Apr 28, 2016 (LBO) – Sri Lankan exporters do not have a clear reason to keep their money abroad as the Central Bank has already removed restrictions on foreign currency withdrawals from foreign currency accounts, a senior official said.
Deputy Governor of the Central Bank Nandalal Weerasinghe speaking at an event said the exporters will have a higher return bringing in money here.
“Earlier the exporters had a concern over bring in money into Sri Lanka,” Weerasinghe said.
“Even when they retain them in foreign currency accounts they wouldn’t be able to use it for any purpose without the approval of Central Bank. Now we have done away with that.”
Earlier foreign currency withdrawals were limited for activities like education or medical purposes.
“With that facility I don’t see a clear reason why they won’t bring money here,” he said.
“Because if you bring money here in foreign currency account, it will have a higher return and the same time they don’t have a restriction at all for them to keep that money.”
The Finance Ministry recently issued a gazette notification requiring the repatriation of funds from exports that are retained abroad.
It contained three clauses:
1) Repealing the exemption granted in respect of payment for goods exported from Sri Lanka in the Extraordinary Gazette Notification No. 759/15 dated 26 March 1993.
2) Requiring repatriation of any such payment retained abroad as at 01 April 2016 to Sri Lanka not later than 01 May 2016.
3) Requiring any such payment received on or after 01 April 2016 to be repatriated to Sri Lanka within 90 days from the date of exportation of goods.
The gazette said these proceeds may be credited to any Foreign Currency Account maintained in the name of the exporter in the Domestic Banking Unit of a Licensed Commercial Bank or sold to a LCB.