Kelegama said the country has to overcome challenges such as converting loss making institutions to be profitable, widening the tax base, enhancing revenue and addressing the cost of doing business to achieve economic targets.

"There is potential to increase revenue to the country to 20 percent of the GDP of the current 14 percent. Revenue in Malaysia is 21 percent of GDP", he said.

Executive Director, LIRNEasia, Dr. Rohan Samarajiva said of the five hub strategy knowledge should be developed to compete in the global business. Sri Lanka ranks 16 under Skills and Availability' according to world. AT Kearney BPO ranking -2009.Ports, aviation, commerce and finance, energy and knowledge have been recognised as hubs under the accelerated development program of the government. LF