Costly renegotiation
by Gagani Weerakoon-Saturday, 12 Oct 2013
Central Bank Governor Ajith Nivard Cabraal, who has issued a currency note in the Rs. 5,000 denomination, is planning these days to print a Rs. 10,000 note as well, CB sources say.
A team of officials of the bank are currently in England to discuss and hand over an order to renowned bank note printer De La Rue for the printing of the Rs. 10,000 currency note, which will soon be circulated in Sri Lanka.
The currency note with the highest denomination presently in circulation is the 10,000 Singaporean dollar note. Only a limited number of this currency note is being printed and their numbers have been made available to all global financial institutions involved in currency exchange.
If a Rs. 10,000 currency note is printed and circulated without proper planning, currency experts warn, the financial market could experience serious repercussions. However, the CB governor wants to go further and see that a Rs. 100,000 currency note is issued during his term of office, added the CB sources.
by Gagani Weerakoon-Saturday, 12 Oct 2013
The United National Party (UNP) yesterday questioned why the government had renegotiated with the Chinese Exim Bank, to increase the rate of interest from 1.3% to 6.3%, an increase of 5%, on the loan of US$ 306.7 million, which it had obtained to construct the Magampura Mahinda Rajapaksa International Harbour, Hambantota. UNP MP Dr. Harsha de Silva, raising an oral question in Parliament, asked the Minister of Ports and Highways, Rohitha Abeygunawardena, why such a move was made, when in practice, re-negotiations are held to reduce bank loans or interest rates, and not to pay increased rates.
On being further questioned by Parliamentarian de Silva whether he was aware about the government taking an additional loan of US$ 153 million from China for the Hambantota Port in January 2013, Minister Abeygunawradena responded, saying:
"We did not obtain a loan from China in January 2013, but we took an additional loan of US$ 147 million for the Hambantota Port Development Project at 2% interest, from Exim Bank of China. In all, we have received US$ 306.7 million from China for the harbour project. Though we had earlier decided to pay 1.3% interest, consequent to negotiations between the two parties, the government had agreed to pay 6.3% interest per annum."
MP de Silva, then questioned why such a decision was taken, to which Minister Abeygunawardane said, the responsibility lies with the Finance Ministry as it was that ministry that had negotiated the funding from the Chinese bank.
The Opposition also queried how many ships had arrived at the Hambantota Port other than those carrying vehicles, which had been directed to the Hambantota Port as ordered by the government. Minister Abeygunawadena replied that the government had not issued such a directive.
Cabraal to issue Rs. 10,000 note soon!
- Friday, 11 October 2013
Central Bank Governor Ajith Nivard Cabraal, who has issued a currency note in the Rs. 5,000 denomination, is planning these days to print a Rs. 10,000 note as well, CB sources say.A team of officials of the bank are currently in England to discuss and hand over an order to renowned bank note printer De La Rue for the printing of the Rs. 10,000 currency note, which will soon be circulated in Sri Lanka.
The currency note with the highest denomination presently in circulation is the 10,000 Singaporean dollar note. Only a limited number of this currency note is being printed and their numbers have been made available to all global financial institutions involved in currency exchange.
If a Rs. 10,000 currency note is printed and circulated without proper planning, currency experts warn, the financial market could experience serious repercussions. However, the CB governor wants to go further and see that a Rs. 100,000 currency note is issued during his term of office, added the CB sources.
