SL sign agreement to ‘modernize and improve’ financial sector efficiency

SL sign agreement to ‘modernize and improve’ financial sector efficiency

SL sign agreement to ‘modernize and improve’ financial sector efficiency

Written by Lahiru Fernando

04 Oct, 2017 | 8:27 pm

Sri Lanka has entered into an agreement to modernize and improve the efficiency of the financial sector.

The World Bank issued a media release over the matter.

The release says that the agreement will be financed through a $75 million loan from the International Development Association with a maturity of 25 years that includes a grace period of five years.

What is the International Development Association? – it is the World Bank’s grant and low-interest arm.

The new Financial Sector Modernization Project (FSMP) was signed today (October 4) by;

  • Idah Pswarayi-Riddihough – World Bank Country Director for Sri Lanka and Maldives
  • R.H.S. Samarathunga – Secretary to the Treasury

The WB Country Director stated: “Sri Lankan authorities must continue effectively addressing challenges in the financial sector; such as gaps in financial sector infrastructure, weak legal frameworks, and in oversight functions of the regulators.”

This 5 year project will be implemented via the financial sector regulators

  • Central Bank of Sri Lanka
  • Securities and Exchange Commission of Sri Lanka
  • Insurance Board of Sri Lanka

Food For Thought

Programs to modernize and improve efficiency of the financial sector will be pointless if senior members of the government continue to poke their fingers into financial matters as in the case of the bond scam.

How do you improve the financial sector when the Minister of Finance dictates interest rates and decisions to be taken by State banks, as reported at the Bond Commission today?

As early free-market economist and classical liberal French author Frédéric Bastiat said,

“When plunder becomes a way of life for a group of men in a society, over the course of time they create for themselves a legal system that authorizes it and a moral code that glorifies it.”

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