Sept 17 2008 (LBO) – Sri Lanka’s economists are debating inflation, competitiveness and growth this Friday and Saturday at a time when inflation has hit a historic record in the island and subsequent tight monetary policy has strengthened the rupee.
“The extent of such gap in aggregate supply will depend on whether the economy is overstretched beyond its potential growth capacity.”
SLEA says inflation is also due to internal factors and one sessions would be devoted to the impact of external factors on inflation such as the increase in global food and oil prices.
The Sri Lanka Economic Association (SLEA) is holding its annual sessions on September 19, and 20.
“We cannot take inflation for granted not only because of its adverse effects on export competitiveness unless offset by depreciation of the Rupee which in turn adds to inflation as well,” the SLEA said in a statement.
“Experience in other countries with high inflation shows that inflation beyond a point develops its own momentum and gets out of control.
“The technical sessions will discuss the impact of high inflation on increasing poverty for the poor get pushed down to lower levels of real income,” the SLEA said.
Among the participants at the parley would