Sri Lanka’s renewable energy projects including wind energy ventures have become costly due economic recession and high prices of necessary components and labour as well as unavoidable expenses. Energy Ministry sources said.
Windforce PLC has flagged further cost increases in the two wind power plants it is setting up in Mannar.
In May, last year, the company informed the Colombo Stock Exchange (CSE) that the total project cost of the 10MW+5MW wind power plants would amount to Rs.6.65 billion, due to the rupee devaluation and cost increase in local material and services.
Last week, the company informed the CSE that the cost would go up further to Rs.7.45 billion, due to a toppling of a crane on the project site.
“The company wishes to inform that during the erection of the wind turbine bottom tower at location 03, Nanattan, Mannar project construction site, the hired 500T main crane toppled.
This crane is unrepairable and the company had planned to import another 750T crane on rental to continue the project. On a more positive light, no casualties were reported in the accident, due to the safety precautions in place,” a stock market filing by Windfore said.
“The damage was recorded at Rs.995 million, out of which approximately Rs.377 million will be covered by the project insurance, excluding the finance cost and other incidental cost relating to the accident.
In addition, there is also a Rs.179 million cost escalation, due to the increase of VAT and global raw material prices. Hence, the estimated cost of the project has increased from Rs.6,653million to Rs.7,450 million ,” it added.
“Consequently, the equity infusion for the project from the company’s IPO funds is to be increased to Rs.2,500 million with an expected change in the debt equity ratio from 75:25 to 65:34.
The additional IPO funds will be sourced by reallocating the funds for the Tororo Phase II Project, which is delayed, due to the on-going grid study by the Electricity Regulatory Authority (ERA) in Uganda.
This project will commence upon the completion of the grid study in July 2023 and it will be funded by the remaining IPO funds, company’s own reserves and debt financing,” it further said.
However, Windfore said as the Power Purchase Agreement (PPA) is yet to be signed, an 80 percent upward tariff rate revision is expected to the US dollar at the indicative LKR/USD rate published by the Central Bank, seven working days prior to the signing of the PPA.
As a result of the tariff revision, the project will likely earn an equity IRR of 75 percent, with a project IRR of 9.2 percent, at 1,5.6 percent WACC.
Moreover, negotiations are underway to further increase the tariff to compensate the prevailing high interest rates in the market, which will likely increase the equity IRR to 15.3 percent, with a Project IRR of 73.2 percent,” the stock market filing revealed.
Windforce’s Mannar project cost increases further due to crane toppling
US dollar drops further
According to the exchange rates issued by the commercial banks, today (08) the price of the American dollar has dropped further.
Yesterday (07) in Bank of Ceylon, the buying price and selling price of one dollar were Rs. 322.50 and Rs.337.50 and today it is Rs. 315.00 and 335.00 respectively.
In Sampath Bank, the buying and selling price of one dollar was Rs. 315 and 335; today it is recorded as Rs. 315 and Rs.330.
Yesterday, the buying and selling price of one dollar in Nations Trust Bank was Rs. 313 and 335; today it is recorded as Rs.308 and Rs.330.
Port City to break ground on CIFC Phase1 3 towers, Villa Plot and Marina Hotel in 3Q
The Port City is slated to break ground on the CIFC Phase One 3 towers, Villa plot and the Marina hotel in the third quarter.
The Duty Free complex within the Port City is set to open in May 2023 as well, Colombo Port Commission Chairman Dinesh Weerakkody said dismissing a recent article which alleged that the Port City stirs white elephant fears.
“The Portcity Colombo’s basic infrastructure is scheduled to be completed by the year end,” Weerakoddy added.
A Price waterhouse Coopers (PwC) study shows that Port City Colombo can significantly impact GDP, FDI inflows, and improve our BOP and create over half a million new jobs.
A realised master plan for the Port City provides 5.7 million square meters of built-up area valued at $ 15 billion.
Given the shifting external global environment, the challenges are obvious and they need to be managed going forward by hiring the right skills, meeting new international investment demand profiles and ensuring policy consistency.
The overall country environment will certainly play its part. Therefore economic stability is key. Playing down these challenges in favour of negative sound bites will be counterproductive and defeatist at best, Weerakkody added.
DAILY FT
IMF acknowledges President’s program to revive the country’s economy – Sagala Ratnayake
The President’s Senior Adviser on National Security and Chief of Presidential Staff Sagala Ratnayake said that the International Monetary Fund (IMF) representatives have acknowledged the effectiveness of President Ranil Wickremesinghe’s efforts to revive the country’s weakened economy. He added that the IMF is expected to respond positively regarding the release of the IMF first instalment.
