ECONOMYNEXT – Laugfs Gas, Sri Lanka’s privately owned cooking gas company is unable to import liquid petroleum (LP) gas due to a lack of dollars in the market making it difficult for the company to open letters of credit (LCs) with its banks, the company’s chairman said on Monday (03).
“We are talking to all the banks, even Samurdhi banks, to see if they can give us dollars,” Laugfs Chairman W K Wegapitya told EconomyNext.
“Sri Lanka’s commercial banks and state-owned banks must organise dollars. It’s not just for us; it’s the same for importers of cement, milk powder and many others.”
“In the simplest terms any country should have foreign reserves to import products. Sri Lanka doesn’t print dollars; we print only rupees.”
Wegapitya told reporters earlier Monday morning that his company has the infrastructure to supply cooking gas to Sri Lanka within two weeks if the LCs could be be duly opened.
He said that the company was supplying around 40,000 to 50,000 gas cylinders per day but now it’s only able to distribute around 10,000 to 15,000 cylinders after the Consumers Affairs Authority (CAA) and Sri Lanka’s Standards Institution (SLSI) increased the requirement of quality checks for gas distributors after a spate of domestic gas cylinder explosions.
Laughs Gas controls around 20 percent of the LP gas market in Sri Lanka while the state owned Litro Gas Lanka Ltd supplies 80 percent.
Litro said yesterday that the company will take at least three weeks to supply gas to reach normal market levels due to tightened safety regulations for gas distributors.
The distribution delay has already led to a black market for LP gas. A 12.5 kg cylinder, which is officially priced at 2,750 rupees, is being sold around 4,500 rupees in some places, local media reported. (Colombo/Jan03/2022)