News

Minister of Labour wants Rs. 240 per USD for remittances

 

  • Plans to raise matter in Cabinet 
  • Notes black market rate of Rs. 245

 

BY Pamodi Waravita

The Government must ensure that migrant workers who bring money into the country must be given Rs. 240 per US dollar (USD) for their foreign remittances, despite increasing consumer complaints that rates offered by several banks are on average Rs. 200 per USD, Labour Minister Nimal Siripala de Silva has said.

“Offering a good rate is the best solution for the foreign exchange crisis that the country is facing at the moment. Furthermore, a low rate could lead to migrant workers using irregular channels to send their remittances to Sri Lanka,” said de Silva on Monday (3), noting that he intends to bring the matter to the notice of the Cabinet of Ministers.

De Silva added that the Ministry of Labour aims to send about 300,000 new migrant workers to foreign jobs in 2022 and thus, emphasised that the focus should be on ensuring that the anticipated foreign remittances are duly received by the country.

“Although in the recent past many job agencies have sent a large number of workers for work abroad, USD did not enter the country. When the black market provides a rate of Rs. 245 per USD, which worker would want to send their USD at a rate of Rs. 202 to the country?” questioned de Silva. 

De Silva added that he intends to raise this issue at a cabinet meeting which would involve the officials working on the subject, and stressed that although many workers go abroad for employment, the expected economic strength is not enjoyed by Sri Lanka.

In December 2021, the Central Bank of Sri Lanka (CBSL) issued a directive, stating that any person in possession of foreign currency obtained by purchasing from a bank or an authorised money changer for travel abroad and brought back unutilised into Sri Lanka; withdrawn from a personal foreign currency account for travel abroad; earnings from employment, profession, or business while abroad and brought into Sri Lanka; and acquired and brought into Sri Lanka for deposit in special deposit accounts on or after 1 January 2021 may receive Rs. 210 per USD (an incentivised rate as the current selling rate of the USD, as given by the CBSL, is Rs. 202). The CBSL extended this incentivised rate for the month of January as well.

However, The Sunday Morning reported last month that despite this directive, consumers had said that as of 14 December 2021, an average of Rs. 200 per USD was the rate given by private banks to consumers.

Meanwhile, a controversial gazette notification, released in October 2021, states that it “requires exporters to convert the residual (remaining balance of such export proceeds received), into Sri Lankan rupees, on or before the seventh day of the succeeding month”. The CBSL has stated on their website that the new rules “are applicable for both exporters of goods and services in Sri Lanka”. Many of those who earn foreign salaries claim that banks have been “forcibly converting” their money into rupees, as per this gazette notification. CBSL Deputy Governor T.M.J.Y.P. Fernando had told The Sunday Morning: “If there are Sri Lankan citizens providing a service to an overseas customer or non-resident and receiving some income in foreign currency, that is an export of a service, and in that case, the rule that the CBSL recently issued on export proceeds – the requirement to convert earnings after setting off certain expenses – is applicable to such a person.”