Mr. Sagala Ratnayake expressed these views during a discussion held with representatives of trade unions recently at the Presidential Secretariat.
During the meeting, the measures to be taken by the union on March 8th and 9th to protest against the tax levied on earnings withdrawal were also discussed.
Mr. Sagala Ratnayake appealed to the union leaders to take into consideration the current economic situation of the country and requested their assistance in ensuring that essential services and other critical services in the country are not disrupted.
Furthermore, Mr. Ratnayake reassured the union leaders that the Government recognizes the challenges that professionals are facing due to the tax imposition and promised that the Government will review the matter and make necessary amendments in the near future. He also urged the union leaders to refrain from participating in any activities that could destabilize the country, warning that any such actions would have serious consequences for the economy of the country.
The union leaders highlighted that the high percentage of tax levied on their monthly income has made it difficult for them to manage their daily expenses and meet their bank loan instalments. They also pointed out that the recent hike in electricity tariffs has only made the situation worse. As a result, the union leaders requested the Government to reconsider the current percentage of taxation on earnings.
Also, the Union leaders pointed out that the Government could earn a large amount of tax revenue if a program was put in place to seek out the individuals who are evading taxes and capture them in the government’s tax net.
Minister of Power and Energy Minister Kanchana Wijesekera, State Minister D.V. Chanaka, President’s Secretary Saman Ekanayake, President’s Senior Advisor on Economic Affairs Dr. R.H.S. Samaratunga, Director General of Trade Unions Saman Ratnapriya, Chairman of the Ceylon Petroleum Corporation Mohamed Uvais, Chairman of Bank of Ceylon Roland C. Perera, Chairman of People’s Bank Sujeewa Rajapakse, Sri Lanka Ports Authority Chairman Keith Bernard, Trade Union Representatives of the Petroleum Corporation, General Managers of State Banks and Trade Union Representatives of the State Banking Sector, Trade Union Representatives of Sri Lanka Ports Authority were present at this occasion.
Sri Lanka Original Narrative Summary: 08/03
- President Ranil Wickremesinghe says his Govt took many difficult economic measures to stabilize the economy & efforts are now being made to ensure economic growth:
also says the Govt received the required assurance from the Chinese Exim Bank: asserts the Letter of Intent was sent to the IMF. - Elections Commission says the most suitable date for the Local Government Election is 25th April since the poll can’t be conducted on 9th March as planned.
- IMF MD Kristalina Georgieva welcomes Sri Lankan authorities’ actions in taking “decisive policy actions and obtaining financial assurances from all major creditors including China, India & Paris Club”: says IMF’s EFF will support the authorities’ ambitious reform programme to set the country “on a trajectory of strong and inclusive growth”: analysts point out that many countries have experienced serious economic and political turmoil while following IMF programmes.
- CB Governor Nandalal Weerasinghe says Sri Lanka had fulfilled all IMF conditions with the recent interest rate hike: confirms the CB has moved to a market-determined exchange rate policy: also says he is hopeful the IMF bailout would be approved this month.
- LKR appreciates further against USD with buying rate at Rs.315 & selling rate at Rs.335: however, many analysts expect the LKR to start depreciating soon, since the Central Bank is now precluded from “pegging” the LKR to the USD as per IMF instructions: analysts also point out that in many countries in similar situations, their local currencies have depreciated extensively.
- Sex industry survey in Sri Lanka shows more men between 20 & 40 years, have registered on websites offering ‘male escort’ services after the economic crisis took a turn for the worse over the last few months: study shows more women are also turning to sex work to survive.
- Top economist Dr Howard Nicholas raises serious concerns over too much independence to the Monetary authority via the new Central Bank Bill: says the Bill, if passed, will shift Parliament’s control of the state’s finances to an unelected body.
- SLPP MP and COPE Chairman Dr Ranjith Bandara says former Finance Minister and SLPP Visionary Basil Rajapaksa played a major role in securing IMF assistance: asserts incumbent President should be thanked for the progress: claims Rupee is stabilizing,
economy is recovering, foreign reserves are increasing and tourism is picking up. - Colombo Stock Exchange ASPI sharply increases by 198 points to 9,643: Turnover Rs.3.43 billion.
- Two State Officials assert Sri Lanka expects to raise USD 4.5 bn from selling profitable and loss-making SOEs: the list numbering 14, to include SLT, Litro Gas, Sri Lankan Catering, Airport Ground handling, Hilton Hotel and “others” which have not been named: restructuring of SOEs is said to be one of the key conditions for the 4-year USD 2.9 bn IMF loan.
