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Economic crisis: Turn to exports or suffer, says CBSL Governor

 

  • Being export oriented, not import dependent the way out

 

Only export-oriented businesses will be able to carry out their operations amidst the current economic crisis, according to Central Bank of Sri Lanka (CBSL) Governor Dr. Nandalal Weerasinghe.

Dr. Weerasinghe noted that the only way out for businesses during the crisis period was to move from being import dependent to becoming export oriented, which the country also had to follow in order to resolve the ongoing crisis in the long term.

The CBSL Governor made these comments at the General Meeting of the Chamber of Young Lankan Enterprises (COYLE) last week.

Dr. Weerasinghe explained that most businesses had found some of the measures taken to address the economic crisis difficult to adapt to.

“There are complaints that the increase in interest rates has had an adverse impact on their businesses. That is the purpose of it. The country is facing a crisis and the economy undergoes a contraction period at such times. When the country is facing such a situation, it should also reflect in other sectors. No one can be exempted from that contraction,” he said.

He went on to say that Sri Lanka was an import-dependent economy, spending more foreign exchange on imports than what it earned. 

“Like in businesses, such situations can only last for a few years and not in the long term. We have to then take loans to fund the deficit and now we are unable to pay the loans taken. Then we have to look at restructuring,” the CBSL Governor observed.

Dr. Weerasinghe reiterated that the only way to survive the crisis was to become export oriented rather than being import dependent. “The export-oriented businesses will manage to carry on while the others will have to operate at very low levels.”