Reserves satisfactory despite talks for IMF support: Ravi K

By Ashwin Hemmathagama – Our Lobby Correspondent

Finance Minister Ravi Karunanayake yesterday told Parliament that the country’s reserves were satisfactory though discussions are on with the IMF for a stand-by facility.

“Even though a standby facility is now being discussed with the International Monitory Fund (IMF) the net international reserves of Sri Lanka remains healthy and as expected,” Karunanayke told Parliament yesterday.

Giving reason for the drop in net international reserves from $6.5 billion in 2014 to $6.1 billion this year, Minster Karunanayake said: “We had to use $400 million to settle a bullet payment the previous Government took. However, we noticed Rs.750 million worth of inward remittances after the 2016 Budget was presented in Parliament. This will have a positive impact on net international reserves,” the Minister added.

According to the minister the use of a standby facility may not arise with India starting to devalue the Indian currency, Chinese Government already devalued renminbi, and the US federal reserve increasing the rate by 0.25. “These changes will bring some stability to economies,” predicted Minister Karunanayake.

 “To avoid possible impact on Sri Lanka from the current global financial crisis and a possible ISIS attack in Sri Lanka the stand-by facility is discussed with the IMF. But we will not adhere to their list of requirements without informing the Parliament,” Minister Karunanayake assured Parliament.