Govt. keen to support private sector: Cabraal

•  Admits growth may be slower but insists that all assistance will be given for investment

Despite a growth downgrade in 2012, Central Bank Governor Ajith Nivard Cabraal insists that the Government is focused on encouraging private sector investment and will provide maximum assistance.

Cabraal made these points as the Guest Speaker at the American Chamber of Commerce (AmCham) luncheon meeting held on the topic ‘The Future Trends of the Sri Lankan Economy and what it has to offer the Private Sector’.

The Governor said that Sri Lanka had to steer through some very turbulent times but that it had been successful in a “making a smooth landing without any damages”.

Answering questions, the Governor indicated that the Government was very keen in the private sector participation and that whatever development already carried out by the Government would have links to provide a great potential to the private sector.

He insisted that the country had seen strong growth and mid-single digit inflation, with foreign reserves at a comfortable level and a steady banking and finance sector with Sovereign Credit Ratings, Doing Business Index and FDI all on the rise.

Govt. ...

 “The fiscal deficit had been brought down to a manageable level and it was projected that the per capita income would reach the US$ 3,000 mark by end of 2012, whereas it had taken  Sri Lanka 56 years to reach the US$ 1,000 mark,” he said.

He further stated that Sri Lanka’s growth rate that has stood at 8% for the past two years may be consciously cut to 7.2% this year. Unemployment had reached its lowest levels in 2011. The continuous upgrading of the country-wide infrastructure includes road development, port development, power projects, tourism based projects and airports.

Cabraal insisted that this environment would greatly benefit the private sector in Sri Lanka to expand and develop their activities. Special focus has been given by the Government for poverty reduction and projects such as ‘Gama Neguma,’ ‘Divi Neguma,’ ‘Maga Neguma,’ and ‘Kirigammana’ among others are being implemented in 144 villages at Rs. 1 million each. The total cost of the present work in progress is in the region of US$ 7 billion.

“Risk indicators of Sri Lankan public debt have improved, while global risk has been rising while foreign reserves accumulation has been substantial in the past few years and the views of IMF, rating agencies and international banks have been encouraging.”