- Plan to release by 15 Dec.
- Current delay unprecedented
- Stats Dept. ‘working nights and weekends’
Speaking further, she noted now that the second wave of the virus has been hampering normal economic activities once again since 4 October, capturing the economic activities for the fourth quarter will be just as hard as it was for the second quarter.
“The fourth quarter might face a little delay. We cannot confirm it now,” she stated.
Meanwhile, addressing the Sri Lanka Economic Summit 2020 held last week, Central Bank Governor Prof. W.D. Lakshman stated that the second quarter performance would have been worse, but the GDP estimates for any period after the first quarter are not yet available, adding that high-frequency data indicate a strong recovery in many areas of economic activity in the third quarter, prior to the resurgence of Covid-19 infections and resultant containment measures starting from October 2020.
“As in the case of statistical agencies worldwide, the DCS is perhaps grappling with the identification of suitable statistical apparatus to properly measure value added in economic activities that have undergone significant structural changes and the increasing emergence of new ways of doing things during these Covid-19-affected times. Compilation work has also become challenging with social distancing and office closures weighing negatively on response rates and the accuracy of surveys,” Lakshman added.
Speaking further, he stated that the Central Bank had to be innovative in its forecasts and other analytical work with this data absence, constantly generating alternative statistics in response to these unusual circumstances. Using some real-time indicators, the Central Bank released a brief presentation in late September with evidence of the economy’s recovery in the third quarter of the year as a result of the resumption of economic activity, having successfully combated Covid-19.
In mid-October, issuing a press statement, the 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.
In any other year, the quarterly GDP estimates are released in less than three months after the quarter ends. For example, second quarter GDP results are generally released before 15 September. However, citing pandemic challenges, even the first quarter GDP estimates were delayed significantly as they were issued only hours before the general election in August. It showed that the economy had contracted by 1.6%.
As the data was released following a highly unusual delay, it 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.
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”.
In the mid-October press release, the DCS also said that international consultants are required to achieve accurate data.
In a second tweet in response to the press release issued by the DCS, Dr. 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 Dr. de Silva’s tweet, Bandara at that point told us 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 Dr. 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.
Dr. 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.