Sri Lanka central bank created high inflation and reduced wealth: economist

Jan 16, 2010 (LBO) – Sri Lanka’s central bank has created average inflation of 11.0 percent and must take the blame for impoverishing the people, a senior monetary economist and former central banker has said. After Sri Lanka got independence from Britain, the country had registered growth slightly over that of India, but had lagged the world.

Achievement

“Another past achievement of Sri Lanka during the whole post independent history is that we have had high inflation,” retired deputy central bank governor W A Wijewardene told a forum in Colombo.

“The average prices of consumer products which we consume on a day-to-day basis, have been rising at an average rate of 11.00 percent

Wijewardene was addressing members of the Rotary Club of Colombo Central Wednesday. At the time he retired last year Wijewardene was the deputy governor in charge of monetary policy.

“Coming from the Central Bank of Sri Lanka specifically we have to take the blame for reducing your real wealth,” Wijewardene said.

“Because the amount of money you have in your pocket, year after year, we have reduced its value by 11.0 percent.

“This means, if somebody had 100 rupees in 1950, its value would b