Jan 04, Colombo: Sri Lanka in the medium term expects an 8-9 percent economic growth over the next few years with all sectors contributing to the growth, according to the Central Bank.The Governor of Central Bank Ajith Nivard Cabraal presenting the monetary authority's future plans for 2011 pointed out that the challenge would be to maintain inflation at around mid-single digit levels in the short and medium term and the Bank will continue to monitor monetary and economic developments closely and respond appropriately.
In his presentation of "Road Map Monetary and Financial Sector Policies for 2011 and Beyond" Cabraal predicted an 8.5% GDP growth for 2011 rising to 9.5% by 2013 while the GDP deflator declining from a 7.0% in 2010 to a 5% by 2013.
Looking ahead the Central Bank says it will further develop and improve the financial sector with emphasis on safety and stability.
The Bank will also implement an effective and robust supervisory mechanism with risk management given top priority.
Under the measures to be taken by the Central Bank, guidelines are to be issued to banks on Integrated Risk Management to ensure availability of adequate capital within banks and other financial institutions to meet unforeseen risks. The measures will require all Registered Finance Companies (RFCs) to list on the CSE by June 2011.
The Central Bank expects to increase collaboration with foreign financial institutions in 2011.
"Since there is an increasing presence of international banks in Sri Lanka and local bank branches outside Sri Lanka, Memorandum of Understanding (MOU) with home regulators of foreign banks and host regulators of local banks in the Asian region, will be developed by end 2012," the Road Map says.
Among other measures to be developed, the Bank also hopes to develop the corporate bond market further as the measure would create a deeper, increasingly integrated, and competitive financial market.
The monetary authority hopes to further strengthen the macroeconomic factors within the Bank's control and commit to improve the economic and financial environment, the Road Map concluded.
Colombopage
