Central Bank calls for ‘fair play’ by all stakeholders of economy

• Says all efforts would be taken to strictly monitor and ensure compliance with all regulations on foreign exchange transactions
• Warns any instances of non-compliance will be dealt with stern action 
• Points out that continual ignoring of regulations imposed would deprive people of the support expected from the govt. in difficult times
• Licensed banks and the trading community urged to comply with existing regulations

The Central Bank yesterday called on all stakeholders of the economy to operate with ‘fair play’ so that the ongoing unprecedented crisis can be resolved at the earliest.

The Central Bank reiterated to all stakeholders of the economy that, going forward, all efforts would be taken to strictly monitor and ensure compliance with all regulations on foreign exchange transactions, including repatriation requirements of export proceeds, conversions, and mandatory sales to the Central Bank.

“Any instances of non-compliance will be dealt with stern action within the provisions of all applicable laws,” the Central Bank cautioned in a statement to the media yesterday.

It shared that despite imposing measures such as surrender requirements on export earnings and introducing margin requirements, among others, it has been brought to the notice of the Central Bank that certain market players are not fully compliant with these regulations.

“Certain market players continuing to ignore the regulations imposed would deprive the people of the support expected from the government in difficult times. Such practices would also undermine the moral obligation of ‘equal burden sharing’ that is expected of all stakeholders under difficult and extraordinary circumstances,” the Central Banks aid.

The financial sector regulator said a major factor that is contributing to the current crisis and the resultant hardships is the lack of foreign exchange liquidity in the banking system. The shortages of forex liquidity has affected the provision of essential imports, including fuel. 

 It went on to assert that overcoming current economic woes and distresses requires substantial and concerted efforts from all stakeholders of the economy. 

Accordingly, licensed banks and the trading community are urged to comply with the existing regulations and complement the efforts of the government and the Cenral Bank to provide much-needed assistance to all stakeholders of the economy under these extremely challenging circumstances.

The export trading community is urged to continue to repatriate all export proceeds within the stipulated timeframe and surrender the residual earnings in accordance with the regulations.  Meanwhile, the banking community is requested to ensure strict adherence to all regulations in relation to foreign exchange transactions. Foul play on the part of any group of stakeholders would inevitably result in the worsening the crisis, thereby having widespread detrimental effects, the Central Bank noted.

“It is the duty of everybody to act conscientiously and responsibly, and extend their unhindered support during this hour of need, for the nation to recover rapidly and emerge stronger from this crisis,” the Central Bank noted.
The monetary watchdog highlighted that together with the government it has relentlessly pursued efforts to secure bridging finance to reduce and alleviate economic stresses in the near term. 

It shared that notable progress has been made in the ongoing negotiations for an economic adjustment programme with the International Monetary Fund (IMF). The debt restructuring process is also underway, capably assisted with the Legal and Financial Advisers, it added.