Govt. to obtain USD 1.9bn to stabilise rupee: PM

10 January 2019 07:12 pm - 26     - {{hitsCtrl.values.hits}}


Outlining the steps government intends to take to stabilise the rupee, Prime Minister Ranil Wickremesinghe today announced a plan to obtain US dollars 1.9 billion from international sources.

Making a special statement in Parliament, Mr Wickremesinghe said the Central Bank of India had agreed to provide US dollars 400 million under the SAARC currency swap program.

The Prime Minister also announced plans to obtain US dollars 500 million from Chinese Panda bonds and from Samurai bonds in Japan.

In addition, he said the government also intends to obtain US dollars one billion from international money markets. He said Finance Minister Mangala Samaraweera will leave for the US soon to work on this.

“Devaluation of the Sri Lankan rupee results in high cost of imported raw materials. This in turn results in high cost of production,” the Prime Minister said.

“Stabilising the rupee should be our priority. We have taken several steps in this direction and had already begun discussions with several countries,” he added.

The Prime Minister said the government intends to stabilise the rupee as one of several steps it had taken to elevate the economy to greater heights and bring it to a better position than what it was prior to October 26 last year. 

“We also intend to bring down the cost of living,” he said.

"We had to face serious challenges in the economic front this year. Sri Lanka’s debt services will be highest in 2019. The total foreign debt service this year will be US dollars 5,900 million. Sri Lanka will have to settle the highest debt installment of dollars 2,600 million on January 14 this year.

"The government planned to settle debts causing minimum burden to the people. We took several steps in this regard including developing the domestic economy, enhancing exports and increasing investments. We also took steps to stabilize the external economy. Our plans were shattered by the political crisis which took place on October 26. The economic growth slowed down, Sri Lanka lost its high financial ratings and the country could not borrow from any donor agency. It will take some time for the country to regain what it lost during the political crisis. We lost investor confidence and it should be restored. We have to show the world that there is political stability in our country," the Premier said.

“Sri Lankan rupee was devalued by 3.8 percent during the 51-day political crisis. A sum of USD 312.9 million had gone out of the country from October 26 and December 16 last year in the form of treasury bonds and USD 29.8 million in the form of treasury bills. In addition, Sri Lanka’s foreign reserves have gone down by USD 1 billion dollars during the 51-day crisis. We are ready to overcome all challenges that come our way. We will stabilize the economy just like the way we brought in political stability from the turmoil,” the Prime Minister said. (Yohan Perera and Ajith Siriwadana)

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  Comments - 26

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  • DHA Thursday, 10 January 2019 07:47 PM

    Don't know who's pocket is going to fill !!!

    Karu Thursday, 10 January 2019 08:09 PM

    In simple terms a loan to repay a loan. Results of cosmetic development without meaningful production

    tommy Thursday, 10 January 2019 08:17 PM

    So now he can blame everything for "political crisis which took place on October 26"

    Gayan Thursday, 10 January 2019 08:19 PM

    I thought you dont like taking loans. Selling assets not enough?

    Gihan Thursday, 10 January 2019 08:48 PM

    Mr Prime Minister, If the Govt. wants to stabilise the Rupee and are serious. For a start, stop allowing govt agencies and ministries quoting charging for services in foreign currencies.

    sam Friday, 11 January 2019 03:08 AM

    USA is partially shut down asking for USD 5bn for their south border (wall) and going for an emergency situation. Sagala will not get USD 1 bn from them. True, that our country is in a trouble. But, what RW doing is playing the game in day-light where MR did under the dark, Basically, getting more loans to fill ministers' needs to run the government. At the end, the county could from bad to worse.

    Hautaum Friday, 11 January 2019 03:42 AM

    We are depending most of things from out of SL, So converte our economy in close system for a decade. Then reduce Palimenterians up to 75, Provecial,local councilers and tri militaries members into half from actual and no governors need for SL (Prez or PM can do such a duties) and also No duty free, or import military hardwares for decade can manage our economy little. Otherwise this straggle will be prevailed forever.

    cheers Friday, 11 January 2019 04:16 AM

    This rogue and the UNP has brought sri lanka on to their knees and he should be held accountable for borrowing all money and robbing in broad day light

    Banda Friday, 11 January 2019 04:54 AM

    Sir, can you eloborate as to how borrowing USD 1.9 billion will stabilise the rupee? Are you saying that it will be sold in the market to offset the demand from importers?If this is simply to pay other loans not sure how your statement of stabilising the rupee will work.Unless there is investment there will not be stability.

