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.
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)