100% cash margin rule on non-essential imports removed

The 100 percent cash margin rule on non-essential imports will be removed with immediate effect, the Central Bank Governor Ajith Nivard Cabraal said.

Presenting the ‘Six-month Road Map for ensuring macro-economic and financial system stability,’ Cabraal this morning, Cabraal said a decision towards this was taken considering the hardships faced by the importers and consumers as a result of significant increases in prices of such commodities.

The Central Bank under the previous Governor Prof.W.D. Lakshman, in early last month decided to impose a 100 percent cash margin deposit requirement against the importation of selected goods of non-essential/non-urgent nature made under letters of credit.

“The decision to impose the cash margin deposit requirement is expected to support the ongoing efforts to preserve the stability of the exchange rate and foreign currency market liquidity, particularly by discouraging excessive imports of speculative nature,” the Central Bank said.

Pix by Pradeep Pathirana