President Gotabaya Rajapaksa has forced out independent members of the Monetary Board of Sri Lanka with over two years left in their term Colombo Telegraph learns.
Colombo Telegraph is reliably informed that two highly respected non-executive members of the Board were forced out on the instructions of Secretary to the President Dr. P.B. Jayasundera as President Gotabaya Rajapaksa seeks to consolidate control over the Central Bank and the country’s financial system.
Nihal Fonseka and Dr Dushni Weerakoon
The Secretary to the President who was formerly Treasury Secretary is already de facto managing the economy and running the Treasury, despite the Ministry of Finance being technically assigned to the Prime Minister, Mahinda Rajapaksa.
Monetary Board non-executive members Nihal Fonseka and Dr Dushni Weerakoon resigned effective May 31, 2020.
Fonseka is a former chairman of the Colombo Stock Exchange and banker, while Dr Weerakoon was the Executive Director of the Institute of Policy Studies founded by renowned Sri Lankan economist Prof. Saman Kelagama.
Nihal Fonseka who was appointed in 2016 had two years left in his term, while Dr Weerakoon was appointed as a member of the Monetary Board only in 2019. President’s Counsel Sanjiva Jayawardane was appointed to the Monetary Board after President Gotabaya Rajapaksa was elected in November 2019.
The resignations have sparked fears that the President will replace the two officials with lackeys who will return the Sri Lankan Central Bank to the infamous days of Ajith Nevaad Cabraal’s governorship. During the Mahinda Rajapaksa presidency, Cabraal’s chairmanship of the Monetary Board, the Central Bank embarked on disastrous oil hedging deals, authorized the investment of Employees Provident Fund in pump and dump schemes at the Colombo Stock Exchange and footed the bills for the Rajapaksa Government’s international PR and lobbying efforts.
The Monetary Board is the governing body of the Central Bank of Sri Lanka, the country’s financial regulator. The Board comprises two ex officio members – Governor of the Central Bank and the Secretary to the Treasury. Three non-executive members of the board are also appointed with the approval of the Constitutional Council.
The non-executive members of the Monetary Board hold office for a 6-year term, a term that exceeds that of an incumbent President or Parliament. Monetary Board members are not expected to change as regimes change. (By Janakie Mediwake)
Mallaiyuran / June 2, 2020
Why is he rushing so fast? If he gets(so far Colombo media is confident on that) 2/3 Constitutional Council is going home. Then he can do any thing he wants with any of the independent Councils. If anything goes wrong here, it may reduce his hope for 2/3. Is this because CB is not manageable even worse, unlike the time Ravi took over?
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Dr. Gnana Sankaralingam / June 2, 2020
Did you hear that the five member bench headed by chief justice has dismissed all cases filed against the move to hold elections on 20th June. CJ has said that after president made the order to dissolve parliament and hold elections, there is no provision in the constitution for president to amend or recall the order. He also said that president cannot interfere in any decision by elections commission to change the date of elections. Refer to my comments on 30th May in article written by Prof. David. I said constitution does not say that if elections cannot be held due to some reasons and if new parliament cannot be installed within the stipulated time, that president should recall gazette notification of dissolution and reinstate old parliament until elections could be held. I further stated that this loophole will allow president to carry on without a parliament till election is held, and supreme court will have to go along with that and dismiss cases filed. This is exactly what has happened, which legal luminaries did not foresee. This does not mean that there is no constitutional crisis. Best thing is to file action to dismiss caretaker government, which has no authority to function after 2nd June, which will be upheld by supreme court.
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S. C. Pasqual / June 2, 2020
Law of the country – Prevailed.
Constitution of the country – Prevailed.
Democracy – Prevailed.
Will of the people – Prevailed.
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Honer the law of the land.
Respect The People’s Mandate.
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leelagemalli / June 2, 2020
Southerner #s Thondaman would never allow his brother to do the job. That is not overlooked. Bp is bp, they would never learn it right. Srilanka is caught by Rajapakshe palhoru.. as is the case some pirates work on the slope of Somalia.
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Now with the BEACH in ML is eroding, BPs stay as if they swallowed CLAY. They point the finger at previous govt, but the current men are 100000000000000000000000000 times corrupted and incapable. Gota should go back to the US and continue his petrol shed assistant job, not letting himself dead in his 4-Walls (Janapathi Karyaalaya). Bp cant face the press today… that is the truth, basta.
