Sri Lanka’s Central Bank chief confident Sri Lanka can overcome economic crisis within 05 months

Governor of the Central Bank of Sri Lanka (CBSL) Dr. Nandalal Weerasinghe says he is confident that Sri Lanka can come out of this severe economic crisis within a period of 05 months. “We have a clear program and a clear path,” he added.

In an interview with CNN, the governor said Sri Lanka will, however, experience a difficult time until then.

If Sri Lanka has a stable administration from tomorrow onwards, we can make strong decisions by the administration, Dr. Weerasinghe pointed out. Sri Lanka parliament voted in acting-President Ranil Wickremesinghe as the new Head of State in a vote held earlier today (July 20). He will take oaths tomorrow (July 21).

Speaking further, the CBSL governor said he is hopeful that people would be patient until Sri Lanka can ride out the crisis situation over the next couple of months.

When asked if he agrees with President-elect Ranil Wickremesinghe’s claims that the previous government was covering up facts about the country’s crippling financial crisis, Dr. Weerasinghe said, as the governor, it is not appropriate for him to comment on political matters.

With regard to how concerning the country’s current situation is, the governor said the liquid resources in the central bank are almost “non-existent” because these resources had to be utilised to support the import of some shipments of petroleum products and LP gas supplies.

Owing to this, Sri Lanka has managed to secure some shipments of petrol and diesel for the next couple of weeks, Dr. Weerasinghe said further. Beyond that, it is in fact the responsibility of the new government to secure some short-term bridging financing to finance the import of essentials until the country receives the bailout package from the International Monetary Fund (IMF), he added.

Starting from next month, Sri Lanka will negotiate some bridging financing facilities from friendly countries such as India and China, the governor continued. “So we need the new administration to start approaching these friendly countries to secure short-term financing so that we are able to supply essential items to the people to continue their day-to-day lives smoothly.”

When asked about the financial support extended by India and China, the governor said he is hopeful that India would continue to support. However, it depends on the new administration’s negotiations and talks with the neighbouring country, he explained. According to the governor, Sri Lanka has also made some requests from China on relaxing some of the conditions in a swap facility.

If India and China agree to continue to support the island nation, the situation can be improved until the IMF’s bailout package is made available, Dr. Weerasinghe added.

(Courtesy: CNN / Ada Derana)