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Proper fiscal and economic policies:
Average inflation projected around six percent in 2009 - CB
Governor
Hiran H. Senewiratne
The average inflation projected for this year will be around six
percent due to the Government’s proper fiscal and economic policies,
said the Governor of the Central Bank Ajith Nivard Cabraal.
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Ajith
Nivard Cabraal |
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Technical evaluations under way
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| Central Bank Governor Ajith Nivard Cabraal said that the Government
has almost completed negotiations with the International Monetary Board
(IMF) to obtain the US $ 1.9 billion loan. The IMF is now going through
the normal technical evaluations to finalize it. |
“Despite all odds, the Central Bank was able to bring down the
inflation level to a greater extent and hope to bring it down to a
manageable level in the coming years,” Cabraal told the 27th LBR-LBO
Chief Executive Officers’ Forum on Tuesday.
He said that the current global economic crisis or turmoil is beyond
our control and the International Monetary Fund (IMF) is now fighting
against making predictions on this issue.
However, the Central Bank is optimistic to register a six percent
plus growth rate and to bring down and manage the inflation level to a
single digit despite all these issues, he said.
Sri Lanka recorded 12 percent inflation in the past thirty years and
the current trend is that Sri Lanka is moving towards low inflation
countries in the region, the inflation rate now being 2.9 percent,
Cabraal said.
The reason for the inflation level to come down in the country, is
that the CB is dealing with several monetary policies and instruments to
arrest the high inflation by relaxing the monetary and fiscal policies,
he said.
He said that our index that measures the inflation rate is 50 years
old and it does not represent most items in the consumption basket. The
Central Bank Governor also said that Sri Lanka recorded a six percent
growth for four consecutive years and is now anticipating funds from the
Tamil Diaspora for the development of the Northern and Eastern
provinces.
He said since the liberation of the Eastern Province funds to the
tune of Rs 1.4 billion have been committed for development activities
and once the North is being liberated further funds will come into the
country for reconstruction and rehabilitation activities, he said.
With the dawn of peace Sri Lanka is heading towards a new era and the
proposed development projects would be completed on schedule to fast
track growth and we could stand as a developed nation, he said. |
