No government can deviate from current IMF path: CB Governor

By Nishel Fernando

Colombo, Dec 30 (Daily Mirror) - Central Bank Governor Dr. Nandalal Weerasinghe said yesterday any government could renegotiate the programme with the International Monetary Fund (IMF) but it would be required to follow the path chosen currently to get international support.

Addressing a press conference, he said if the chosen path is broken, no support will be forthcoming internationally.

The IMF programme began on September 1, last year. After disbursing the first tranche, it’s again negotiated what our commitments are before disbursing the next tranche. So, it will be a continuous process of renegotiation to change policies in a timely manner, whatever the government is in power for the next four years. There are no restrictions for that. But, the key element is we need to move forward with the programme in order to obtain international support,” he said.

He said the foreign governments and other commercial entities are extending the debt relief only on the understanding that this programme is moving forward.

“We need to go in this direction, during this period of 10 years of debt restructuring. If that changes, they can also change their decision on the debt relief. So if this is broken, they can say we don’t support this any more. We will have to repay $6 billion per year in debt repayments,” he said.

His remarks came in the wake of certain political leaders, including Opposition Leader Sajith Premadasa vowing to renegotiate the IMF agreement in case they get back to power.

Pix by Pradeep Pathirana