Although the economic growth rate had slowed down to 4.4 percent in 2016 from 5 percent in 2014, the growth in terms of GDP has actually increased last year amounting to Rs.11,839 billion from Rs.1,0361 billion in 2014, UNP General Secretary and Public Enterprises Development Minister Kabir Hashim said yesterday.In this context it is not correct to say that the economy is failing, simply going by the economic growth rate.
Addressing a media briefing at Sirikotha yesterday, the Minister said a Professor from a leading University has commented in a newspaper article that the economy has slowed down in 2016 compared to 2014. This is a wrong interpretation.
According to the Central Bank report in 2016, the service sector has grown by 4.2 percent while the industrial sector has reported a growth of 6.7 percent. The Professor has commented that the industrial sector has shown a growth due to the construction sector boom in the country.
But, this is wrong. The construction sector’s contribution to the industrial sector is only 14.9 percent, the Minister stated.
“We accept there is a setback in the agricultural sector. But this is also due to a very long drought experienced recently. This has resulted in the decline of the economic growth rate as well. Price of tea, rubber and coconut were also affected due to a global fall in prices. But, we have been able to increase the price of tea leaves upto Rs.90 per kilo while the price of natural rubber latex was incresed upto Rs.350 per kilo.
Compared to our economic growth rate, there is a heavy decline in other countries. Economic growth rate in USA was 1.6 percent in 2016 while it was 2.4 percent in 2014. The economic growth rates in UK and South Korea were 3.1 percent and 3.3 percent respectively in 2014 while they have declined to 1.8 percent and 2.7 percent in 2016.
There is only 11 percent reduction in the overall economic activities from 2014 to 2016 in Sri Lanka. But In India, they experience a 52 percent decline during the same period. The world’ economic growth rate has also reduced from 3.4 percent in 2014 to 3.1 percent in 2016.
In rupee terms, there is no fall in per capita income. But, in dollar term there is a difference due to depreciation of rupee. During the former regime, the economic benefits were enjoyed only by the rich people and there was nothing for poor. At that time 20 percent of the rich people enjoyed the 50 percent of the country’s wealth while the poor got only 4 percent.
“According to the CB report, we have been able to create 120,000 new jobs last year. The unemployment problem between the youth aged 15 to 24 years arose due to the formation of Nil Balakaya during the last regime. The Nil balakaya used the youth for their political campaign without creating job opportunities for them.
Commenting on the Cabinet reshuffle, he said it is a normal turn of events under any government. It depends on the capabilities of any Minister. This is a joint decision taken by both the President and Prime Minister and another reshuffle can also take place shortly. If a Minister does not have any knowledge on the subjects assigned to him he or her should learn them. As an example former Minister Ronnie the Mel has a degree in a history. But he became one of the best Finance
Ministers of the country later under the former President J.R.Jayewardene . In the Mahinda Rajapaksa eara only three people controlled all the powerful ministries and about 70 percent of the budget was allocated to their Ministries. They even did not allow the skilled people to work. But, everybody has forgotten that past now,” he added.