Sri Lanka's new governor of central bank said Friday that the country could achieve 8 percent economic growth despite the current climate of violence prevailing in the island nation.

"Indicators are very good, there are challenges and we can face them to achieve higher growth," Ajith Cabraal, who is to assume the post of the central bank governor on July 1, told reporters.

The central bank on Thursday said the country had achieved a 8. 1 percent growth in the first three months of 2006 from a measly 4 percent growth during the same period of 2005.

The overall projection for growth is estimated at 7 percent for the whole year.

But analysts feel pessimistic that growing violence and the dimmed peace prospects with the Tamil Tiger rebels may slow down the growth.

Cabraal, who is also a top advisor to Sri Lankan President Mahinda Rajapakse, said the present conflict situation will be resolved and there will be a healthy economic climate in the island.

Over 800 people have been killed since the beginning of December last year in the escalation of violence in the country's long drawn out separatist armed conflict.

The Norwegian backed peace process has run into stormy waters with both the government and the rebels accusing each other of perpetrating violence against the other.

Cabraal said the government during last six months had taken the right initiatives to improve the infrastructure -- such as the commencement of work for thermal and hydro power plants and the feasibility study for the construction of a second international airport in the deep south.

An express highway between the capital and the country's only international airport is one of many such infrastructure projects the Rajapakse administration had undertaken, the new central bank governor said.

Sri Lanka's international donors have urged immediate end to the hostilities in order to restore normalcy.

Source: Xinhua