Take prompt measures to stabilize rupee: JVP
The Janatha Vimukthi Peramuna (JVP) yesterday urged the government to introduce short-term measures without delay so as to stabilize the rupee on the basis that the rupee depreciation against other currencies would lead to a severe economic crisis. JVP leader Anura Kumara Dissanayake told a news conference that the rupee depreciation was the result of the government’s botched economic policies and unfortunately it had no plans to rectify the situation. “The rupee is depreciating by the day with there being no plans to curb this situation. The Finance minister had recently claimed that the rupee depreciation did not amount to an economic collapse. But the rapidly depreciating rupee is a clear sign of such a catastrophe,” he said.
Mr. Dissasnayake said the government claims that rupee was depreciating because of the strengthening of the US dollar was only half the truth because the rupee was not only deprecating against the US dollar but also against the other currencies as well.
“Rupee has deprecated by 7.3% against the Euro, 10% against the Yen, 2% against the Australian dollar, 4% against the Singapore dollar, 4% against the Chinese Yuan, 8% against the Bangladesh Taka and 7% against the British pound. This is a clear reflection on the government’s disastrous economic policies,’ he said.
Mr. Dissanayake said it was not only this government but also past governments must take the responsibility of this unacceptable situation.
He said several reasons including the mounting trade deficit, contraction of the Sri Lanka’s share in the world market and selling of dollar earning state resources to foreigners had aggravated the issue.
“We have lost dollar earning resources while increasing imports. We had a positive trade balance in 1970. Today we have a 100% trade deficit. We have sold 64% of the container terminal in the Colombo port. Country’s bunkering services was handed over to foreign companies. Sri Lanka Telecom was sold to a foreign company. All these are lucrative dollar-earning business ventures,” Mr. Dissanayake said. “Our share in the world market which was 5 per cent in 1970 has now dropped to 0.045 while the country’s production sector had collapsed with Sri Lanka’s share in the world market dropping by tenfold.”
We have lost dollar earning resources while increasing imports. We had a positive trade balance in 1970. Today we have a 100% trade deficit
He said it was vital for the government to introduce short-term measures to stabilize the rupee because the fluctuation of the rupee had restricted the inflow of dollars to the country while it was equally important to take steps to reduce the trade deficit and acquire a fair share of the world market as a long-term measure.