Finance Minister Ranjith Siyambalapitiya has heralded a significant resurgence in Sri Lanka’s rupee, which has been grappling amidst economic adversities since 2022. The currency’s rejuvenation is credited to extended currency swaps with the Reserve Bank of India, offering a much-needed uplift amid the nation’s financial tumult.
Siyambalapitiya revealed that in the initial four months of the year, the Sri Lankan rupee had appreciated by 9.1 per cent against the US dollar, 12.7 per cent against the Euro, 10.8 per cent against the UK pound, 11.4 per cent against the Chinese Yuan, 21 per cent against the Yen, 9.5 per cent against the Indian rupee, and 14.2 per cent against the Australian dollar.
Amidst Sri Lanka’s economic downturn in the first quarter of 2022, which resulted in its inaugural sovereign default declaration, India provided assistance for importing essential goods.
The Sri Lankan rupee received a boost from the extended currency swaps by the Reserve Bank of India. Indian aid amounted to over £2.84 billion, offering a lifeline to the ailing economy until the agreement for an IMF bailout of £2.059 billion was concluded in March 2023.
Siyambalapitiya underscored Sri Lanka’s dedication to financial prudence, steering through challenging decisions for economic recuperation following the 2022 default. The nation honored debts of approximately £1.775 billion in 2022 and £1.846 billion in 2023 to multilateral creditors such as the IMF and World Bank, upholding integrity amid bilateral debt payment suspension.
“We have upheld rigorous financial discipline while making unpopular choices to facilitate economic resurgence,” Siyambalapitiya reiterated.