    BuffaloaCitizen Friday, 11 January 2019 11:33 AM

    Nobody will invest in a country that practices State criminality, thuggery

    lion Friday, 11 January 2019 04:58 AM

    Fist stop out flow of foreign currency by stopping un wanted imports such as vehicles for politicians luxury vehicles etc., fruits, plastics products from china.

    ICE Friday, 11 January 2019 01:10 PM

    Well said. Mr. PM you must sit down and calculate how much od US$ are being given away to India and China, as well was as lion said "unwanted imports" China and India are simply dumping WASTE in SL. Perhaps all of you are getting a handsome commission!! Please stop this!

    Kumar Friday, 11 January 2019 05:32 AM

    Mr. PM. Please provide adequate incentives for the usage and importing of Electric Vehicles which would help to reduce the country's fuel bill drastically. The monthly fuel bill is one of the significant contributors of the Total Imports of the country and we could save a lot of foreign exchange this way. Most developed countries with sunlight implements this and Sri Lanka is one of the countries which does not encourage Electric Vehicles. Huge duties are imposed for such vehicles at present

    Lankan Man Friday, 11 January 2019 05:34 AM

    You can borrow from former Central Bank Governor at a cheaper interest rate.

    Siva Friday, 11 January 2019 05:38 AM

    All this to stabilize a currency of a country which has at least 2 million of it's citizens in comfortable jobs and defranchised. Make it possible for them to call the country as their country the exchange situation will solve itself without any borrowing. Of course the politics has to be accommodated !!!!!.

    NIHAL Friday, 11 January 2019 05:57 AM


    Angoda Bakka Friday, 11 January 2019 06:05 AM

    Yes, get more loans, make the country a "Debt Nation", and then rob that money to cushion yourself and ask the unborn generations to pay your loans.

    Arnold Friday, 11 January 2019 06:22 AM

    For a small country like SL, 225 members of parliament is too much, specially considering the millions of rupees spent to sustain and entertain each one of them.

    SL Friday, 11 January 2019 07:17 AM

    This 225 bunch required to be chased away naked.

    Rohan Fernando Friday, 11 January 2019 10:54 AM

    Rupee cannot be stabilised with borrowed money. Firstly the economy has to be stabilised by cutting down on useless spending for foreign jaunts by politicians and government officials and having strict code of discipline for all government spending. Then removing all subsidies and duty free special facilities. Moving on to productivity and expanding exports and value addition. Alternate energy to reduce dependency on fossil fuels. Making use of our natural resources such as water, sun, earth, minerals, sea. gems, natural gas etc. Remember, most of the monumental development so of ancient Sri Lanka and post colonial era of DS were built by our own resources and not from borrowings. What went wrong? Politicians without knowledge but with vested interest to rob has ruined this nation. Get rid of them all and have a non-political union to govern this country with responsibility and accountability baked by a peoples forum of legal base.

    siriherath Friday, 11 January 2019 10:59 AM

    The immediate remedy would be to defer foreign repayments by say 5 years. Then invite foreign entrepreneur for viable programme of industrial /manufacturing development following specialist survey and advice with first 10 year profits as payout. Once 20 to 30 such concerns are set up with the mandatory system of thorough maintainable is put in place, the benefits will reap in 10 years for a promising economy. But uncompromising maintenance programme of buildings and machinery is the golden requirement. Most Sri Lankan programmes failed due to lack of it.

    Ali Hu Kai Friday, 11 January 2019 02:10 PM

    From crisis to disaster!

    Nimal Friday, 11 January 2019 02:31 PM

    Did RW say in 2015 that he would boost Sri Lanka's economy by going for loans in billions of dollars? I never heard such a story.

    Hesh Friday, 11 January 2019 03:06 PM

    lol sold off a port for $1billion and took a loan of $2billion to stabilize the currency

    Suffering Citizen Friday, 11 January 2019 04:00 PM

    When the country is faced with WHITE ELEPHANTS like PROVINCIAL COUNCILS, these fellows stupidly increasethe number of members in Local Govt. bodies by doubling the number? All these are wasted tax-payers' money!

    Samson Friday, 11 January 2019 05:44 PM

    You need to show an example by reducing benefits to politicians, which in turn will solve your balance of payments.

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