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| Wednesday, 17 March 2004 |
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The Government has reduced the budget deficit which stood at Rs. 152.2 billion in 2001 to Rs. 141.2 billion by the end of 2003 by utilising a saving of Rs. 11 billion made on defence expenditure as well during the last two years, a press release issued by the Office of the Government Spokesman said yesterday. The release said the Government was able to effect this saving due to the peaceful environment in the country. As a result, the budget deficit which was 10.8 per cent of the GNP in 2001 reduced to 7.8 per cent of GNP by the end of 2003, the release added. Meanwhile during the last two years the Government has repaid Rs. 64.85 billion out of the total Rs. 66.3 billion loans obtained by the previous regime for defence and other expenditure on very high interest rates. This included Rs. 49 billion of the Rs. 50.5 billion obtained by the previous regime as Bank overdrafts with 18 per cent interest and unsettled import bills and another Rs. 15.85 billion obtained under Sri Lanka Development bonds, said the Office of the Government Spokesman. The release added that these repayments were made from two to eight per cent low interest loans obtained by the Government under its streamlined debt management scheme implemented during the last two years. The peaceful environment in the country during the last two years and the confidence placed by international and local financial actors in the Sri Lankan economy due to the Government's sound budget management and financial program has enabled the Government to obtains these low interest loans on easy payment terms, Central Bank sources have said. This has enabled the country to make a colossal saving on interest payment, Bank sources added. |
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