Government is struggling to set up much hyped and long delayed Export Import Bank (EXIM Bank) in Sri Lanka.
The lack of necessary expertise, financial and other resources have become obstacles for the establishment of the EXIM Bank this year.
The discrepancy in the allocation of funds for this purpose by the Treasury have triggered a confusion pushing the government’s ambitious plain into pessimism, Banking experts said.
The proposal to set up the EXIM Bank, with an initial capital of Rs. 25 billion, subscribed jointly by the government and the industry was made in the 2016 budget.
It has also been proposed to allocate Rs. 50 million as seed capital being the contribution of the Government EXIM bank that will be operational from 01 April, 2016.
According to the budget proposal, it is also envisaged to list this company in the CSE.
Although this proposal was made known in 2016 budget presented in November 2015, no action has been taken to make it operational up to now.
However the very same proposal was included in the 2017 budget presented last year and a sum of Rs.10 billion would be allocated initial contribution for the establishment of the EXIM Bank.
This Bank is a government or semi-government agency which commonly provides insurance cover to exporters against losses from non-payment by the importers, as a means to promote the country’s foreign trade.
Other services offered by EXIM Bank’s may include marine insurance, post-shipment discounting of invoices, pre-shipment advances against confirmed orders, and help in finding new markets.
The government has presented a supplementary estimate in parliament recently allocating Rs.10 billion to set up the bank.(LIN)