The Sri Lankan High Commission in Nigeria as well as its consulates in Germany and Cyprus will be closed from January 2022 over depleting foreign reserves.
Sri Lanka had foreign reserves of $1.58 billion as at the end of November, down from $7.5 billion when President Gotabaya Rajapaksa took office in 2019.
The country is also facing $26 billion foreign debt.
The closure of the three missions came on the same day the Central Bank of Sri Lanka tightened restrictions on foreign currency remittances received by locals.
It was gathered that the country announced the closure of three overseas diplomatic missions in a bid to save foreign currency reserves, as its Central Bank slaps tighter controls on dollars needed to finance essential imports.
The Ministry of Foreign Affairs said on Monday that the Sri Lankan high commission and consulates in the affected countries would be closed from January in the restructuring.
According to the ministry, “The restructuring is undertaken with a view to conserving the country’s much needed foreign reserves and minimising expenditure related to maintenance of Sri Lanka’s missions overseas.”
Ratings agency Fitch has downgraded Sri Lanka due to mounting fears of a sovereign default
In March, 2020, the government imposed a broad import ban to shore up forex reserves, triggering shortages of essential goods such as fuel and sugar.
It ordered all commercial banks to hand over a quarter of their dollar earnings to the government, up from 10 percent.
This means banks will have fewer dollars to give to private traders who are importing essential goods.
The Central Bank has appealed for foreign currency, even the loose change of people returning from overseas trips.
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