Courtesy Hiru News

The Governor of the Central Bank Dr. Nandalal Weerasinghe says that technical discussions have been initiated with the International Monetary Fund and steps have been taken to expedite its process from tonight (08).

A virtual meeting has been requested for 11th April with IMF. The meeting can be held even without the Finance Minister since a Governor and a Secretary to the Finance Ministry has been appointed. Letter of Intent to IMF is to be presented, it will follow the technical process.

He further stated that stability and confidence in the market is expected with the strengthening of the rates, the highest ever increase. The rates were increased by 700 points today. 

The governor said the economy was like a car that is headed towards a crash and his first job is to make sure the car is brought to a halt from the path of destruction. This has to be followed by steps that would reverse the vehicle back.

This a long term process and he said that the situation could get worse before it becomes better.

The CBSL has to be an independent institution without political influence and the governor sais that he will be transparent and provide information truthfully.

“I took this position with the firm belief that I could lead a process to stop the vehicle (economy) crashing and reverse it back. However this requires the support and cooperation of several stakeholders to ensure recover in the shortest possible time. Market confidence through a strong policy framework, political stability and social stability is required.”

Gazettes and regulations are not as effective in a free market economy. Root causes need to be addressed including the reduction of the balance of payment deficit. 

CBSL Governor in response to Vehicle imports restriction noted that the decisions to release foreign currency will have to be made on a case by case basis depending on priority and the overall impact on a larger portion of the population.