By Rathindra Kuruwaita
Central Bank Governor Dr. Nandaral Weerashinge said the government to be formed should also implement reforms in line with the IMF’s recommendations.
“The two previous governments wanted to talk to the IMF and implement some reforms. If anyone tries to get away, the country will be in more serious turmoil,” Dr. Wheelasinge said. rice field.
The governor said the next government also needs to carry out reforms and guide the country from the current economic crisis. He said it wasn’t time for the experiment.
“People also need to understand the situation in the country. The new government could not resolve the economic crisis within a month. The people know what the real situation is and what they need to do. You have to be informed. We need consensus, “he said.
Dr. Weerasinge said it would be difficult to buy enough fuel, gas and medicine given the current forex crisis.
“We need to control spending and I think we can maintain some stability. If we continue to import in this way, we will run out of money to buy fuel and other necessities, and India will give us. I hope they continue to help. A large amount of forex inflows will improve the situation, “he said.
CBSL Governor said continued current political instability would prolong the economic crisis.
“We need to stabilize the macro economy with the help of the IMF. We need to restructure our debt. We need the Minister of Finance and the Cabinet to make important decisions about these two things. We with the IMF. When I was talking, the government changed in May. Now it has changed again. The longer this continues, the longer the economic crisis will be. “
CBSL Governor said he is working to prevent hyperinflation. Inflation reached 70% in the coming months, he said, raising interest rates to curb inflation. Raising interest rates is the most powerful tool that central banks must control inflation, but reducing inflation has not been possible for central banks. Work alone.
“We can control the inflation generated by demand. Currently, inflation is also caused by soaring fuel prices, a sharp fall in the rupee, and gas and fuel shortages. These are the main shortages. That’s why. Inflation goes up to 70% as electricity bills go up. This can’t be controlled by interest rates again, “he said.
“If we fall into hyperinflation, the situation will be much more difficult, we faced due to a lack of dollars. If we fall into hyperinflation, we will not be able to continue our business. We’ve seen what happens when countries fall into hyperinflation. The turmoil and pain, “he said.
Therefore, the central bank’s main task is to stop hyperinflation. As inflation rises, he said, the most affected are primarily the poor, pensioners, and fixed-income people.
“Hyperinflation is bad for everyone, but it gets worse in the above categories. If that happens, people will be fired and there will be serious social problems,” he said. ..
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