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Kuviyam / June 2, 2020
GOTA is laying the foundation for another CB Bond scam. Concentration og powe in one hand amounts to dictatorship
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Dr. Gnana Sankaralingam / June 2, 2020
Chief architects of CB bond scams –
Mahinda’s regime —- Nivard Cabraal
Ranil’s regime —- Arjuna Mahendran
Gota’s regime —- ??? PB Jayasundera
Strangely similar situation of power struggle between Sirisena and Ranil during last regime, is developing between Gota and Mahinda, which will come out after elections. Like Sirisena who did not have a voter base revolted when told that he will have to give way for Ranil, when Gota who also does not have a voter base, realizes that he is only one term president, and has to give way for Namal, he will start revolting. This split among family members, is the only salvation for the country.
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leelagemalli / June 2, 2020
PB should be a prisoner as of now :But a country like no other not having the respect to the law and order, it is shortly before sinking. How can these men ever face the loads of problems before them ? By July, the country should have to pay over 5 BILLIONS of US dollars. All these were made aware by previous GOVT, even if that was painted further in favour of BPs and their come back.
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Muhandiram / June 3, 2020
Agreed that there will be bad blood between the brothers after the election with All the brothers joining with the PM brother and the President totally isolated in the family. The trouble will begin with the PM brother beginning to exercise his Constitutional Powers. He will start by dismissing most or all the Military guys who are holding top positions now and replace them with his cronies.
Is it not a good idea to have early election to watch the fun?
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Atu / June 2, 2020
“Monetary Board members are not expected to change as regimes change.”This sums up the message. My message is “expect the unexpected”. I have no doubt Mr. Nihal Fonseka and Dr Dushni Weerakoon are high quality professionals. However, what matters is their line of professional thinking in terms of the strategic thinking of the Government of the day. So, it is fair a Government wants professionals who implement Government strategies. The President has the power to request a change. I think it is better for both of them professionally as well to let the Government to select own people. There is no professional damage for them as they are high calibre professionals. Whether the replacements are good or bad will be decided by the outcomes. It is too early to make that judgement. It is good the GR calls the shots rather than MR. That means GR takes responsibility of the outcomes.
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Good Sense / June 2, 2020
If I have any sense I should not be guided by appearances but guided on facts. We know for certain that the CB is the place where the Bond Scam took place and there is all the mire possibility that many a scam took place before despite all the “Independent Members” there can be in the Monetary Board. It is true that the Government of the day appoints and replaces members of all kinds of boards unless the position is guaranteed by some stability. The “Yahapalana” Government which mustered the 19th amendment did not fit to think making the Monetary Board “Independent”. Why? Nobody will touch that and the government of the day will want under its control. The real issue is not the so called “Independence” but the so called “cleanliness” that matters.
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Walter Bagehot / June 2, 2020
Good sense
Seems you have taken leave of your good senses in typing this comment. Please read the monetary law act (MLA) that is the foundation of the CBSL and the amendments made during the period of Indrajit Coomaraswamy that any casual chat with an unbiased officer at the CBSL would show you brought the much needed independence that was lacking during both Cabraal and Bond Mahendran’s time.
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Good Sense / June 3, 2020
Walter Bagehot
With all the provisions of the monetary law the great bank robbery took place (Bond Scam). If Independence of the monetary board was vital then why not let its members be screened or appointed by the Constitutional Council and that did not strangely come into focus of the creators of the 19th amendment. A Law can be tinkered with by a government having a parliamentary majority which can easily happen whereas a constitutional amendment is more difficult. I repeat, more than the Independence the honesty and integrity of the appointee will ensure a better quality than the so called Independent and crooked individuals who will feather their own nests to the hilt using such independence.
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Walter Bagehot / June 3, 2020
Good Sense aka Non Sense
What are you talking about?
Refer MLA Part II 8-2 that states in black and white ‘The Monetary Board shall consist of’ –
c) ‘three members appointed by the President on the recommendation of the Minister of Finance, with the concurrence of the Constitutional Council’.
https://www.cbsl.gov.lk/sites/default/files/cbslweb_documents/laws/acts/en/monetary_law_act.pdf
So, this provision has been there from at least far back as 2002 per the MLA and the criteria was applied from that time. The usual tenure is 6 years and I think most members got a second term so there have been very few changes over the past 15 years or so. I doubt the board had much power during Cabraals time as was already highlighted by the many documents made public in the last year or two.
