The ban on open account system has been conditionally lifted for two months with traders being allowed to import selected essential food items. An open account is an arrangement between a business and a customer, where the customer can buy goods and services on a deferred payment basis. The decision was taken after traders met [...]

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Ban on OA system lifted for two months

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The ban on open account system has been conditionally lifted for two months with traders being allowed to import selected essential food items.

An open account is an arrangement between a business and a customer, where the customer can buy goods and services on a deferred payment basis.

The decision was taken after traders met Prime Minister Ranil Wickremesinghe on Thursday for discussions relating to the policy which caused controversy and outcry from importers last month.

The Prime Minister met the Central Bank Governor and other officials yesterday to finalise the change in policy.

Among the items which will be allowed to be imported via the open account system are Kekulu, Nadu and Samba, wheat flour, sugar, red whole lentils, yellow whole lentils, yellow red peas, dried chilies, dried sprats, chickpeas, coriander seeds, cumin seeds, fennel seeds, methi Seeds and mustard seeds.

Traders said the shortage of dollars resulting in the inability to open Letters of Credit left importers with no choice but to use the open account system. They warned a ban on the system would result in severe shortages.

The temporary ban and penalties on open accounts that did come into place as of June 6 have already resulted in high prices and shortages of staples like dhal, potato, onions and sprats, officials said.

Apart from the lifting of the ban, an additional 100 Mn USD will also be released  to buy essential goods, in line with a request the traders made to the authorities.

Officials noted that the utilisation of the fund would be closely monitored to ensure that traders would keep prices under control as agreed.

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