January 2, 2013, 8:17 pm
Opposition law maker and UNP Economic Spokesman Dr. Harsha De Silva yesterday questioned the Central Bank’s per capita income estimates but commended the bank’s professional staff for their hard work.
"Unlike last year, the 2013 Monetary Policy Road Map seems more realistic indicating it is possible to learn from past mistakes. The hard work of the professional staff of the Central Bank of Sri Lanka (CBSL) must be commended for developing such a comprehensive presentationand going in to great technical detail. That is what is expected," Dr. De Silva said in a statement.
"While appreciating the technical details, the political slogan of the Governor appears to be of achieving USD 4,000 per capita income by 2016. It is quite possible that this nominal target;for some reason revised downwards from the Mahinda Chintana target of USD 4,470, can be easily met with the inflation target set in the roadmap itself, given a favourable exchange rate. The presentation attempts to show that the per capita income increased continuously over the recent past as shown in the only slide that is curiously not drawn to scale.
"Something I searched in the detailed presentation but couldn’t find was an explanation that the only reason the per capita income increased from USD 2,836 in 2011 to USD 2,922 in 2012 is because the population figure was revised downwards from 20.87 million in 2011 to 20.28 million in 2012. In fact, if assuming the normal growth rate of the population on the previously estimated population figure 2012 per capita income would have been less than that of 2011 due to the drastic depreciation of the exchange rate as a result of the now infamous politically driven policy of the CBSL that had to be abandoned in early 2012.
"While it is not wrong not to reveal the reason for what seems like a smooth growth path it is better to have been transparent by making a note as to the significant change in the assumptions. Such action will help build confidence in the CBSL statements as to being, not only technically, but morally and ethically above board," Dr. De Silva said.