Sri Lanka’s finance minister has claimed it “is not the end of the world” despite Sri Lanka’s rupee continuing to tumble to record lows this week as foreign investors exited government securities.
The rupee hit a new low of 169.40 per dollar, despite interventions from Sri Lanka’s Central Bank in an attempt to stop the fall. Foreign investors sold a net 110.5 million rupees worth of shares on Thursday, extending the year-to-date net foreign outflow to 5.77 billion rupees worth of equities, according to Reuters.
Despite this, Mangala Samaraweera claimed “the economy is not going to crash”.
“This is not the end of the world. The previous government released Rs.4.1 billion into the market to control the depreciation but it still depreciated by 14%. Ours is only 8% at the moment. Putting money into the market is not the solution. We should somehow manage savings and prevent spending on unnecessary things. MPs, Ministers should stop importing fancy cars. We may have to reduce importing bottles of wine and cheese and stick to local produce for a while. The economy is not going to crash. In a way this is a good point for us to expedite programme to make Sri Lanka an export-oriented economy.”
“The situation will get better,” he claimed. However, added “but I can’t tell when would it be”.