Sri Lanka is discussing with India a cross border deferred payment due to India under the Asian Clearing Union, a regional arrangement set up by money printing central banks after the collapse of the Bretton Woods system.
Sri Lanka s imports have soared to 21.6 billion US dollars in 2021, a four year high, amid what is characterized in the popular media as foreign exchange shortages , the highest since the money printing year of 2018, according to provisional data in the public domain.
Sri Lanka s central bank is aware that its net foreign assets are negative and is working to reverse the situation, officials said, as the note-issue bank got deeper into debt with money printed to keep rates down or pay state worker salaries.
Sri Lanka s central bank said there appeared to be no significant volumes of sovereign bonds due in 2022 for sale by holders to start a buy-back program, though there were quotes at steeply discounted prices reported on trading systems.