Feb. 21, 2013, 5:59 a.m. EST
By Nupur Acharya
MUMBAI--Sri Lanka's economic growth this year is likely to hit 7.5%, much higher than a forecast by the International Monetary Fund, the country's central bank governor, Ajith Nivard Cabraal, said Thursday.
"We are expecting the IMF to revise [its forecast] upwards because we have a lot more expertise in predicting growth as well as calculating it," Mr. Cabraal told reporters on the sidelines of an event to draw investments into Sri Lanka.
IMF expects the island nation to post growth of 6.25% in 2013, constrained by the need for fiscal consolidation, high inflation and also sluggish recovery in its main trading partners, especially the U.S. and euro zone.
The Central Bank of Sri Lanka maintained a tight monetary policy and imposed a ceiling on loan growth of banks in 2012 to deal with inflation. In December, it reduced its policy rates by a quarter of a percentage point and also ended the cap on banks' loan growth.
"These measures are expected to stimulate the economy to return to a higher growth path this year while maintaining inflation around the targeted levels," Mr. Cabraal said last month.
On Thursday, Cabraal said that he expects foreign direct investment of $1.8 billion this year.