Sri Lanka Central Bank Governor, Weligamage Don Lakshman, on Friday announced that he will step down by September 14.
Gatekeepers News reports that Lakshman’s announcement comes at a time the nation faces a deepening forex crisis that threatens its ability to import goods and service debt amid the lockdown which it extended to curb COVID-19 spread. Sri Lanka’s forex reserves fell to $2.8 billion in July, reducing import cover to less than two months.
“I have not taken any decisions against my conscience,” Lakshman said, adding that he had originally planned to retire when he turned 80 next month. “There is a political economic ideology which I believe in and continue to believe in being correct,” he said, without elaborating.
Lakshman said the pandemic has created an “extraordinary period of disruption” to the economy and the central bank “had to come in with resources to look after the people.”
An “excessive money supply”, which the bank tried to address last month with a surprise rate hike, “can be easily reduced with the budget being attended to and careful fiscal consolidation.”
Lakshman who said he was offered a role at the IMF but turned it down, advised the government to seek help from the IMF.
Gatekeepers News reports that there are Lakshman’s replacement has not been announced but there are speculations that President Gotabaya Rajapaksa may reappoint former central bank Governor Ajith Nivard Cabraal.
