Following on from the previous related blog entries of the past few days, I note that a further sale of a chunk of another Conglomerate, Aitken Spence was made to a foreign entity as it was another case of doing whatever was necessary to get some more exchange into the coffers in a day the Governor of the Central Bank made his usual brash statement that ‘the Rupee would bounce back shortly to previous levels.’ It actually dropped to Rs 130 to the US$ today.
The stock market is in the dumps, the government is selling the EPF funds that are managed by the Central Bank only to overseas investors who will bring in foreign currency. So they are selling these assets at rock bottom levels, and as the rupee has depreciated, they look even cheaper if you are a foreigner as you only have to put out fewer dollars to buy this stock. I do not know when it will end, and if the govt. is selling all the investments of the EPF in the stock market as that is all they can sell for dollars?
Please think of this logic. The EPF MUST be independent of the govt. as it consists of the pension funds of the private sector workers. The govt. has NO right to dispose of this in this fire sale manner as it will only affect the final amounts available to be paid out to the pensioners. This action therefore is against the people of Sri Lanka and as these workers are unable to comprehend the nuances of investment are unable to agitate for restoration of their rights that have been usurped and stolen by the Govt.
It must also be remembered that if there is a grave balance of payments crisis, I have pointed out that the rupee would drop further to the 150 level, at which time foreigners can move in and take up the stock market picking up shares cheap and in the process drive up the market to an extent. When this happens these shares would have been sold cheaply, further aiding my argument that the savings of the private sector is being squandered to help the govt. get over crisis of their own making and not by those whose money is being robbed.
My argument is that the Govt. should bring in direct investment partners to invest in Sri Lanka, and thereby attract foreign funds, by making investments attractive. Sadly this was caboshed by the Act to take over private underutilized assets, so it leaves the govt. with fewer choices, but to raid the EPF to save their bacon.
In conclusion it is obvious to the rational observer that political appointees (either Nivard Cabraal or PB Jayasundera_) MUST not determine the manner in which the EPF is managed and how they invest their funds for the benefit of the millions of Sri Lankan pensioners. It MUST be immediately handed over to professional managers even from overseas if the independent talent does not exist in Sri Lanka so that the working people of this country are not hostage to disastrous economic policies of those in power that are merely directed at staying in power and not of developing a country with good governance and sound financial principles.