TODAY NEWS - Import restrictions relaxed to boost growth

ddrperera

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GOOD NEWS TO LEADING FINANCE SECTOR COMPANIES
PLC /LFIN/CFIN

LEADING BANKS
HNB /COMB/SAMP

DanceOfBoons

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Can you share that news link?

samaritan

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There is no decision taken by the govt with regards to this, its a request made by certain business segments.
In my opinion if govt relaxes import restrictions the rupee will depreciate and interest rates will rise.

ANC will not be in agreement to this i am sure!

ddrperera

ddrperera

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samaritan wrote:There is no decision taken by the govt with regards to this, its a request made by certain business segments.
In my opinion if govt relaxes import restrictions the rupee will depreciate and interest rates will rise.

ANC will not be in agreement to this i am sure!

A top government official said the Government was aware of the need to relax the current import control regulations. He further stated that the Government has received a negative response from local industrialists as well as international organisations in this regard.
According to him, these import restrictions were not a decision taken by the Government to embarrass the people. The Government is now focusing on easing these import control regulations on a logical and scientific basis, he said.
The export economy represents only 10 per cent of Sri Lanka’s GDP. Therefore 90% of our economy is dependent on imports. The Government introduced these restrictions a few months ago to control the outflow of foreign exchange.
Meanwhile, economic experts said that the Government should take steps to ease these import restrictions at least from the end of the first quarter of next year.
They were confident that the dollar will remain in the 186-191 rupee range this year due to the current import restrictions in place but warned that the rupee could depreciate to Rs 195-210 range by the June quarter next year on the basis of easing these import restrictions.
“We have only a government financing issue. Therefore, the entire economy should not be affected by unnecessary controls, the Government should take immediate action to relax the import control regulations to accelerate growth,” economists told Ceylon FT a few weeks ago.
They say that if import restrictions continue the country’s Small and Medium Enterprises (SMEs) will face a severe crisis and that the government should pay immediate attention to this issue.
They say the prevailing market interest rates have fallen to a record low and there is a possibility of an increase in the face of a possible easing of import regulations in the future.
Import duties are also a key component of Government revenue.
These import restrictions are also a violation of Article VIII of the International Monetary Fund (IMF) signed by the government.
Recently, the European Union (EU) also addressed this issue.
EU First Councilor, Head of Political, Trade and Communications Section Thorsten Bargfrede pointed out that the move to restrict imports was not the ideal avenue, especially since the island nation aspires to become a regional trading hub. “We feel that closing borders at this point is not an advantage for Sri Lanka, as it looks to become a regional trading hub,” said Bargfrede.
He stressed that imposing tariffs on certain industries to protect domestic industries is not helping their long-term competitiveness, as without feeling market pressure their productivity tends to contract.
Stating that a regional trading hub is one that allows goods to come in and out, Bargfrede said the EU believes that the current import restriction might work well for Sri Lanka in the short term, as there is a need to protect the currency. However, in the long term, the decision would lead to negative effects. “Over time, it can reduce the attractiveness to European investors and lead to uncertainty and changing regimes is now what investors look for,” he said.
Meanwhile, Minister of Industries Wimal Weerawansa has pledged to provide a speedy solution within the next few days to local industrialists who were victimised due to import restrictions without the accessibility of imported
Raw materials.
Minister Weerawansa, and State Minister of Finance and Capital Markets and Public Enterprise Reforms Ajith Nivard Cabraal, were present at several rounds of discussions last week in this regard.
The purpose of these discussions was to rationally consider the impact of the temporary import ban on certain goods and on local industrialists.
The discussions focused on listing items where import restrictions should be immediately lifted as they cannot be manufactured locally, items that should be temporarily lifted until they are produced locally, and items that should not be imported at all.
These lists are to be prepared by a committee consisting of Secretaries to relevant Government Ministries and Heads of Customs, Board of Investment of Sri Lanka (BoI) and the Industrial Development Board.
In such a scenario the Government is considering the possibility of tightening its foreign reserves from various sources while easing import restrictions accordingly.

heroxhere

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samaritan wrote:There is no decision taken by the govt with regards to this, its a request made by certain business segments.
In my opinion if govt relaxes import restrictions the rupee will depreciate and interest rates will rise.

ANC will not be in agreement to this i am sure!

Agreed.

"The discussions focused on listing items where

import restrictions should be immediately lifted as they cannot be manufactured locally,
items that should be temporarily lifted until they are produced locally,
and items that should not be imported at all.

These lists are to be prepared by a committee consisting of Secretaries to relevant Government Ministries and Heads of Customs, Board of Investment of Sri Lanka (BoI) and the Industrial Development Board."

So they're only focussed on relaxing imports on items that aren't and cannot be manufactured locally. Also, they wouldn't want the rupee to depreciate to Rs 195-210 range as stated.

So our local companies involved in manufacturing these items should and will continuously benefit.

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TODAY NEWS - Import restrictions relaxed to boost growth

1 TODAY NEWS - Import restrictions relaxed to boost growth Sat Nov 07, 2020 11:03 am

ddrperera

2 Re: TODAY NEWS - Import restrictions relaxed to boost growth Sat Nov 07, 2020 11:18 am

DanceOfBoons

3 Re: TODAY NEWS - Import restrictions relaxed to boost growth Sat Nov 07, 2020 11:40 am

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4 Re: TODAY NEWS - Import restrictions relaxed to boost growth Sat Nov 07, 2020 12:11 pm

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5 Re: TODAY NEWS - Import restrictions relaxed to boost growth Sat Nov 07, 2020 12:25 pm

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6 Re: TODAY NEWS - Import restrictions relaxed to boost growth

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