Weeks ahead of the Parliamentary polls, Sri Lanka has lowered the economic growth rate of 2014 to 4.5 per cent from the earlier 7.4 per cent.
This follows the change in the base year and the methodology of calculation, according to a release issued by the Department of Census and Statistics (DCS). Hitherto, the base year was 2002. From now onwards, it is 2010.
Keeping in mind 2010 as the base year, the value of Gross Domestic Product (GDP) at constant price was about Rs. 64,13,668 million (Sri Lankan currency) that year. In 2013, it went up to Rs. 78,46,202 million and last year, 81,95,979 million. The pace of growth, which was 8.4 per cent in 2011 and 9.1 per cent in 2012, slowed down subsequently with the rate being 3.4 per cent in 2013 and 4.5 per cent the next year.
The reduction assumes significance politically in the wake of regime change that took place in January this year. The year in question pertained to the period when Mahinda Rajapaksa was President.
However, the Department has asserted that no comparison could be made between the data compiled under the earlier base year (2002) and those of the present base year (2010) due to differences of coverage, estimation method and classifications used in the process.
The United Nation’s manual, “System of National Accounts,” revised in 2008, has been used to the extent possible. A senior official in the DCS also says the revision in the base year should have been done once in five years. But, this target could not be met due to a number of issues including administrative matters. Hereafter, the attempt will be made to stick to the deadline.
Under the latest system, the activities under the informal sector have also been included, Deputy Minister of Policy Planning and Economic Affairs, Harsha de Silva, has stated in his Facebook post.
