Exchange controls extended by further six months

The Cabinet of Ministers this week gave its nod to extend foreign exchange controls on outward remittances up to June next year, to preserve the country’s foreign currency reserves and minimise pressure on 
exchange rate.

Prime Minister Mahinda Rajapaksa, as the Minister of Finance, Economic and Policy Development submitted the proposal to the Cabinet this Monday.

The exchange controls, which were originally imposed in April through an initial gazette and then through a special gazette in July, were scheduled to expire in January 2021.

As per the initial gazette notification issued in April, outward remittances on capital transactions were suspended for three months, which mainly included the general permission granted to make outward remittances for investments and the outward remittances through business foreign currency accounts (BFCAs) or personal foreign currency accounts (PFCAs) held by companies or persons in Sri Lanka other than for the remittances on current transactions.

Further, the imposed foreign exchange controls limited the eligible migration allowance for emigrants who are claiming the migration allowance for the first time up to a maximum of US$ 30,000.