Home Market New Central Bank bill ready for publication

New Central Bank bill ready for publication

  • 20 Feb 2023
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A new draft central bank bill which has received the sanction of the Attorney General has been approved by the cabinet of ministers and now it is ready for publication in the government gazette.



The cabinet at its last sitting approved the proposal presented by the President in his capacity as the Minister of Finance to publish the bill in the government gazette and to submit it for parliamentary approval subsequently.



The new law is expected to give the Central Bank a greater degree of independence and it is one of the pre-conditions for the proposed bailout package from the IMF.



Historically similar laws have been drafted several times under the leadership of Ranil Wickremesinghe, but each time they were aborted by the subsequent governments.



The two types of independence enjoyed by a central bank are supposed to be budget independence and policy independence.



The Central Bank of Sri Lanka presently enjoys the budget independence while its powers with regard to policy independence need to be strengthened and the new law will address this issue.



Central Bank needs more independence to protect the money held in the hands of people. A central bank is expected to supply liquidity to people by issuing legal tender money and also maintain its value over time.

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