On 18 February 2021, the Monetary Board issued Rules in respect of repatriation of export proceeds into Sri Lanka and conversion of such proceeds into Sri Lanka rupees, and also issued Operating Instructions to Licensed Banks on the same. The above Rules and Operating Instructions, which would supplement the repatriation requirement already in place, were issued in order to strengthen the foreign exchange situation of the country and to dampen speculative activity that caused some excessive volatility in the exchange rate. Since issuing these Rules and Operating Instructions, there have been some media reports, which argued that such rules will discourage Sri Lankan exporters from expanding their domestic businesses. These reports also implied that the legitimate earnings of exporters were being usurped by the banking system and the Government.
