One time Governor and present State Minister of Money and Capital Markets and State Enterprise Reforms, Ajith Nivard Cabraal is to step down from his portfolio as a State Minister and take up the portfolio of Governor of the Central Bank on Wednesday or Thursday, the Minister told Daily News Business.
This is after Central Bank Governor Professor W.D. Lakshman’s announcement that he will resign from his position with effect from September 14 serving little less than two years.
Cabraal said that his resignation from the Ministerial portfolio would be somewhat unusual as even MPs are hesitant to exit Parliament voluntarily. “But I am taking this decision voluntarily to serve the country in a better and bigger way,” Cabraal said.
Defending his stance in requesting the Central Bank Governor post be elevated, similar to a Cabinet Portfolio he said it was needed since the CBSL Governor needs a stronger voice when dealing internationally.
“The world is facing a difficult time and in such a situation, if the Governor of the Central Bank has such a high rank in the country, our stories and actions will be better accepted in the world and would be beneficial to the country. Also, in many parts of the world like China, Vietnam and Singapore, the governorship of the central bank is similar to that of a Cabinet minister. Hence I requested this nature to the President and I am sure it would be accepted. Sri Lanka will record economic growth of over 4.5%. Inflation is in the mid-single digits. Every single debt instalment has been paid on time. The Rupee has faced challenges, but is now stabilizing,” he said. Meanwhile, State Minister Cabraal in an interview with BBC has said Sri Lanka has successfully managed its reserves and forex cash flows to be able to settle its maturing forex debts as well as ensure the adequate supply of all essential imported goods and services.
“However, due to the non-availability of tourism receipts consequent to the Covid pandemic, a corresponding adjustment in the forex outflows including the stopping of imports of vehicles had to be done.
That would be a temporary measure that would necessarily be restored upon the resumption of tourism.
It is sometimes strange that some international news agencies tend to exaggerate the situation in emerging nations and try to portray those countries as being in crisis.
Sadly, such agencies fail to acknowledge the vast improvements that are taking place in countries such as Sri Lanka, even in the midst of this global pandemic.”
“Some economists think the IMF is the panacea for all economic ills, while others can only see a crisis, but no solutions. They fail to understand that the IMF can’t bring 2.5 million tourists who would deliver inflows of USD 4.5 million or increase worker’s remittances or increase gem exports, etc. Nevertheless, the government has assessed the challenge and has already developed a realistic plan which deals with the pandemic-hit economic problems that would be addressed. There is no need for Sri Lanka to go to the IMF and thereby cause unnecessary pain to its lenders and investors.”
Meanwhile, the CBSL Governor defended the decision to impose a 100% cash margin deposit requirement against the importation of selected goods of non-essential/non-urgent nature; he said it was not meant to hurt anybody or any sector of SME companies.
“This decision was taken after two-three months of debate and it was done to reduce trade deficit expansion which was increasing rapidly. I firmly believe that there are a lot of non-urgent and non-essential goods in this list.”
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Clarification on pension
State Minister Ajith Nivard Cabraal said the request for the CBSL governor’s pension was made since he has not received any pension serving as the governor for eight years (2006.07.01 to 2015.01.08) despite legally being eligible for it.
“Since my letter of appointment says that I am entitled to a pension, I did make a request in this regard to former Governor Indrajit Coomaraswamy on February 12, 2019, but with no response. I was not paid my legal pension even after four years of resigning, but I never made any complaints on this to the political victimization committee of any other similar body.
However, I must stress that I never ‘pushed’ and ‘sought pensions’ for other CB Governors to be paid compensation.”
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