Career central banker P. Nandalal Weerasinghe will replace Ajith Cabraal, who has failed to stem the spiral of the economic crisis.
Through Bloomberg
Released April 5, 2022
Fr Nandalal Weerasinghe, a working central banker, has been appointed head of Sri Lanka’s Monetary Authority as the government seeks to pull the South Asian nation out of the economic downturn, avoid a bond default and begin aid talks with the International Monetary Fund.
Weerasinghe, currently deputy governor after a stint at the IMF, expects to take over as governor of Sri Lanka’s central bank on April 7, he said over the phone from Australia. He will replace Ajith Nivard Cabraal, who resigned on Monday after failing to stem a deepening economic crisis and resisting help from the multilateral lender.
“Yes, I was approached and offered the job,” Weerasinghe said of the appointment, which was confirmed by a central bank spokeswoman. “I agreed to take it,” he said.
Weerasinghe takes on the job as Asia is experiencing the fastest inflation and the rupee is the world’s worst-performing currency this year. His first task would be to review interest rates, a decision originally due Tuesday but postponed indefinitely as President Gotabaya Rajapaksa overtook his political and economic teams.
The root cause of Sri Lanka’s inflation of nearly 19% may be beyond Weerasinghe’s control. Dwindling foreign exchange reserves led to shortages of food, fuel and medicines, fueling discontent in the island nation while massive debt payments threatened. Troubles were compounded by Russia’s invasion of Ukraine, which pushed up oil prices and stifled a tourism recovery.
With a PhD in economics from the Australian National University, Weerasinghe previously served as an alternative executive director at the IMF and as the central bank’s chief economist until 2011, according to the agency’s website. He was Chairman of the Monetary Policy Committee and the Foreign Reserve Management Committee of the CBSL.
President Rajapaksa on Monday also sworn in Ali Sabry as the new finance minister, replacing his brother Basil to lead the economy out of its worst crisis in decades. Sabry is part of a team that will oversee the country’s debt restructuring, which is key to IMF support.
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