Economic data crisis: JVP demands answers

Friday, 31 January 2014 00:43 -     - {{hitsCtrl.values.hits}}

  • JVP condemns witch-hunt against Census Director
  • Central Bank, Finance Ministry explanations fall short, says Marxist party
  • Calls for expert inquiry into allegation of economic data distortion
  • Charges Govt. needs to show high growth rates to keep borrowing, woo investors
  • Party to call for adjournment debate on the issue
The Marxist Janatha Vimukthi Peramuna has demanded answers from the Government over the economic data scandal that erupted in December last year and said the regime was being forced to inflate economic growth figures in order to keep borrowing from foreign and commercial lenders. Addressing a press briefing yesterday, JVP MP Anura Kumara Dissanayake roundly condemned the ongoing witch-hunt against Director of the National Accounts Division of the Census and Statistics Department H.S. Wanasinghe who issued a statement narrating how he was ordered to increase GDP growth rate for the first quarter of 2013 to 6.0% when his calculation showed it was only 5.4%. Leaked communications from the Department showed Wanasinghe had demanded an explanation from a subordinate about this distortion, which was later revealed in Parliament by Dissanayake. “This Director is now being transferred from pillar to post. They are threatening to sack him. His vehicle has been withdrawn – this is shameful behaviour by the Government to cover up a scandal,” Dissanayake charged. The JVP MP said that the Government, which had decided to begin providing answers to his queries raised on 20 December more than one month later, had simply failed to address the issue of distorted economic data, as exposed by the internal communication and Wanasinghe’s statement. “The Central Bank officials and Census Department officials are trying to make a case, but none of them are reasonably answering this allegation that economic growth figures were inflated for the first quarter of 2013,” he told journalists. Dissanayake called for a special panel of experts to investigate the issue and said the JVP would request an adjournment debate about the scandal. The Government had to artificially inflate growth figures in order to woo investors and ensure it could keep borrowing to the keep the state afloat, the JVP MP charged. “The Government cannot collect enough revenue within the period of a single year to meet its debt commitments for that year. So it is forced to keep borrowing to function. Robust growth rates ensure that lenders will still loan to this Government,” Dissanayake explained. He said the people of Sri Lanka had long suspected that the economic data coming from the Government was inaccurate, because the alleged economic renaissance was making no difference in their own wallets. “Day by day, in fact, we had less and less money. Now it has been proved that this is in fact the case and that the data is wrong.” Dissanayake explained that the country’s economy rests on the two key economic data indicators of economic growth rate and debt to GDP ratio. “Manipulation of the growth rate ensures that the GDP calculation and the per capita income calculation also get distorted,” he said. “This economy is a bubble and it will burst on the citizens. It will burst not only on the Rajapaksa family but on the entire country. Therefore, the Government needs to act more responsibly,” he charged.