SJB for floating exchange rate and privatization

By Yohan Perera   

The main opposition Samagi Jana Balawegaya (SJB) through its latest economic blueprint had called for floating of exchange rates, transparent privatization of state assets and to give priority to manage sovereign debt crisis.  

“Sri Lanka’s urgent priority is to manage the sovereign debt crisis by obtaining critical bridge financing, as well as continuing to engage with the IMF, and expediting the debt-restructuring process with creditor assurances,” the blueprint said

“Parallel to the debt restructuring process, we should pursue some short-term bridge finances from friendly nations as well as from multilateral agencies to bridge the external resource financing gap. In obtaining such support, priority should be given to ensure uninterrupted fuel and electricity supply, which is currently restricted, with resulting adverse effects on the economy. Privatization of some state assets remains an option, but frantically selling assets without transparency and competition will be disastrous. The government should establish a transparent and competitive process pertaining to privatization,” it added. 

 
“Balance of payment difficulties and the black-market premium in the official forex market will be eliminated by adjusting the exchange rate to the equilibrium (market) level. This can be done through a transitional phase of floating the currency to permit market forces to reveal the equilibrium rate, and then stabilizing that rate through CBSL intervention in the forex market,” the blueprint also said.