Bottom line is what you are talking about is already the case. If you don’t know what you are talking about, it is better not to talk at all.
Meanwhile, check and let us know what happened to the Central Bank Act that was announced last year as supposed to replace MLA with global standard provisions and a new level of independence. As far as I know, Mangala Samaraweera dragged his feet on the matter and then got the boot after the last election so I guess that is dead in the water.
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Good Sense / June 4, 2020
You are concurring with what I said. Thank you. It is the monetary law amended in 2002. But that can be changed with a simple Parliamentary majority. I repeat my question. Why was not this entrenched into the Constitution when they introduced the 19th amendment? There a lot of laws like the monetary law. Despite that they entrenched the already existing legal provision into the 19th amendment. When we talk of “Independence” it is the freedom to do a proper professional job and not “Independence” to rob with impunity.
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Native Vedda / June 2, 2020
Good Sense
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The state institution/enterprises are of the crooks, by the crooks, and for the crooks, Being Sinhala/Buddhists is their defense and impunity is automatically invoked, no one else has the rights or power to challenge these crooks either they are in or out of power.
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The state functionaries whose responsibility is to protect properties of the state practice cool policies such as see no evil; hear no evil, speak no evil, and wherever needed facilitate and share the loot.
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Good Sense / June 3, 2020
Sharing the loot! Of Course! As a matter of policy I do not refer or allude to ethnicities of persons though the Governor of the Central Bank who carried out the scam does npt fit into the ethno-religious description you describe.
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Helios / June 2, 2020
Howe, Howe. CT. Slam the breaks please before you go too far with this story.
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To correct a few factual errors first, the reference to Saman Kelegama. He was never a Professor. He did have a Masters from the Indian Institute of Technology (IIT), and D.Phil. (1990)from Oxford But he was not a professor anywhere. He was genuine unlike some fake Cornell, Harvard graduates who flood this website with their bullshit ‘comments’ no one reads, under a million bogus identities.
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The reasoning behind the decision for resignation lies in the para, “Fonseka is a former chairman of the Colombo Stock Exchange and banker, while Dr Weerakoon was the Executive Director of the Institute of Policy Studies”.
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You probably haven’t had access to the loads of material relating to ‘conflicts of interest ‘ of these two individuals and your story is probably based on their (and their associated party) complaints.
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It is likely that Mr Jayasundera will issue a statement on behalf of the government in the near future and you can presume, all will be revealed.
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Native Vedda / June 2, 2020
Helios
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No wonder why Nihal Fonseka and Dr Dushni Weerakoon have resigned, since November 2019 they would have found it difficult to work for the Ministry of Finance which came under the control of crooks, thief in chief and a madman who believes he is a strongman.
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Walter Bagehot / June 2, 2020
Helitosis
Hope this Jayasundara (who destroyed the economy from around 2007-2014) will also list out the conflicts of interest of Sanjeeva Jayawardena who was a paid schill to appear for the wrong side during the constitutional coup of 2018, as well as list out what his achievements are in the sphere of finance and monetary policy to be qualified to hold such a role. If it was his brother late respected Supreme Court Justice Prassanna it would be a different matter altogether.
Will Jayasundara also be commenting on his own conflicts of interest in holding a public position of trust, namely in awarding huge contracts to SAGT without due process and eventually getting landed by the Supreme Court?
And who the hell cares whether Saman was a Doctor or a Professor? Is this even relevant?
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GATAM / June 2, 2020
In a way good to jump out of the sinking ship. SL’s economy is free falling. The highly corrupt President, Crime Minister and the Head of various Presidential Task Forces (all have the same mother) will be supplemented by equally corrupt PBJ, Cabraal and Weeratunga. With 200 rupees to the dollar, they have to work harder to amass enough dollars. After his term ends in 2024 Gota will run back to USA. His wife is a US citizen so they can get back to USA and avoid legal issues in SL. Their henchmen will also try to escape.
