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Cabraal says Central Bank will guide markets
ECONOMYEXT – Sri Lanka’s central bank will guide markets and deploy monetary tools mindful of repercussions, and guide markets in turbulent times, newly appointed Central Bank Governor Nivard Cabraal said last week.
“The policy measures must be taken,” Cabraal told a forum of senior central bankers and finance officials after taking office as Governor for the second time on September 15.
“There are no short cuts. Sometimes there are tough policy measures to be taken.
“When we take policy measures there are always repercussions from another side. Sometimes if you do not take those policy measures you meander along.”
“When a tool is used, and one area is getting cured, it can emerge as a problem in another area,”
“It is not easy to manage this balance. You have to be conscious of all the outcomes that generally arise when you take certain policy measures.”
Cabraal who was previously central bank chief from 2006 to 2014 said the central bank hoped to guide markets.
“We would need to lead the economy in these measures,” he said. “That means we have to be always one step ahead, two steps ahead sometimes three steps ahead.
“I think we would from now onwards take the lead in providing guidance to markets as well as the economy.
“We have got to take that step clearly and boldly so that the market would be able to read the signs that the central bank is making so that would need to use that guidance particularly in turbulent times like what we having now.
“This is not the time to abrogate that leadership role.”
Cabraal said he expected to seek the views of market participants and also staff.
He said some people wanted advice from outsiders like the International Monetary Fund but there was a lot of knowledge within the bank.
“Once course of action is decided, it has to be steadfastly followed, he said.
Sri Lanka’s gross forex reserves are now down to 3.5 billion US dollars and net reserves depleted after record money printing not seen in the history of the soft-pegged central bank.
Central banks that print large volumes of money and lose reserves become helpless and market participants also become helpless as the newly injected liquidity creates forex shortages, hit the exchange rate and drives up asset prices.
When rate normalization is delayed and net foreign assets turn negative, a central bank itself can rapidly accumulate quasi fiscal losses and lose its ability to carry out policy, analysts say.
News
French Ambassador pledges support for relief efforts
A meeting between the Secretary to the President, Dr. Nandika Sanath Kumanayake and the French Ambassador to Sri Lanka, Rémi Lambert, was held on Tuesday (09) afternoon at the Presidential Secretariat.
During the discussion, the French Ambassador assured the Secretary to the President that the French Development Agency would extend its support to the Government’s programme for providing relief to those affected by Cyclone Ditwah and for rebuilding Sri Lanka. He further stated that steps are being taken to dispatch a team of experts to the country in the near future.
The Deputy Head of Mission at the French Embassy, was also present on this occasion.
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India extends multi-front support to Sri Lanka’s cyclone relief efforts
India has strengthened its humanitarian support to Sri Lanka in the aftermath of Cyclone Ditwah, providing critical air assets, emergency supplies, engineering equipment and medical aid to bolster national rescue and recovery operations.
India dispatched an additional MI-17 helicopter to assist the Sri Lanka Air Force (SLAF) in ongoing air rescue missions on Tuesday (09). Two MI-17 V5 helicopters of the Indian Air Force had been operating in Sri Lanka from 29 November, conducting around 90 sorties, rescuing approximately 270 survivors, airlifting about 50 tonnes of relief material to inaccessible areas and relief camps and deploying 57 Sri Lankan troops to cut-off locations.
Having completed their flying hours, the two helicopters returned to India on Sunday (08) for mandatory maintenance and a fresh MI-17 aircraft arrived at Katunayake Airport to continue operations alongside the SLAF.
The aviation support comes alongside major maritime assistance. The Indian naval vessel INS Gharial arrived at the Port of Trincomalee on Sunday (08) carrying a 700-tonne humanitarian shipment, marking India’s fifth naval relief consignment to Sri Lanka, apart from 10 aircrafts and 5 helicopters, which have contributed towards rescues and relief operations, since the cyclone.
The shipment included essential food supplies such as pulses, sugar and milk powder, as well as bed sheets, towels, sarees, dhotis and tarpaulins for families displaced by flooding and landslides. The emergency aid is being directed to the hardest-hit districts through local relief agencies.
In a further show of engineering support, India has also handed over a 63-ton Bailey bridge and a consignment of essential medicines to Sri Lankan authorities to restore connectivity and meet urgent medical needs in affected communities.
The cargo was received by General Chaminda Wijerathne of the Sri Lanka Army Headquarters, Sunil Jayaweera, former Director Preparedness of the Disaster Management Centre (DMC), now volunteering in the response and Shan Pathirana, Deputy Director of the DMC Awareness Division.
The handover was facilitated by the Indian High Commission in Colombo.
These coordinated air, sea and engineering initiatives underscore India’s continued commitment to supporting Sri Lanka during its national emergency response and long-term recovery. The assistance forms part of India’s broader partnership to restore essential services, reconnect isolated communities and provide relief to thousands affected by Cyclone Ditwah.
News
Relief Cargo from the UAE arrives in Sri Lanka
In a significant gesture of solidarity and support, a relief cargo from the United Arab Emirates has been officially received in Sri Lanka.
The cargo was accepted by key representatives from the Middle East Division of the Ministry of Foreign Affairs, including Ms. Ishara De Silva and Ms. Sajeeda Rasheed, both serving as Assistant Directors.
Joining them were Sunil Jayaweera, a former Director of Preparedness at the Disaster Management Center (DMC), who has returned to volunteer after retirement and . Shan Pathirana, Deputy Director of the Awareness Division at DMC.
The cargo was presented by the Deputy Head of Mission, representing the UAE, highlighting the strong ties and commitment to humanitarian aid between the two nations.
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