By Madhusha Thavapalakumar
Sri Lanka is facing the very real possibility of not being able to release second quarter GDP (Gross Domestic Product) data for 2020 within the year, even though it is usually released every year before mid-September.
In mid-October, issuing a press statement, the Department of Census and Statistics (DCS) said that second quarter GDP data will be released on 15 December, along with GDP data of the third quarter of 2020. The reason provided for the delay was the seven-week-long curfew imposed through half of the second quarter, which resulted in some economic activities taking place in ways different to their norms.
When The Sunday Morning Business contacted the Department to confirm if the 15 December deadline would be met, DCS Director General Dr. I.R. Bandara said that it is uncertain, as only 50% of DCS employees are currently reporting to work and that too on a rotational basis.
“Our ability to release GDP data by 15 December, as promised, depends on the ongoing situation. We will try to release it on the said date somehow, but it may be further delayed,” Bandara added.
Samagi Jana Balawegaya (SJB) parliamentarian Dr. Harsha de Silva, in a tweet on 17 October, charged that this is the first time since quarterly publishing where Sri Lanka’s GDP figures have not been published by a government and termed it a “disgrace”.
When asked whether the DCS had been influenced or pressured to hold back the GDP data or to manipulate the figures to produce more favourable data, she gave the following reply.
“The DCS is still in the process of collecting data for the second quarter and we have been advised to study the gathered data further by the Central Bank of Sri Lanka (CBSL) and the Ministry of Finance.”
In the mid-October press release, the DCS also said that international consultants are required to achieve accurate data.
“It is imperative to discuss with international consultants the methods of estimating the output value of certain industry and services activities. It was also decided to collect data on some of the above economic activities from other sources,” the release stated.
Meanwhile, Bandara noted that the DCS had a number of webinars with international consultants on how other countries are calculating their GDP amidst the pandemic. Nevertheless, she stated that no changes would be made to existing methodologies used by DCS to capture the data.
In a second tweet in response to the press release issued by the DCS, MP de Silva stated: “Come on DG! You cannot give such lame excuses that you need a foreign consultant to calculate GDP. India, Thailand, Vietnam, and so many others have already published 2020 2Q. You have now completely lost your credibility.”
Responding to de Silva’s tweet, Bandara stated that it is not necessary for Sri Lanka to consult international consultants and that the consultations so far have been merely for knowledge-sharing purposes.
In terms of de Silva’s latter claim that India, Thailand, and Vietnam have released their GDP estimates, she noted that these countries have a statistical business registry where businesses are registered.
“With the statistical business registry, it is easy to capture GDP data. We have already prepared a cabinet paper to set up a similar registry in Sri Lanka. We are working on it,” Bandara added.
The reason for the absence of a statistical business registry all these years is mainly the inconsistency of registered businesses in Sri Lanka, according to her.
De Silva also stated that internal sources had informed him that the GDP contraction for the second quarter is a shocking -17%. A World Bank report compiled prior to the detection of the new and largest Covid-19 cluster in Sri Lanka projects the island’s economy to contract by -6.7% this year, which would point to a far more severe contraction if the ongoing situation in the country is taken into account.
National economic data of Sri Lanka for the first quarter of 2020 was released on the night of 4 August, a day prior to the general election, and it showed that the economy had contracted by 1.6%. As the data was released following a highly unusual delay, this led to intense speculation as to the reasons for said delay. Many opined that data was being held back intentionally till the end of the election, which was on 5 August, so as to prevent any political disadvantage. However, both the DCS and the CBSL denied this allegation in August and attributed the delay purely to the pandemic.
When The Sunday Morning Business contacted the Department to confirm if the 15 December deadline would be met, DCS Director General Dr. I.R. Bandara said that it is uncertain, as only 50% of DCS employees are currently reporting to work and that too on a rotational basis.
“Our ability to release GDP data by 15 December, as promised, depends on the ongoing situation. We will try to release it on the said date somehow, but it may be further delayed,” Bandara added.
Samagi Jana Balawegaya (SJB) parliamentarian Dr. Harsha de Silva, in a tweet on 17 October, charged that this is the first time since quarterly publishing where Sri Lanka’s GDP figures have not been published by a government and termed it a “disgrace”.
When asked whether the DCS had been influenced or pressured to hold back the GDP data or to manipulate the figures to produce more favourable data, she gave the following reply.
“The DCS is still in the process of collecting data for the second quarter and we have been advised to study the gathered data further by the Central Bank of Sri Lanka (CBSL) and the Ministry of Finance.”
In the mid-October press release, the DCS also said that international consultants are required to achieve accurate data.
“It is imperative to discuss with international consultants the methods of estimating the output value of certain industry and services activities. It was also decided to collect data on some of the above economic activities from other sources,” the release stated.
Meanwhile, Bandara noted that the DCS had a number of webinars with international consultants on how other countries are calculating their GDP amidst the pandemic. Nevertheless, she stated that no changes would be made to existing methodologies used by DCS to capture the data.
In a second tweet in response to the press release issued by the DCS, MP de Silva stated: “Come on DG! You cannot give such lame excuses that you need a foreign consultant to calculate GDP. India, Thailand, Vietnam, and so many others have already published 2020 2Q. You have now completely lost your credibility.”
Responding to de Silva’s tweet, Bandara stated that it is not necessary for Sri Lanka to consult international consultants and that the consultations so far have been merely for knowledge-sharing purposes.
In terms of de Silva’s latter claim that India, Thailand, and Vietnam have released their GDP estimates, she noted that these countries have a statistical business registry where businesses are registered.
“With the statistical business registry, it is easy to capture GDP data. We have already prepared a cabinet paper to set up a similar registry in Sri Lanka. We are working on it,” Bandara added.
The reason for the absence of a statistical business registry all these years is mainly the inconsistency of registered businesses in Sri Lanka, according to her.
De Silva also stated that internal sources had informed him that the GDP contraction for the second quarter is a shocking -17%. A World Bank report compiled prior to the detection of the new and largest Covid-19 cluster in Sri Lanka projects the island’s economy to contract by -6.7% this year, which would point to a far more severe contraction if the ongoing situation in the country is taken into account.
National economic data of Sri Lanka for the first quarter of 2020 was released on the night of 4 August, a day prior to the general election, and it showed that the economy had contracted by 1.6%. As the data was released following a highly unusual delay, this led to intense speculation as to the reasons for said delay. Many opined that data was being held back intentionally till the end of the election, which was on 5 August, so as to prevent any political disadvantage. However, both the DCS and the CBSL denied this allegation in August and attributed the delay purely to the pandemic.