“There is no need to tap into emergency funds,” Finance Minister Mangala Samaraweera said in an interview with Bloomberg TV on May 3.
He was responding to a line of questioning on the health of the Sri Lankan economy. Samaraweera said that his informal conversations with the banks in Fiji had been positive in the unlikely scenario that the country seeks extra financing.
Minister Samaraweera was in Fiji, attending the Asian Development Bank’s annual sessions held in that country.
Post the bombing the rupees has not depreciated significantly and the trading of rupees bonds have not shown any signs of distress. Samaraweera said, “the Sri Lankan economy is bouncing back (from the bombing) much quicker than we anticipated.” Samaraweera cited the high import cover of the current level of reserves. “The biggest risk would be a continuation of such attacks,” said Samaraweera. He added, “the initial attack took place because of some security and intelligence issues. However, in a very short period of time, the security forces and the police are on top of the situation.”
Samaraweera said, “tourism collapses in any country the moment there is a terrorist attack.” He said “to start off with (tourist industry has requested) duty-free waivers for security equipment. We will give serious consideration with quick decisions (to their requests). With the right actions, tourism can bounce back to normal.”
Meanwhile, Central Bank Governor, Dr. Indrajit Coomaraswamy in press interviews had said that Sri Lanka had front-loaded more than half of its borrowings for the year and that the country was in a very comfortable position to service its foreign debt. In the previous monetary policy announcement, he signaled a high likelihood of domestic rates being cut in the third monetary policy review taking place on May 31.
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