It is a foregone conclusion that Gota is a one time president. By the time he leave office, SL will be in tatters and burning with racism as 2014.
Hope the Supreme Court will do some justice by the nation today.
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Ajay / June 2, 2020
Something smells fishy in the special bonding between this Jayasundera dude and the Rajapaksas. It looks more like a friendship with benefits than a strictly professional relationship. There are other special characters like this in the GORA-MARA-BARA administration. These are the point men in the judiciary, police, armed forces, intelligence, and other key government institutions who with their accomplices in the gutter media, the Sangha, and the criminal underworld run the country like Rajapaksas’ private property. This is just the beginning. From 2005 up to this point it has been the foundational phase. The real thing is starting only now. It will end one day of course, but it is far far away in the distant future. So everyone just relax.
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Easton Scott / June 2, 2020
Heigh ho and away we go…… is there no limit to this unbridled centralisation of power to rob the country dry by the Rajapaksa Brothers Inc.?
Wasn’t this unholy chap P.B Jayasundera found guilty in 2008 by the Supreme Court of Sri Lanka of a violation of procedure in the awarding of a large contract for the expansion of the Port of Colombo and barred from holding any public office thereafter?
Who let this dog out?
Just asking.
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leelagemalli / June 2, 2020
Hope not Gotabaya will appoint any army officer to these posts. Gotabaya has proved to be no different to SIRISENA number 02; and all the fairy tales rained about his profile are just fictions for them to grabbing power by any means.
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We know from his MR’s Presidency how they then sacked CJ Dr SB wihtin 24 h not going by any kind legal provisions but because BPs thought, if anyone would stand against, he or she has nothing to do with them, but to go. If this was the case in any other commonwealth countries, MR and the like men would have been driven away from active politics, but this country filled with STUPID people as NOWHERE else, would never learn it… I am very pessimistic about the future SL but very optimistic, that ours will be land far behind SUDAN or MALAWI sooner than later. At least then, our STUPID people will get to know what it means to be able to vote for educated leaders.
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Likewise, the current situation in the country was expected at least by 50% of the nation, that stood against Rajapakshe criminals by every means.
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S. C. Pasqual / June 2, 2020
Mr. leela ge …..
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It’s ok.
You can proceed with same medicine.
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By the way….
Have you seen Hool the Bull around..??
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Didn’t see him in courts today………
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leelagemalli / June 2, 2020
Mrs SCP,
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what is your problem ?
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Are you suffering from real incontinence ? I dont think Prof. Hoole would not give up as you the kind of low lives ? We should be really glad the kind of real SRILANKENs doing the job for the nation. We fought a war for 3 decades and today it is an another war against Rascals led by Rajakashe BPs. MaRa is no different to that Thondaman by every means. Making big statements, but did nothing much apart from the leadership given to War in its last phase. For all that, bps have been enjoying the TAX PAYERs funds without shame. Are there any reports that bps have ever spent for the destitutes.
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kautilya / June 2, 2020
PBJ form my area even his uncle is head priest of our village temple there is a malicious campaign aganist him in the media at present nobody can handle the economy other than Jayasundara.
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rj1952 / June 2, 2020
sad sorry Lanka within the next month or two will become the biggest loser nation on the planet.
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first 6.9 million rambutans voted for a USA citizen blindly after falling for bogus tales of fear-mongering by the amude wearing Buddhist rogue or crook monks and the Rajapuk led SLPP.
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now they are non-plussed with the coronavirus pandemic.
they just do not know as to what on earth they have to do and are dependent on the whims and fancies of a travelling ban imposed on him and his immediate family army war criminal commander whose track record is hiding from the Tamil tigers but after the conclusion of the war came out in the open and was instrumentally responsible for the killing of hundreds of thousands of innocent Tamil peasant poor folks.
now thanks to this cowardly heroic deeds his wife and daughters can obtain a visa or two to travel to any self-respecting country on the planet.
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the rajapukithani’s are afraid of dealing with the educated honest Lankan members who hold higher qualifications than all of them put together.
they only desire their fellow boru hora uncouth friends and associates to control the destiny of this sad sorry shitty country which had been driven drown the pallan by the many SLFP and now the SLPP governments.
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Lasantha Pethiyagoda / June 2, 2020
In autocratic governance (and indeed in tyrannies) loyalty trumps merit. That is the only explanation for these shenanigans..
