We also intend to introduce Internet Banking Guidelines and Security Standards for mobile Central Bank of Sri Lanka – ROAD MAP 2017  Sri Lanka needs to strengthen the AMF/CFT regime by effectively implementing Financial Action Task Force (FATF) recommendations in order to upgrade the country rating. If Sri Lanka fails to achieve the expected level of compliance, the country may be considered as a high risk country, resulting in adverse implications on the financial sector. In order to overcome such challenges and hence to ensure compliance, the Central Bank will focus on a number of strategic actions in the medium-term. I would also like to note that the Microfinance Act came into effect on 15 July 2016. In line with this, the Department of Supervision of Microfinance Institutions (DSMI) was 24  established at the Central Bank of Sri  management model, where the  Lanka to carry out the responsibilities, as  operational managers form the first line  stipulated in the Microfinance Act No. of defense, and the Risk Management  06 of 2016 and implement policies  and Internal Audit Departments  approved by the Monetary Board to  constitute the second and third lines of  ensure good governance, transparency  defense, respectively. and stability of Microfinance Institutions  Moreover, in view of the need to build a  (MFIs).
The relaxed monetary  and third quarters of the year and  policy stance pursued in the past and the  subdued demand conditions in the major  increase in wages in the economy also  export destinations affected this  exerted some demand pressures on  growth. Industry-related activities grew  prices. Accordingly, headline inflation, as  substantially in 2016 with considerable  measured by the year-on-year change in  contribution from the recovery of the  the Colombo Consumers’ Price Index  construction sector. Notable growth  (CCPI, 2006/07=100), was 4.1 per cent in  was also witnessed in manufacturing,  December 2016 compared to 2.8 per  and mining and quarrying activities. cent in December 2015. Headline  Meanwhile, the growth in Services  inflation, as measured by the year-on  activities also remained buoyant,  year change in the National Consumer  supported by improvements in financial  Price Index (NCPI, 2013=100), was 4.1 per  services, and wholesale and retail trade  cent in November 2016 compared to 4.2  activities. Based on these developments  per cent at end 2015. Accordingly, overall  so far, it is projected that the economy  inflation has been contained within our  would grow by around 4.5 – 5.0 per cent  mid-single figure target of 4 – 6 per cent. in 2016.