Constituent policy

Several policy adjustments already made – Central Bank

Commenting on the International Monetary Fund (IMF) staff report under Article IV on Sri Lanka, the Central Bank (CB) said that it continues to publish its analysis, that it provides the government with more policy issues and engaged in a continuous and close dialogue with the government.

In a press release, the bank said that several policy adjustments had already been made by the Ministry of Finance and the CB, including the tightening of monetary policy since August last year, allowing exchange rate flexibility, lifting restrictions on foreign exchange market transactions, implementing increased revenue and allowing market-based price adjustments for key commodities.

While the government indicates it is seeking closer engagement with the IMF, the BC stands ready to cooperate in such engagement, the statement said.

Finance Minister Basil Rajapaksa and senior ministry officials are due to meet IMF officials in Washington next month.

Minister Rajapaksa held talks with a senior IMF official this month and asked for the global lender’s help to boost its rapidly falling reserves and tackle its falling currency and rising inflation.

The Article IV process included:

(a) a visit to Sri Lanka by an IMF staff team in December last year during which consultations were held with the Ministry of Finance (MoF) and the Central Bank, and several other government agencies, financial institutions , private organizations and individuals,

(b) additional clarifications requested by the staff team upon their return to IMF headquarters,

(vs) discussion in the IMF Executive Board on the Article IV report, at which time the Sri Lankan authorities had given their agreement in principle to the publication of the report

(D) a press release issued by the IMF following the Executive Board discussion,

(e) an IMF team visiting the country to brief the President on the findings of the Article IV consultation,

(F) final clearance being provided by the Sri Lankan authorities, and

(g) publication of the final report on March 25.