Security concerns, world oil prices challenge Lanka's eco growth

Colombo, June 30 (UNI) Sri Lanka's Governor designate for Central Bank Nivad Cabraal today said the country's security situation and the world oil prices ''are the two key challenges'' to the economic growth in the island nation but expressed optimism to overcome these challenges to achieve the intended growth rate for this year.

''Always increasing fuel prices in the world market and the negative impact felt in the economy because of the security situation in the country are the two key challenges we face. But development must take place notwithstanding challenges we face and we are ready to face those challenges,'' Mr Cabraal, who is assuming duties as the Governor of the Central Bank of Sri Lanka, told reporters here.

Setting the economic growth target rate for the year 2006, as 8 per cent of the GDP, Mr Cabraal said the Bank has registered favourable signals in all sectors of the economy during the first quarter of the year and is optimistic that the ''target is achievable''.

''Eight per cent growth rate is a tough target, but certainly achievable. Based on the indications we have received so far, we can be factually optimistic that we can achieve 8 per cent growth rate for this year,'' he said, adding the government has put on track various development projects such as the Noraichcholai coal power plant and Katunayake-Matara express high-way.

He also said the government remains optimistic that the post-tsunami housing construction project would be completed by the end of this year with the assistance of the donor community.

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