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We are not dictated by IMF policy: Finance Minister

Dec 17, 2015 (LBO) – Sri Lanka’s Finance Minister told Parliament Wednesday that the country has a strong balance of payments environment and rejected reports of a gloomy outlook for 2016. “There is no issue with the balance of payments. Our problem is with the trade balance. Our exports have decreased and imports increased,” Finance Minister Ravi Karunanayake said. “But the imports are for capital nature.

So it is not such a dangerous thing. The balance of payments is strong. As of this moment we are not dictated by IMF policy,” he said. The balance of payments is estimated to have recorded an overall deficit of 2,316 million US dollars during the first three quarters of 2015 in comparison to a surplus of 1,996 million US dollars recorded a year earlier.

Finance Minister further stated that the currency devaluation process has nothing to do with the dictates of the IMF. “We have not taken a single step or anything in that nature.
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Only thing is that we have to be realistic to the external threats that are there.” Karunanayake said.
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Shee Lankan
Shee Lankan
8 years ago

Balance of payment deficit is heading for over USD 3 billion. So where will you get the money from ? US interest rates have been raised for the first time in 9 years and expected to go up further by 75basis points next year. Foreign funds may move out. We will have to raise rates to keep them.

Nirmalan Dhas
Nirmalan Dhas
8 years ago

The issue is not economic. The issue is in the first instance structural and in the second instance a consequent failure of policy formulation and implementation. This ensures that Sri Lankan organizations – with a few exceptions – can only compete globally on price but not on value addition. Fixing this may take about twenty years.

It calls for the establishment of an Institute for Organizational Development and Design. It also calls for politicians to legislate and not get involved in development. If the state wants to get involved in development then it should set up a supreme development council and a cadre of development practitioners to handle the development and it must not be filled with the children and relatives of politicians.

Twenty years is far too long for any politician to perceive since most of them have a perceptual range of just about five years. So it seems as though we are caught in a trap. Unless…there are enough people with the capacity to link up and collaboratively guide the ship of state in the right direction…it seems very unlikely that politicians can handle this task…hence the need to sign the open government charter and all that..though I am by no means certain that anyone in the government knows what open government requires and has any intention of providing what it requires.

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