Mrf21 Billion a More Accurate Forecast of Real GDP for This Year – President Mohamed Nasheed

President Mohamed Nasheed has said that Mrf21 billion, at 2003 prices, was a more accurate estimation of real Gross Domestic Product (GDP) that Mrf11.3 billion previously estimated, at 1995 prices, for this year.

In today´s radio address, the President explained the changes brought to the way real GDP is calculated, including the revision of base year, which is revised every eight years, from 1995 to 2003, and the adjustments in the growth figures as a result of the new changes.

The President noted that growth figures over the past 10 years and GDP per capita have recently been adjusted, in light of new production data available with the introduction of tourism goods and services tax and the adjustment of base year for calculating the real GDP.

Average GDP growth for the past ten years was set at 5.8 percent, which, the President, was now revised to be 7.9 percent following the adjustment of base year.

There has also been a significant increase in real GDP per capita for 2011. The President said real GDP per capita for this year estimated to be US$ 2844, at 1995 prices, was now more accurately estimated to US$ 4061, at 2003 prices.

Furthermore, he underlined the amendment to this year´s external debt forecast as a proportion of nominal GDP with the changes in GDP forecast.

He stated that the external debt, which stood at 41 percent of nominal GDP earlier has been revised and now estimated to be 32 percent of nominal GDP.

The President underscored that growth figures and other information vital for sound economic policy decision making have become more accurate and complete with the introduction of tourism goods and services tax earlier this year.

This has enabled the government to make more accurate economic policy decisions, he added.

He stressed that economic growth would be significantly increased when the government´s economic policy was fully implemented with the introduction of new taxes and increased government revenue.

In today´s radio address, President Nasheed also higlighted the first ever community cabinet meeting held in Addu City on Thursday.

He having relevant cabinet ministers explaining the government´s programmes for the development of Addu City directly to the people was a strong morale booster for the people of the region.