Business
Central Bank eyeing USD 8 -10 billion currency reserves in 3-4 years
IMF has shown the way and now Sri Lanka has to dig itself out of the mess, says Governor
by Sanath Nanayakkare
Central Bank Governor Dr. Nandalal Weerasinghe recently said that Sri Lanka needs to build and keep a ‘comfortable level’ of currency reserves in order to maintain the country’s balance-of-payments situation in the event of any external shocks or unforeseeable emergencies.
The Governor made this comment during an interview with Sri Lanka Rupavahini Corporation’s Big Question’ programme.
“Foreign debt restructuring will be a key pillar in this exercise. Sri Lanka’s foreign loan repayments currently stand at USD 6 billion per year. If a part of these debt repayments can be restructured, that will give the country more space to secure the funds it needs to repay its loans and pay for its essential imports going forward. Say, for example, if it can be restructured to pay USD 2 billion per year, then the balance USD 4 billion will remain in our reserves. Thus we should be able to gradually increase our reserves within 3-4 years to build it up to USD 8-10 billion. If this could be achieved, it would be a relatively strong position because in case of an oil price shock or any other unforeseeable emergency, we would have enough reserves to face it. This is why bringing the currency reserves to a comfortable and safe level while repaying our foreign debt is important,” he said.
“The depletion of currency reserves was the main cause for going into the crisis last year. When I was appointed Governor of the Central Bank in April 2022, there was only USD 20 million usable reserves. Once we paid our loans, there was no money left in hand to import essential commodities. Those days we had to depend on daily inflows to tide us over. That’s not a good situation. For the economy to stabilize, we need to increase our reserves up to at least USD 8 billion,” he said.
According to the Governor, country’s currency reserves would reach close to USD 3 billion at the end of this month with the Chinese SWAP of USD 1.6 billion.
However, the Governor emphasized that there are two main pillars the country must prioritize in building foreign reserves before looking at foreign debt restructuring.
“We have to increase our export earnings by diversifying our exports and increase our expatriate workers’ remittances. Keeping our imports at a manageable level as against our exports is another key element. Thirdly, working proactively to increase our tourism earnings would help increase our reserves. These should be our prime targets. Yes, then as you mentioned, if we receive a loan from the IMF, the World Bank or the Asian Development Bank, that will also help boost our reserves. It’s important to methodically reduce the import expenditure and increase export earnings, then the surplus would add to our reserves.
When asked whether the IMF would really dig Sri Lanka out of the mess, the Governor said,” What is the need for IMF to dig Sri Lanka out of the mess? It’s not a problem of the IMF. The government now has to keep its pledges on fiscal discipline and fiscal consolidation and move ahead in the right direction with consistency, without veering away from the agreed upon benchmarks for political reasons. India, Korea, Thailand and Indonesia also went to IMF post- Asian financial crisis. They didn’t go to IMF again because they implemented the programmes and there was no need to go again. IMF gives its members’ money and that is why it took a long for them to give us money as our debt was unsustainable. They help member countries facing balance of payment issues with members’ funds and show them the way to stabilize themselves. So it is up to us to dig ourselves out of the mess,” the Governor said.
The Delegation of German Industry and Commerce in Sri Lanka (AHK Sri Lanka) proudly facilitated the first-ever Sri Lankan delegation’s participation at Drupa 2024, the world’s largest trade fair for the printing industry and technology. Held after an eight-year hiatus, Drupa 2024 was a landmark event, marking significant advancements and opportunities in the global printing industry.
AHK Sri Lanka played a pivotal role in organising and supporting the delegation, which comprised 17 members from the Sri Lanka Association for Printers (SLAP), representing eight companies from the commercial, newspaper, stationery printing, and packaging industries. This pioneering effort by AHK Sri Lanka not only showcased the diverse capabilities of Sri Lanka’s printing sector but also facilitated vital bilateral discussions with key stakeholders from the German printing industry.
Business
Unveiling Ayugiri: Browns Hotels & Resorts sets the stage for a new era in luxury Ayurveda Wellness
In a captivating reimagining of luxury wellness tourism, Browns Hotels & Resorts proudly unveiled the exquisite Ayugiri Ayurveda Wellness Resort Sigiriya. This momentous occasion, celebrated amidst a vibrant and serene grand opening on the 6th of June, heralds a new chapter in the Ayurveda wellness tourism landscape in Sri Lanka. Nestled amidst 54 acres of unspoiled natural splendour, Ayugiri features 22 exclusive suites and stands out as the only luxury Ayurveda wellness resort in the country offering plunge pools in every room, rendering it truly one-of-a-kind.
The grand opening of Ayugiri Ayurveda Wellness Resort was an enchanting event, where guests were captivated by the melodies of flutists and violinists resonating through Sigiriya’s lush landscapes. As traditional drummers and dancers infused the air with vibrant energy, Browns Hotels & Resorts’ CEO, Eksath Wijeratne, Kotaro Katsuki, Acting Ambassador for the Embassy of Japan and General Manager, Buwaneka Bandara, unveiled the resort’s new logo, marking a significant moment witnessed by distinguished guests from the French Embassy, Ayurveda and wellness enthusiasts along with officials from the Sigiriya area, LOLC Holdings and Browns Group.
“Our strategic expansion into wellness tourism with Ayugiri Ayurveda Wellness Resort Sigiriya symbolises a significant milestone for Browns Hotels & Resorts. Wellness tourism has consistently outperformed the overall tourism industry for over a decade, reflecting a growing global interest in travel that goes beyond leisure to offer rejuvenation and holistic well-being. By integrating the timeless wisdom of Ayurveda with modern luxury, we aim to set a new standard in luxury wellness tourism in Sri Lanka. Whether your goal is prevention, healing, or a deeper connection to inner harmony, Ayugiri offers a sanctuary for holistic well-being” stated Eksath Wijeratne.
Ayugiri encapsulates the essence of life, inspired by the lotus flower held by the graceful queens of the infamous Sigiriya frescoes. Just as the lotus emerges from the murky depths, untainted and serene,
Ayugiri invites guests on a journey of purity and rejuvenation, harmonised with a balance of mind, body and spirit, the essence of nature, echoes of culture and the wisdom of ancient Ayurvedic healing.
HNB General Insurance, one of Sri Lanka’s leading general insurance providers, has been honored as the Best General Bancassurance Provider in Sri Lanka 2024 by the prestigious Global Banking and Finance Review – UK.
The esteemed accolade underscores HNB General Insurance’s unwavering commitment to excellence and its outstanding performance in the field of bancassurance. Through dedication and hard work, the HNB General Insurance team has continuously endeavored to deliver innovative insurance solutions, cultivate strong relationships with banking partners, and provide unparalleled service to customers nationwide. This recognition is a testament to the team’s dedication and relentless pursuit of excellence in the bancassurance business.
“We are honored to receive this prestigious award, which reflects our team’s tireless efforts and dedication to delivering value-added insurance solutions and exceptional service through our bancassurance partnerships,” said Sithumina Jayasundara, CEO of HNB General Insurance. “This recognition reaffirms our position as a trusted insurance provider in Sri Lanka and motivates us to continue striving for excellence in serving our customers and communities.”
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