State Minister of Money and Capital Markets and State Enterprise Reforms Ajith Nivard Cabraal yesterday vehemently refuted Opposition concerns over the rupee being quoted different rates by banks.
He told the Parliament that the Opposition MP have confused the spot rates and forward rates given by the banks, whilst assuring that Central Bank confirmed the rupee appreciated by 8 cents against the US Dollar yesterday to Rs. 191.88.
“The Opposition MP was in a rush to bring this up in Parliament and read out the six months forward rates instead of the spot rates. I called the Central Bank and got the correct figures, and in fact today (20) the rupee appreciated by 8 cents against the US Dollar to Rs. 191.88,” he said.
As a Member of the Parliament (MP), Cabraal said the country expects more credibility from such economic experts that represent the people of the country.
“It is such a pity that we have MPs of this calibre that are waiting for opportunities to deceive the general public as well as the entire business community with baseless remarks in the Parliament,” he said.
He claimed the Opposition that is highlighting rupee fluctuation is responsible for the Rs. 51 depreciation caused during the past five years of their regime.
“In 2005 when President Mahinda was elected it was Rs. 105 against the US Dollar and when the new Government was elected in 2015 it was Rs. 131 against the US Dollar. During those nine-years, the rupee was depreciated only by 2.5% and we thought that they could maintain the same for another 10 to 20 years. However, when they gave back the country in 2019 it was Rs. 181 against the dollar and this too was after spending over $ 10 billion of our foreign reserves to stabilise the rupee,” he said.
Cabraal also said that foreign reserves have dropped to $ 4.1 billion at present, but the Government has already taken steps and used different tools to improve it to $ 7.2 billion within the next few quarters.
“We have already signed a Yuan 10 billion or about $ 1.5 billion swap deal with China for three years, which can be used anytime – but we will use it only when necessary. We also obtained a $ 500 million loan from the China Development Bank.
“The International Monetary Fund (IMF) looks set to issue $ 650 billion in currency aid to countries hit hard by the coronavirus pandemic and of that we are also getting $ 800 million. We are well equipped with the tools and organised to deal with any situation that comes our way. This is the bitter truth that no one want to tell the public,” he said.
The State Minister also pointed out that his recent visits to Qatar and Oman were very successful and the outcome of it would be seen in the near future with the high demand for Sri Lanka’s Treasury Bonds and Bills.
Cabraal called on the Opposition MPs not to give wrong interpretations on the foreign exchange rates of the country, as it would reflect negatively internationally.
“We will use all tools to strengthen the rupee to ensure we will be in a better position to service our debts, increase our foreign reserves and to achieve a 6% GDP growth within the next few quarters. We hope you all as Sri Lankans will help us drive this economic development,” he said.
(FT)