Sri Lanka legislatures cross swords with the CB Governor Nandalal
January 13, Colombo (LNW): Both government and opposition MPS seemed to be crossing swords with the Central Bank Governor Nandalal Weerasinghe over his declaration of preemptive debt default on the first day of his appointment April 12th and his recent remarks on IMF .
This was evident when one Minister told Parliament that the latter had made a startling remark on finances while a prominent member in the opposition declared that they do not trust Mr. Weerasinghe.
Minister Bandula Gunawardena said the recent remark made by the Central Bank Governor is grave.
The Governor has said that future governments as well as the incumbent government are bound to carry out the IMF recommended programme. This is a grave statement.
It is the legislature which has power over finances. It is Parliament which should decide on the economy. Therefore we want a three day debate on the remarks made by the Central Bank Governor, “the Minister said.
Speaker Mahinda Yapa Abeywardana who responded said the party leaders must decide on the debate.
Chief Opposition Whip Lakshman Kiriella said his party does not trust the current Central Bank Governor.
“Central Bank Governor failed to inform Parliament on the country’s bankruptcy. We questioned him on the country’s foreign reserves in 2022 during a meeting.
He responded by saying SL only had $ 20 million as reserves in 2022. It was only then we got to know that the country had gone bankrupt. We cannot trust him because of this conduct on his part,” he said.
Ina previous Select Committee meeting in Parliament, MP Wajira Abeywardana stated that when the Central Bank declared financial bankruptcy, an entire country failed.
The Member of Parliament stated the above when the Select Committee of Parliament to Investigate Causes for Financial Bankruptcy declared by the Government and to Report to Parliament and Submit its Proposals and Recommendations in this regard met recently Chaired by MP Sagara Kariyawasam in Parliament.
Wajira Abeywardana and the former Central Bank Governor Ajith Nivard Cabraal were called before the Committee.
Addressing the Committee. Wajira Abeywardana pointed out that according to the Constitution, the power of financial control vests with the Parliament and because of following a wrong process, the Central Bank declared the country’s financial bankruptcy on 12.04.2022.
The Parliamentarian pointed out that as a result of this, the whole country fell into trouble.
Wajira Abeywardana pointed out that in the first quarter of 2022, $3.9 billion was to be paid and by April 8th, 2022, $3.2 billion had been paid. He pointed out that by April 12th, about 70 million dollars had to be paid to China and in that context, the Central Bank declared financial bankruptcy on April 12th effortlessly.
The Parliamentarian pointed out that this is a wrong process and this should not have happened and there was potential to get support from the private sector and pay this amount.
As a result, he pointed out that a large number of officials of the Central Bank are responsible for the situation in the country and certain individuals were not standing by Sri Lanka at that point in time.
Addressing the Committee, the former Central Bank Governor Ajith Nivard Cabraal pointed out that the declaration of financial bankruptcy was the result of a long-term effort by several groups.
The new Central Bank Governor declared financial bankruptcy on the first day of his appointment, i.e. April 12th, he said. He also pointed out that this is a declaration of debt default made without any national or institutional level discussion.
The former Central Bank Governor Ajith Nivard Cabraal pointed out 3 main points in particular and accordingly, indicated that the announcement of financial bankruptcy on April 12th, 2022, how the bankruptcy took place and the fall in the value of the rupee will be discussed here. He explained at length how the declaration of financial bankruptcy was made on April 12th, 2022, and stated that he would elaborate on the other two points on a future date due to time constraints
