COLOMBO: In midst of the country's worst economic crisis, Sri Lanka's Colombo Stock Exchange (CSE), on Saturday has been directed to temporarily close the stock market for five days starting April 18. The Securities and Exchange Commission (CSE) of Sri Lanka made the announcement in a statement saying that it is "of the view that it would be in the best interests of investors as well as other market participants if they are afforded an opportunity to have more clarity and understanding of the economic conditions presently prevalent, in order for them to make informed investment decisions."
"Therefore, acting in terms of the provisions contained in Section 30 of the Securities and Exchange Commission Act No. 19 of 2021, the SEC has decided to direct the CSE totemporarily close the stock market for a period of five business days commencing from 18th April 2022," the statement read. The statement also said that the SEC has "evaluated the impact the present situation in the country could have on the stock market, in particular the ability to conduct an orderly and fair market for trading in securities."
It informed that many other stakeholders of the securities market including the Colombo Stock Brokers Association have also sought the temporary closure of the market on grounds of the ongoing economic crisis in the country. Sri Lanka's economy has been in a free fall since the onset of the COVID-19 pandemic, leading to the crash in the tourism sector, which was followed by a crash in the agriculture sector after the government's move to ban all chemical fertilizers in a bid to make the Island country's agriculture fully organic.
Sri Lanka is consequently facing a foreign exchange shortage, which has affected its capacity to import food and fuel, as well as resulted in the country defaulting on the entirety of its foreign debt.