Sagala:"It Would Be Stormy Before Things Calm": Fuel Prices May Increase Further With US Sanctions On Iran Peaking

Prime Minister's Chief of Staff and Minister Sagala Ratnayaka warned that the fuel prices might further increase in the coming months and it would be stormy before things calm. 

"With the Iran sanctions due to peak in the coming months, we can only imagine what is in store for us with the oil price.  Some say it can reach US dollars 100 to the barrel," Ratnayaka said, addressing a gathering of multinationals operating in Sri Lanka. 

"Whilst we will stay steady with our policies and plan and implement our recovery, we will also ensure our people can endure it," the Minister also added. 

Ratnayaka said, "Take the current crisis with the US dollar appreciating against the rupee or the rupee depreciating against the US dollar, which is what our Opposition wants everybody to say.  You will have your share of problems, but you are geared to weather it.  The mechanisms will start activating.

Going to the issue of the weakening rupee – all of you understand the situation better than me.  We are not the only ones hit by it.  The dollar has even risen on the weaker Euro.  India pumped USD26 billion hoping to control it, but has now stopped and is letting it take its course.  The Indian rupee has depreciated more than our rupee.

The strengthening US economy and the revision of interest rates by the FED lead for funds to be moved from high yielding markets like ours back to the US.  But the depreciation of the rupee is less than some of the other currencies in the region.

 Whilst we will stay steady with our policies and plan and implement our recovery, we will also ensure our people can endure it.

But through this, domestic producers will have a good ride and it will also be a good time for them to strengthen.

We must also look for opportunity in the region because some will be harder hit than us.  There is always opportunity in crises."

 

To withstand we have to also push hard tourism, our low hanging fruit and secure new investment.

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