Cash-strapped Sri Lanka appeals to expats to send money-by Dr Harold Gunatillake
An interview on SBS Melbourne, Australia, by Amita Arudpragasam details the disastrous current economic situation in Sri Lanka.
The President of Sri Lanka Mr Gotabhaya at the recent Sri Lankan Independence Day celebrations in Colombo, appealed to the country’s expatriates to send money home as the country is struggling with the worst economic crisis in decades mainly due to depleted foreign reserves.
Sri Lankans are facing shortages of milk powder, cooking gas, kerosene, and other essentials. Cash shortages have hindered imports of raw materials for manufacturing and worsened inflation, which surged to 12.1% in December.
The pandemic has dealt a heavy blow to an economy that depends heavily on tourism and trade, with the government estimating a loss of $14 billion over the last two years. The economy is estimated to have contracted by 1.5% in July-September 2021, according to the central bank.
President Gotabhaya Rajapaksa said Sri Lankans abroad who sent foreign currency back home are a major resource.
“I invite all expatriate Sri Lankans to invest in their homeland, “ he said in an address during a ceremony marking Independence Day in the capital, Colombo. A colourful military parade followed his speech. This was reported by Bharatha Mallawrachi in AP news.
The President further said, “None of the crises we experience today are long term problems. We can find solutions to them with an optimistic approach,” Rajapaksa said. “We have faced critical problems in the recent history as well and found solutions.”
As Sri Lankan expatriates living abroad, the diaspora totals around 3 million.
Many expat colleagues I spoke with are reluctant to send their hard-earned savings to Sri Lanka to save as interest bearing saving accounts in the banks in the country fearing that their savings may be insecure and the government for no reason may snatch their deposits.
This fear must be offset by the government and be given a written assurance that such foreign currency deposits will be safe.
That fear is minimized by perusing the flyer published by the Central Bank of Sri Lanka that assures you that you can freely take back funds.
We must congratulate the government of Sri Lanka, in this desperate cash-trapped situation, opening a special deposit account for expats giving a reasonable interest with additional interest per annum, and assuring that the funds can be taken back freely.
So, viewers, don’t hesitate, do invest your spare currency at this moment when your resident countries give very small interest returns for your savings.
In Australia the Reserve Bank allows only a few cents on 100 dollars, while Sri Lanka gives 4% interest per annum, on the Australian dollar, and further an incentive of 2% for the first year.
For the US dollar for 12 months you earn 5.50% plus 2%. For sterling pounds 3.50% per annum plus 2%
This is guaranteed by the bank issuing a Certificate a legal document.
This account is similar to the existing NRFC accounts. It is called ‘Personal Foreign Currency Account or PFCA account.
As I said, it is a new special account that gives an interest rate of 6 percent during the first year, for the Aussie dollar- guaranteed with a printed certificate.
A colleague of my related a story through face book that a friend of his, living in Sydney, at present in Sri Lanka wanted to withdraw $ 6,000 to pay the hotels, but the bank had refused to pay in dollars from his dollar account. He was told that he could get it in rupees. So, he had to use his credit card.
It is a well-known fact the bank rules are that in no way you could visit your bank in Sri Lanka and request for dollars from your NRFC or any other foreign currency account.
The bank is permitted to transfer your dollar account to any other branch locally or to any foreign bank, according to Central Bank regulations.
A tip for those who wish to withdraw money from their dollar account would be to open a rupee account and debit to your NRFC reserves, get a debit card which can be used in any country you travel to.
All dollar accounts for expats are classified in Sri Lanka as follows:
Non-Resident Foreign Currency Accounts (NRFC), Non-resident Non-National Foreign Currency Accounts (NRNNFAs) opened and maintained have now merged and re-designed as Personal Foreign Currency Accounts (PFCAs).
I have detailed the attractive interest rates on PFCA accounts.
If you want further assurances and information, you could contact Astrid at Seylan bank, a very kind lady having all the time to discuss your financial plans. Her email address is: Astrid astridi@seylan.lk
I am in no way promoting this bank but making it easier to full- fill your dreams of opening a PFCA account. You may inquire from your own bank, if required.
Thank you for your time viewing this video talk. Stay safe and goodbye for now.
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