The Hon. Ravi Karunanayake

¶ 01 Hon. Speaker, I request an urgent Government statement regarding Sri Lanka’s Gross Official Reserves (GOR)—their integrity, composition and usability—foreign exchange outflows through foreign credit cards and payment gateways, and consistency of regulatory actions under the Foreign Exchange Act, No. 12 of 2017. The Central Bank has issued a Circular under this Act.

¶ 02 Reserves’ credibility must be based not only on numbers, but also transparency, usability and regulatory consistency. I request a full statement to this House on:

¶ 03 1. The currently reported GOR; and, net of encumbered assets, swaps and pledged funds, the usable reserves; also, annual income earned on GOR during 2023–2025. There appears to be a trend of domestic swaps; I raise this for national protection.

¶ 04 2. A detailed breakdown of GOR: (a) Gold reserves (quantity and valuation basis)—physical gold or paper/gold notes?; (b) Foreign currency assets by major currencies; (c) SDR holdings; (d) IMF reserve position; (e) Foreign swaps—principal, tenors, maturities and total cost; (f) Domestic swaps—amounts, tenors, rollover terms and costs. I ask on purchase/sale prices because hot money may be used to portray inflated reserves.

¶ 05 3. What portion of reported reserves is encumbered, swap-based, or otherwise unusable for debt service and stabilization?

¶ 06 4. What rupee margin/fees does the Central Bank apply when buying/selling to the Government, and profits earned from such transactions in each of the past three years?

¶ 07 5. Whether the Auditor General conducts continuous and forensic audits on the Central Bank; if so, tabling the latest audit report, scope, sample sizes, and verification details on swaps and gold.

¶ 08 6. The rationale for the latest foreign exchange circular on domestic institutions.

¶ 09 7. Whether the Central Bank has quantified foreign exchange and tax revenue leakage via credit card payments routed through foreign payment gateways. There is a loss of about USD 3 billion.

¶ 10 8. Why a binding circular is not issued against non-compliant businesses using foreign gateways to remit foreign exchange out of the country, while strictly regulating domestic institutions?

¶ 11 I seek full clarification.