Common chambers worry about impact of currency shortage

In a joint statement, the major chambers of commerce drew the government’s attention to the difficulties faced by their member companies and the private sector as a whole in obtaining foreign exchange to finance much-needed imports due to the current situation in this country. which concerns the lack of availability of foreign currency. currency.

Extracts from the declaration:

“The lack of availability of foreign currencies will affect maintaining the credibility of doing business with our suppliers and business partners with whom we do business in foreign currencies. At present, we are facing the difficulties of obtaining foreign exchange to finance the imports which we badly need due to the current situation regarding the lack of availability of foreign exchange.

“This ranges from the inability to obtain letters of credit to the inability to clear goods that have already arrived at the port due to delays in complying with letters of credit. This impact is also felt by indirect exporters and companies providing export support services. We are concerned that while the importers themselves face immense financial costs in the form of demurrage and other logistics-related costs, this will also affect long-established relationships with suppliers, resulting in loss. of serious and irreversible trust.

“Importers are also unable to secure orders due to the inability to agree on a firm payment schedule as required by suppliers. This will seriously hamper the availability of essentials, especially during the upcoming holiday season when consumer demand is generally high for most products. This can cause great hardship to the general public and lead to a significant increase in the cost of living.

“The banking system will also face difficulties from not being able to meet the needs of its long-standing customers and could potentially suffer a serious loss of reputation if they are forced to dishonor the payments incurred.

“The government will also suffer a loss of revenue due to lower import tariffs at a time when increasing government revenue is of paramount importance.

“While appreciating the efforts of the government to mobilize short-term financing from a number of sources through swaps and lines of credit, we urge the government to finalize negotiations on some of these agreements and to announce them with certainty as soon as possible. with a clear indication when such facilities will be available.

“If these actions envisaged by the road map recently announced by the Central Bank of Sri Lanka do not materialize on schedule, we urge the government to reconsider other alternative action plans available to the country, such as s ” engage with the IMF to explore the financing options they can offer.

“If these essential conditions for ease of doing business do not improve, we fear that many local companies will seek to relocate their business activities abroad. It will also seriously limit our ability to attract foreign direct investment (FDI) into the country.

“Therefore, we would like to urge the relevant government authorities to take prompt corrective action to avoid the negative consequences described above and put Sri Lanka back on track to build a strong post-pandemic recovery to achieve future prospects. prosperity and splendor as expected, ”the statement further noted. The declaration has been signed by the following institutions: CCC, FCCISL, CNCI, COYLE, ICC Sri Lanka, NCC, NCE, CCI and WCIC.

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