Tuesday, December 6, 2022
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Forex Crisis and National Economy: Our plan ensures a greater stability and encourages more inflows, says CBSL Chief

Notwithstanding the claims made by the World Bank, or any other international fiscal agency, Sri Lanka is on the road to recovery as there is a growth of about 05 per cent in the National Economy this year, said Governor of the Central Bank of Sri Lanka (CBSL) Ajith Nivard Cabraal, speaking to the webinar “Impact of Forex Crisis and Solutions for National Economy” held today (23).

By the end of 2019, the country’s reserves were around US$ 7,642 million and utilising them, as well as other inflows, Sri Lanka was able to pay by the end of 2021 a total of US$ 12,443 million debt, Cabraal reminded, adding that even thereafter the reserves had come down to US$ 3,538 million, making a net payment of about US$ 7,939 million. By the third quarter of 2021, the reserves had come down to US$ 2,481 million, but the ISP (International Sovereign Bond) had been settled by the 18th of January 2021 as the reserves had risen up to US$ 3.1 billion, he added.

Accordingly, the CBSL Governor debunked the fallacy that a country – being subject to bankruptcy – may be unable to pay the debts amid the absence of foreign reserves.

The CBSL Governor emphasised that there are many steps that will lead Sri Lanka to a higher growth trajectory, and the turmoil experienced by the country at present will be curtailed as every challenge is being dealt with.

Like any other country in the world, Sri Lanka is also facing the challenge of increasing inflation, which, as the country is moving forward, should be addressed as well, Cabraal went on, adding that the government’s plan, therefore, should ensure that a greater stability will be brought in, whilst encouraging a greater amount of inflows.

MIAP

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