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Sri Lanka workers returning to South Korea as Coronavirus drive remittances down

LIVING CAREFULLY: A child looks out from the sun roof of a car during a drive-in concert in a parking lot in Goyang, Korea.

ECONOMYNEXT – Sri Lankan expats working in Korea have started to go back with the first batch of 160 workers leaving in a special flight from Mattala Airport and more are awaiting clearance to go, officials said as the island’s foreign remittance fell amid a Coronavirus crisis.

“We are making plans to send back more Sri Lankan expats to Korea but we are waiting for confirmation from Korea,” Mangala Randeniya, Director General of Sri Lanka Bureau of Foreign Employment said.

“We have more people to go”.

The first batch of Sri Lankans are leaving on a Myanmar International Airline flight co-ordinated by Paradise Travels Nugegoda.

Officials said more flights are planned.

About 20,000 Sri Lankans are in Korea with about 900 in Daegu a city that had a large cluster of Coronavirus patients.

Korea has been actively contact tracing and isolating Coronavirus patients to keep down the pandemic.

Koreas embassy in Colombo has said those with (D2/D4 visa) visa for students or E9 visa for worker/or trainees will have to go through a two week pay a fee of 100,000 Korean won (which is about 15,915.33 Sri Lankan Rupees per day) for 14 days.

Many Sri Lankans work abroad and send remittances home.

With Coronavirus spreading in the Middle East, and oil prices hit and banking activity also disrupted in Sri Lanka amid curfews remittances fell 9 percent to 375 million US dollars in April 2020 from a year earlier.

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Sri Lanka’s central bank prints money forcing the rupee to collapse, destroying capital that can be invested to create jobs and driving workers to countries with stronger exchange rates which grow fast and face labour shortages.

Sri Lanka was also a net importer of labor for many decades especially into tea plantations under a before the central bank which can print money and cause forex shortages was set up in 1951 leading to economic decline.

Korea used to export labour when the Bank of Korea was depreciating the currency like in Sri Lanka’s central bank.

From 2015 to 2020 Sri Lanka rupee has fallen from 131 to 188 to the US dollar, causing consumption and output shocks.

In the 1970s when Bank of Korea was struggling to reform itself and have monetary stability Korea also exported labour to the Middle East.
The Won fell from 310 to 622 in the decade from 1970 to 1980. From 1960 to 1970 the Won fell from 63 to 310 to the US dollar.

Bank of Korea went through several round of reforms and the reforms in the early 1980s brought results ending strikes and setting the country on a growth path.

Korea is now a net importer of labour and due to liberal reforms it has become OECD level country. (Colombo/May27/2020).