|
|
|
 |
 |
 |
| Thursday, 1 January 2004 |
 |
|
 |
News | |
| News Business Features Editorial Security Politics World Letters Sports Obituaries
|
by Chamitha Kuruppu The Gross Domestic Product (GDP) in the third quarter of 2003 grew by 5.6 per cent. This was the fifth consecutive quarter in which the growth exceeded 5.5 per cent, the Central Bank of Sri Lanka (CBSL) said yesterday. The third quarter growth performance confirms that that the economy has continued to maintain the growth momentum seen since the second half of 2002 supported by a conductive macro-economic environment, the bank said. Deputy Governor W.A. Wijerwardena said that to achieve the projected GDP growth of six per cent for 2004, it is vital to continue the peace process and maintain political stability. "Growth in the first three quarters has been consistent with projected annual GDP growth of 5.5 per cent for 2003. The main factors for the recovery were the continuation of the ceasefire, improved macro-economic environment, greater fiscal discipline, declining interest rates, falling inflation and improving business and investor confidence, he told a media briefing in Colombo yesterday. The challenge is to achieve the medium term growth target of over six per cent, the bank release said adding that without such a higher expansion in economic activities, it will be difficult to improve education and employment opportunities, income generation, living conditions and the quality of life of the average citizen on a sustainable basis. Future expansion in investment will ultimately depend on numerous factors such as political stability, securing a lasting peace to the civil conflict, further improvements in macro-economic management, including even greater fiscal discipline, acceleration of structural reforms, reducing economic policy uncertainties and effective utilisation of external assistance to improve infrastructure facilities all leading to greater investor confidence in the future potential of the economy. In the sectoral analysis, services sector recorded the highest growth of 8.3 per cent. The industry sector did not perform as expected and recorded only a growth of 2.8 per cent. The agriculture sector recorded a growth of 2.1 per cent under favourable weather conditions which helped expand cultivation activity. The services sector grew by 8.3 per cent and contributed 79 per cent of the overall growth in GDP. Of the services sector, the banking, insurance and real estate sector recorded the highest growth of 13 per cent. The growth in the banking sub-sector by 18.7 per cent was mainly responsible for the high growth. Transport, storage and communication sector expanded by 12.1 per cent. The telecommunication sub sector grew by 29 per cent and port services by 14.1 per cent. Wholesale and retail trade sector grew by 6.5 per cent while imports rose by 12.9 per cent with high demand for consumer and investment goods. Exports fell by four per cent. Tourist arrivals rose by 17 per cent. The Industry sector grew by 2.8 per cent and the declaration in the manufacturing sector, the largest in the industry category was responsible for this comparatively low growth. Electricity, water and gas sector expanded by 3.4 per cent. The agriculture sector increased by 2.1 per cent while the Yala production rose by 7.9 per cent with a record harvest of 1.17 million MT. The tea production increased by 5.6 per cent, coconut production up by 7.7 per cent and minor export crops up by 10.2 per cent. However, rubber production decreased by 5.8 per cent and vegetable were down by 1.6 per cent owing to the drop in production of low country vegetables. Fish production was down by six per cent, with declines in the marine and inland fisheries sectors. Wijewardena said slow implementation of the proposed structural reforms, implementation delays in infrastructure projects especially in the energy sector, slow rise in investor confidence, slower recovery in the world economy than expected, political instability that affects daily economic activities and no progress in the peace process would be downside risks of longer term growth prospects. |
|
News | Business | Features
| Editorial | Security
Produced by Lake House |
