Sri Lanka Treasury Secretary to retire after leading reform drive: President

ECONOMYNEXT – Sri Lanka’s Treasury Secretary, Mahinda Siriwardana will retire at the end of the month to become an alternative executive director of the Asian Development Bank, President Anura Kumara Dissanayake said.

He will represent seven nations at the ADB including Sri Lanka.

Siriwardene was leaving after leading reform drive in the tax system and other legislation which had helped strengthen state revenues under an International Monetary Fund program, President Dissanayake said.

He was speaking at a ceremony to encourage tax payments.

Sri Lanka is on track to boost revenues to 15 percent of GDP after the country defaulted under extreme macro-economic policy involving rate cuts and tax reductions to target potential output.

Siriwardene was leaving after leading reform drive in the tax system and other legislation which had helped strengthen state revenues under an International Monetary Fund program, he said.

Sri Lanka is determined that this will be the last t IMF program, President Dissanayake said.

Sri Lanka started to go to the IMF in the 1960s, as the central bank failed to raise interest rates in step with the US Fed unlike East Asian nations, when it started aggressive credit cycles, cutting rates claiming there was a trade of between inflation and growth.

At the time Sri Lanka had revenues of over 20 percent of gross domestic product.

In addition to so-called independent monetary policy the central bank was also printing money to re-finance rural credit.

Sri Lanka then progressively closed the economy.

John Exter who wrote the monetary law, cautioned against independent monetary policy and stimulus in general in his report saying what is done in the US cannot be done in free trading countries like Sri Lanka and limited central bank credit to 6 months.

In the 1960s, 15-year credits were given after adding a Section 88A to the original Section 88 where money printing was limited.

In the 1960s Exter also started to buy gold – especially gold eagle coins – he said in a later interview, knowing that the US dollar would collapse under macro-economic policy.

Gold was 35 dollars an ounce when the so-called ‘full employment polices’ started. Now gold is 3,200 dollars an ounce under abundant reserve regimes and a ‘single policy rate’ at reserve currency central banks. (Colombo/June02/2025)