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Confusion and chaos around Cabraal press conference

23 Dec 2021

  • Govt. Info Dept. claims scheduled presser cancelled
  • Cabraal says never scheduled
  • Attygalle claims unaware, says uninvited
    BY Shenal Fernando  The Central Bank of Sri Lanka (CBSL) and the Treasury have denied the rumours that a media conference had been scheduled by the CBSL to be held yesterday (22), where CBSL Governor Ajith Nivard Cabraal and Ministry of Finance Secretary S.R. Attygalle were to address the prevailing economic situation of the country, which was, as per the talks, subsequently cancelled due to “unavoidable circumstances”, The Morning Business reliably learns.  However, when The Morning Business reached out to the Department of Government Information, they stated that such a media conference had been scheduled to be held yesterday and was subsequently cancelled. Speaking to us, the CBSL denied that such a media conference had been scheduled to take place yesterday and claimed that they were unaware of the origins of this rumour. Furthermore, responding to our queries in this regard, Cabraal stated that there was no such media conference scheduled to be held yesterday and claimed that there appears to be some misunderstanding.  Similarly, Attygalle denied knowledge of such a media conference and claimed that he had not been informed or invited to attend such a press conference. These rumours have arisen at time when the public and the business sector have increasingly called on the Government and CBSL to disclose how they will address the prevailing economic situation of the country where foreign exchange liquidity has become a major issue as a consequence of Sri Lanka’s foreign reserves falling to a 12-year low of $ 1.6 billion by end November. As per CBSL data, Sri Lanka’s official foreign reserves have fallen to $ 1.6 billion by end November, down 30% from October. Further, from the remaining reserves, liquid foreign currency reserves amount to only $ 1.0 billion, which is sufficient to cover only around three weeks of imports, according to CBSL data. As a consequence of the falling foreign reserves of the country, the Government on Monday (20) decided to hike the price of fuel in order to manage fuel consumption, which, as per the Government, is a major reason for the fall in Sri Lanka’s foreign reserves as the country currently requires around $ 350-400 million fuel imports per month. This hike in fuel is expected to affect most commodity prices and service fees. Both the public and the business sector have called upon the Governor of the CBSL to disclose the current status of the proposed foreign exchange inflows during the period from October to December set out in the CBSL Six-Month Road Map. Despite the Governor of the CBSL promising on several occasions to update the public on the status of the targeted forex inflows  under the Road Map, such an update is yet to be made. In its Six-Month Road Map, the CBSL had disclosed that it would be receiving $ 11.45 billion in forex inflows over the period from October to December. From the above targeted foreign inflows, the Government of Sri Lanka and the CBSL will negotiate for $ 3.9 billion and the remaining $ 6.95 billion includes forex inflows to the domestic forex market with contributions mainly from merchandise exports ($ 3.3 billion), worker remittances ($ 1.8 billion), and service exports ($ 1 billion). With regard to the targeted forex inflows of $ 1.8 billion by way of foreign worker remittances, it seems highly unlikely that this targeted inflow will be achieved considering that remittances during the months of October and November were merely $ 317.4 million and $ 271.4 million, respectively.

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