Basil says he was not informed of People's Bank blacklisting

COLOMBO (News 1st); The Minister of Finance Basil Rajapaksa says that he has not been informed of the People's Bank being blacklisted by the Economic and Commercial Office of the Chinese Embassy in Sri Lanka.

He made these remarks while speaking to media after visiting the Temple of the Tooth today (30).

The Minister of Finance, speaking to media said that he visited the temple to obtain the blessings of the Sacred Tooth Relic before presenting the budget on behalf of the people of the country.

However, when inquired whether the Minister was aware of People's Bank being blacklisted by the Chinese Embassy, Minister Rajapaksa said that he has not been informed of such an event.

The People's Bank of Sri Lanka was blacklisted yesterday (29) by the Economic and Commercial Office of the Chinese Embassy in Sri Lanka for failing to make the payment according to the Letter of Credit and the contracts between two parties.

The decision has also been submitted to the Ministry of Commerce of China.

Accordingly, all Chinese enterprises were reminded to tighten risk control and avoid accepting L/C issued by the People’s Bank of Sri Lanka in international trade with Sri Lanka, said the Embassy.

Recently, the Chinese fertilizer enterprise Qingdao Seawin Biotech Group Co., Ltd requested to get the payment of L/C by People’s Bank of Sri Lanka according to the contracts.

Disregarding the contract obligation, the business rules and international trade customs, the People’s Bank of Sri Lanka defaulted the payment of L/C and caused huge losses to the Chinese enterprise, said the Chinese Embassy.

However, People’s Bank said that is it bound by an enjoining order issued by the Commercial High Courts of Sri Lanka with regard to the trade transaction in question, which precludes the bank from processing the payment.

People’s Bank also said that the temporary delay in processing the said payment pertaining to the LC is solely due to the bank’s obligation to be bound by the legal directions of the country, as a responsible corporate citizen.

It added that once the legal barriers in effect are removed, the LC payment will be effected promptly a per the usual trade practices.