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UNP questions Central Bank Governor over IMF claims

01 Dec 2021

The United National Party (UNP) has raised questions over the claims made by Central Bank Governor Ajith Nivard Cabraal regarding the conditions being laid down by the International Monetary Fund (IMF). Speaking to the media, UNP Working Committee Member Dinouk Colombage, requested the Central Bank Governor to reveal what conditions have been proposed by the IMF if they were to provide assistance to the country.  “The Governor has claimed that if Sri Lanka was to seek out assistance from the IMF we would have to devalue the currency by 30% and we would have to reduce Government jobs. Where has the IMF made these demands? In 2009 former President Mahinda Rajapaksa’s Government entered into an agreement with the IMF, on that occasion Mr. Cabraal was the Central Bank Governor and he did not oppose such an agreement. Why is he opposing seeking assistance from the IMF this time?” Colombage questioned. Speaking further, Colombage stated that the country is facing a dollar shortage in the banks.  “Today citizens are unable to withdraw dollars from the banks, they are forced to purchase dollars from the black market where they are being sold at over Rs. 240/-. The Government can pretend that the currency is not being devalued, but the rate that banks advertise is not the rate that citizens are able to purchase at,” he said. He went on to request Cabraal to present the Government’s strategy regarding the depleted foreign reserves. “In November 2019 the UNP handed over the Government with US $7 billion in foreign reserves. In the space of two years this Government has reduced our foreign reserves to US $1.3 billion. Without foreign currency available how will this Government pay for food, medicine and fuel?” Colombage added that if the Government was not interested in seeking the assistance of the IMF, they must present an alternative plan to the public to prevent an economic disaster. “This Government has the responsibility to take decisions based on the interests of the public, and not based on individual bias’. The public is facing grave economic hardship, the first step this Government must take is to present a solution to the foreign exchange crisis. If they cannot do this, then many of the other issues in the country will remain unsolved.”

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