Budget to consolidate fiscal position - CB Governor
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Ajith Nivard Cabraal
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Budget 2008 will consolidate the fiscal position, continue major
infrastructure projects and provide relief to low-income groups and
local entrepreneurs, said Governor of the Central Bank Ajith Nivard
Cabraal at the post Budget press conference organised by KPMG Ford Rhode
Thornton and Company.
Speaking on the theme "Sri Lanka economy: Perception/claims vs
reality", he said that the Sri Lankan economy is growing reasonably well
despite the tsunami, drought and other external pressures such as the
oil shock. It has grown at an average of 6% during the past three years.
The economy is due to grow at 6.7% this year.
The budget would help build a regional developed economy which would
help build a sustainable economy in the long term. The country was able
to register growth in every sector and most importantly the services
sector has grown the most. This would help the private sector become
more vibrant and engage in business.
The Governor said that Foreign Direct Investments (FDI) have
increased by 8% while domestic investments increased by 41% during the
past five years and we are expecting it to grow by 33% by next year. The
private sector accounted for 79% of the investments. Forex reserves will
increase to US$ 3 bln.
He said that the rupee has depreciated by only 3.9% this year while
on average the rupee depreciated by 5.9% during 2001-2004. In 2006 the
depreciation was 5.2%. There will be a massive infrastructure
development program in every province during the next 3-4 years and we
will revitalise local entrepreneurs and the low income groups to ensure
that the economic growth is shared among all provinces, said Cabraal.
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