Mixed Signals

The Asian Development Bank revised growth targets downwards to 5 percent this year and 5.5 percent in 2005, providing also that politics does not derail economic reform.rnrn

A persistent drought, reliance on expensive thermal power and a slowdown in economic and key legislative reforms due to the elections were largely to blame, ADB said in its Asian Development Outlook, released Wednesday.rn

rnThe Bank also warned that a lack of a clear economic policy and uncertainty still surrounding the peace process could also hamper progress.rn

rnldblquote This governments approach to economic policies and to the peace process suggests that peace negotiations and reform implementation will face a period of considerable uncertainty
dblquote , the report says.rn

rnExpected growth is to be driven by exports mainly apparel, and tourism, with exports tipped to grow at 10 percent this year and 9 percent in 2005.rn

rnThe fall in 2005 coincides with the end of quotas, when Sri Lanka will compete on a price