US$ 300 mn to help low-income groups - Governor | Daily News

US$ 300 mn to help low-income groups - Governor

Expects US$ 2 to 3 bn from IMF in three months:

Sri Lanka will offer over USD 300 million out of the USD 600 million due from the World Bank to provide direct financial assistance for low- income families, Central Bank Governor (CBSL) Dr. Nandalal Weerasinghe told yesterday.

At a special press conference held yesterday at the CBSL, he said the World Bank has agreed to provide Sri Lanka with US$ 600 million in financial assistance to help meet payment requirements for essential imports. “We understand that due to the escalating commodity prices especially the low-income families are faced with tremendous hardships and in a bid to financially assist them we will allocate US$ 300 million from this to provide them with a financial ‘package’ to ease their burden. The rest would be used to import essential items.”

Governor also said that their engagement with the IMF and many other donor agencies were very fruitful and they expect around US$ 2 to 3 billion from the IMF once their officials visit Sri Lanka and the collaborative dialogue process is completed. “We expect this to take a maximum of three months.”

In addition several other funding too would come Sri Lanka way through donor agencies, friendly countries and also some key foreign direct investments too are expected. “Due to the IMF engagement which I think we should have done earlier we also are able to restructure our debt.”

Asked if there are any hard conditions laid by the IMF he answered in the negative and added that since the Covid-19 pandemic, the IMF is mostly keen to bailing out countries rather than imposing conditions. “However from a Sri Lanka perspective we have to make a series of long overdue changes to kick start the economy and also increase government revenue and also install political stability.”

Outlining them he said: “These include bringing back the 2019 tax structure which will increase government revenue, re look at restricting some of the bleeding State owned enterprises, increase exports and also increase flow of foreign remittances and ensuring that these come to Sri Lanka through proper banking channels by passing the current unorthodox measures like Hawala and Undial.”He said that as another step towards discouraging Hawala and Undial, the Finance Ministry will issue a new Gazette under the Import and Export Control Act making all payments on imports to Sri Lanka compulsory through an authorized banking system and not on Open Accounts.”Subsequent to this all imported items (sans raw materials and other similar merchandise) would not be allowed to be cleared by customers unless payments for them were made through banking channels.


[Positive response to US Dollar Fund]

Governor Dr. Nandalal Weerasinghe said that the US Dollar Fund that was launched recently has had a very positive response from the Sri Lanka expatriate workers and already USD 37,000 has been collected.“We will divert this money to the Health Ministry to purchase urgent medical supplies.”


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