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Sugandh / June 2, 2020
Mr. Pethiyagoda:
That is subsequent to the oppressive nature of authoritarian approach. Autocratic leaders, more often than not, suffer an enormous amount of insecurities and paranoia trying to keep their autocracy afloat.
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kautilya / June 2, 2020
Agree with Helios Saman Kelegama was not a professor he was one of the most respected economists in south asia he could have done more to the country but unfortuanately we lost him prematurely.
He had been in boards of several government entities as well head of private sector companies.
He led a simple life as his distinguished father late Deshamanya Dr. Jayantha Kelegama never left behind a pebble of corruption.
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Bernard / June 2, 2020
Vinod I don’t see such a huge issue here for you and halitosis to come in firing with all cylinders just to say that SK is not a Professor. He has not been disrespected in this article. However I think he is referred to as Dr. Saman Kelegama elsewhere. Whats the big deal? Beware of greeks like halitosis and their gift horses. But I know you are a decent guy. And of course I know you hate ranil and the unp but dont let that shake the foundations of your balance of head and heart.
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Walter Bagehot / June 2, 2020
Too bad the son PBJ left behind an ocean of corruption that was even declared by the Supreme Court in his dealings with the SAGT terminal. Is your memory so short?
Who gives a damned whether late respected Saman was a Dr or a Professor? He had a far better brain than the arrogant PBJ that’s for sure.
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srikrish / June 2, 2020
The Monetary Board was not brought under the independent commissions.
The Constitutional Council has no role to play in the appointment of the members of Monetary board.
Neither 17th nor the 19th amendment.brought the monetary Board under the independent commissions.
Was it a lapse?.it is a mystery why it was so?
. None of the legislators ever thought of bringing them.
It was not that he other commissions are really independent.
When the President appoints he is solely responsible whereas when the constitutional council heavily loaded with government nominees makes their recommendation,none is responsible.
The constitutional council merely becomes a rubber stamp.
Which is desirable?
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Walter Bagehot / June 3, 2020
SriKrish
Refer my response to Goodsense above.
Refer MLA Part II 8-2 that states in black and white ‘The Monetary Board shall consist of’ –
c) ‘three members appointed by the President on the recommendation of the Minister of Finance, with the concurrence of the Constitutional Council’.
https://www.cbsl.gov.lk/sites/default/files/cbslweb_documents/laws/acts/en/monetary_law_act.pdf
So, this provision has been there from at least far back as 2002 per the MLA and the criteria was applied from that time. The usual tenure is 6 years and I think most members got a second term so there have been very few changes over the past 15 years or so. I doubt the board had much power during Cabraals time as was already highlighted by the many documents made public in the last year or two.
What you are talking about is already the case.
If you don’t know what you are talking about, it is better not to talk at all.
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Nimal / June 2, 2020
” Institute of Policy Studies founded by renowned Sri Lankan economist Prof. Saman Kelagama.”.
This is not correct. He was not the founder and even not the first Executive Director.
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Mallaiyuran / June 2, 2020
CT what is the story behind The Court dismissing all 7 cases on Parliament recalling?
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Dr. Gnana Sankaralingam / June 2, 2020
Read my comment under your first comment for this article. I predicted on 30th May in the article by Prof. David, that supreme court will interpret the constitution as explained by me and will have no option other than to dismiss those cases, and it has been upheld. What happened to the so called legal eagles like Sumanthiran who failed to spot the loop hole in the constitution, which a layman like me was able to do. Unfortunately top brains become Doctors and Engineers and only mediocre fellows end up as lawyers.
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Atu / June 2, 2020
Now you guys must take a break from bashing GR and MR as Supreme Court rejected all petitions against Parliament dissolution and Election day postponement by Election Commission. As I mentioned in another post, when you lose, do not blame the referee. Just be humble and accept the verdict. As others, GR and MR would make mistakes. Highlight those with good faith and correct them for the nation, not to plot to chase them away. Respect people’s verdict.
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Muhandiram / June 2, 2020
“Hope not Gotabaya will appoint any army officer to these posts.”
Don’t be surprised. If a Military man can be the Secretary to the Health Ministry, why cannot 2 Military guys be on the Monetary Board?
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