Diplomatic moves to extend supplier credit to tide over external shocks and stabilise a nervy rupee

Sri Lanka is stretching diplomatic goodwill by asking friendly nations to extend supplier credit to tide over external shocks and ease pressure on the rupee, Treasury Secretary said. Sri Lanka is stretching diplomatic goodwill by asking friendly nations to extend supplier credit to tide over external shocks and ease pressure on the rupee, Treasury Secretary said. The budget deficit has also been revised upwards to 8.5 percent of GDP, as revenue from Ceypetco’s privatisation is unlikely to come through this year.

Key government officials are jetting off to Iran, Malaysia and India to extend credit support for essential imports of fuel, wheat, sugar and milk foods.

Temporary relief will come from the US$ 150 mn Indian credit line, supplier credit from Iran and possibly Malaysia to cover a hefty oil bill, Dr. P B Jayasundara told a news conference on Thursday ahead of the annual budget on November 18.

Sri Lanka imports its refined products on open tender from various countries. Crude imports come from Saudi Arabia, Iran and Malaysia. Ceypetco’s recent letters of credit have been opened at around US$ 47-48, pushing up the country’s year end oil bill to US$ 1.2 bn from US$ 90