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Central Bank decides to minimize flow of Dollars out of the country by controlling vehicle imports

ITN News Editor
By ITN News Editor September 20, 2018 19:05

Central Bank decides to minimize flow of Dollars out of the country by controlling vehicle imports

The Central Bank of Sri Lanka has decided to minimize the flow of Dollars from Sri Lanka to other countries through the control of import of goods. It is in this respect that the Central Bank has said that there should be a 100 percent deposit in Commercial Banks for the issue of letters of credit.

The Central Bank said that this initiative has been taken parallel to the fall of the value of the rupee with respect to the U.S. Dollar. Thousands of vehicles were imported to the country following the facilities extended by the present Government in the import of vehicles.

The value of the Dollar in rupees has increased by 350 percent from the year 1977 since the introduction of the open economy. According to statistics, the devaluation of the rupee of the country which imports a large stock of goods is a normal incident. But parallel to the fall of the value of rupees in the last three years, depicts a low value. The Central Bank said that this does not depict a downturn in the economy.

Reserves of the Central Bank were released to the market when the rupee devalued during the past regime. But it is not an appropriate act economically. What should have been done was to control imports, enhancing exports and foreign investments and also increasing tourism revenue. The limitation of vehicle imports is the most suitable solution. The present Government has taken suitable steps to encourage exports and constructing export zones and industrial zones.

Economic scholars point out that the Government’s economic plan is in place with an explicit awareness of the current economic situation.

ITN News Editor
By ITN News Editor September 20, 2018 19:05

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