The move by the Central Bank of Sri Lanka (CBSL) to increase interest rates would be highly problematic for the country’s monetary regulator has no such authority to do so, argued United National Party (UNP) MP Vajira Abeywardena, joining the parliamentary debate on the 2023 Budget yesterday (18).
“The people rose due to a serious problem. In the midst of such a situation, how can one pronounce the country bankrupt? Neither the Finance Ministry nor the Central Bank has such authority. By April 08, the previous regime – whether it was right or wrong – did settle US $ 3 billion from a US $ 6.1 billion debt. By the time the bankruptcy was announced, only US $ 70 was to be paid. What authority does one have to violate the Constitution?” Abeywardena questioned.
The UNP Chairman went on:“See, look at the conspiracy in works today. How I see it, the President tries to wake the country up, but other sectors attempt to walk towards another path. See, now an interest of 30 – 32 per cent has been imposed. This MP said that he had obtained a debt for an interest of 7 – 8 per cent, am I right? Now, how can it be repaid? He said that a land will have to be sold. How do the little men live? The Budget Speech by Mr. Ranil Wickremesinghe read by me and the interest case are not complied with each other. No one has the authority to raise interest rates. The monetary power is possessed by Parliament. So, may we get together and act against it. No party differences are needed here.
“The Central Bank may be independent. An independent Central Bank cannot possess policies” Abeywardena went on, “The Central Bank should act in compliance with the policies of the Finance Ministry. Parliament has the power to control it. Parliament should impose a limit for a maximum interest rate. The public representatives’ houses cannot be allowed to be burnt down by various games based on certain parties’ will. Otherwise, their addresses shall also be disclosed.”
MIAP
