Eran accuses Cenral Bank of failure to control inflation and stabilize financial system

SJB MP Eran Wickramaratne says the Central Bank has failed in its two main responsibilities of controlling inflation and maintaining the stability of the financial system.

Addressing the media on Thursday Wickramaratne warned the government that if the Central Bank was not allowed to maintain its independence as envisaged in the Monetary Law Act, and does not adopt a proper system to control inflation and financial stability, prices will continue to rise to unaffordable levels.

SJB Economic Center member MPs Kabir Hashim, Eran Wickramaratne, and Dr. Harsha de Silva, visited the Central Bank Tuesday and discussed with the Governor and other senior officials about the Central Bank’s policies and the problems faced by the people as a result of rising prices and the shortage of essential goods and services due to the dollar crisis.

Wickramaratne further elaborating on their discussions with CBSL Governor and the senior officials said that the Opposition and economic experts from the very beginning alerted that this government is pursuing wrong policies, and as a result, the country would face even more crises if the central bank did not adopt the right approach to controlling inflation.

He said that he was not satisfied with the method adopted by the Central Bank to control prices and that the main reason that led to this deteriorating situation was the Central Bank did not act independently.

“We pointed out the current shortcomings of the Central Bank and made positive comments in this regard. The Yahapalana government amended the Monetary Law Act to enable the Central Bank to discharge its key responsibilities independently,” Wickramaratne said.

“When we drew their attention to the second responsibility of maintaining financial stability, the officials gave a patient hearing to our suggestions. We also informed them about the introduction of a method of systematic removal of moratorium loan grace periods given to people from different walks of life as they have taken different loans due to situations that went beyond their control.”

He said that it is the responsibility of the Central Bank as well as the Government to protect the businesses of the country by providing relief to the businessmen who are unable to repay their loans due to circumstances beyond their control. If the debt relief period is not extended the country will have to face another crisis, he warned.