GMOA warns that trade unions will go on strike until the country shuts down!
Haritha Aluthge, Secretary of the Government Medical Officers Association, says that 40 trade unions, including GMOA, have decided to take a trade union action that will lead to a shutdown of the entire country by March 15.
Haritha Aluthge said this while speaking to the media after a special discussion held yesterday (07) by the Union of Professionals in Colombo.
President’s Women’s Day Message
Despite the economic challenges the country is currently facing, I am extremely pleased that Women’s Day is being celebrated on this occasion, that too under the theme “She is the pride of the Nation”, reflecting the pride, honour and strength of women.
It is gratifying to note that women account for more than half of the Sri Lankan population, and is among the social development indicators of the world’s developed countries. Today uniquely, the literate Sri Lankan woman, professionally contributes significantly to the country’s economy, and therefore is a strength of the nation.
I recall that the Ministry of Women’s Affairs of Sri Lanka was temporarily designated as one of my portfolios, with the objective of maximizing the contribution of this country’s women, in the journey to build a resilient nation, by utilizing their multiple attributes.
The Government is further committed to increasing women participation in management and political decision-making, and therefore has implemented a comprehensive program to secure an increase of women’s representation not only in Parliament, but also in the public and private sectors.
In addition, the measures required to present to Parliament, the Act on Gender Equality and Women’s Empowerment have already been initiated. It is also envisaged for a National Women’s Commission to be established as an independent body through an Act of Parliament. Further, the need to appoint an Ombudswoman as well as women to Directorate Boards in the fields of plantations and apparel have been recognized.
The Government has already implemented plans to empower women with required skills based on equality, in order to broadly contribute to the country’s economy, with the goal of creating a generation of courageous women, who understand their role in the contemporary world.
I extend warm greetings on this International Women’s Day, being confident of the support of the female generation of this country in its entirety, in order to facilitate the Government’s new reform program in rebuilding the country’s collapsed economy and create a successful “Developed Nation in 2048”.
Bill to grant independence to Central Bank presented to Parliament
The Central Bank of Sri Lanka Bill was presented to the Parliament yesterday (07) by the Leader of the House and Minister, Hon. (Dr.) Susil Premajayantha for its first reading.
This Bill was presented for ancillary matters including the establishment of the Central Bank of Sri Lanka in order to provide financial and administrative independence, and the removal of the
Monetary Law Act currently established by the Central Bank. According to the new Bill, the autonomy of the Central Bank shall be respected at all times and no person or entity shall cause any influence on the Governor of the Central Bank or other members of the Governing Board and Monetary Policy Board or employees of the Central Bank in the exercise, performance and discharge of their powers, duties and functions under this Act or interfere with the activities of the Central Bank.
Moreover, the Bill entails that the primary object of the Central Bank shall be to achieve and maintain domestic price stability. In addition, a ”Board of Governors” will be established to supervise the administration and management of the affairs of the Central Bank and to decide the general policies of the Central Bank other than monetary policy. Its chairman shall be the Governor of the Central Bank and six members with expertise will be appointed to it.
Baurs prioritizes people transformation to create resilient and future-ready leaders
27th February 2023
Photo Caption:
- Baurs Deputy General Manager of HR, Administration, Purchasing and Sustainability, Ken Vijayakumar
A. Baur & Co. (Pvt.) Ltd., also known as Baurs, a leader with diversified interests across various business verticals in the country, is gearing up for organization-wide people transformation initiatives that are centered around the new workplace norm, to build existing capabilities and be better prepared to take on new challenges.
Spearheading all employee experience efforts at Baurs is none other than versatile business and people’s professional, Ken Vijayakumar in the capacity of the company’s Deputy General Manager of HR, Administration, Purchasing and Sustainability Ken is also the current President of the Chartered Institute of Personnel Management Sri Lanka (CIPM), the leading professional body for human resources management in the country. Ken was recently recognized as the Most Outstanding HR Business Leader of the year 2022 by the CEO Magazine Sri Lanka.
Baurs recently introduced a child support benefit for the first time in Sri Lanka, which can immensely benefit its employees in the midst of accelerating economic challenges. The company continues to stand by its employees at all times, as displayed on numerous occasions previously including during the height of the pandemic by ensuring job security including various philanthropic donations and psychological wellbeing programs.
Some of its initiatives include 15 days paternity leave, employee assistance programs including those related to relief, priority for internal talent mobility when newer opportunities arise, swift onboarding and integration programs including valuable welcome packs, value boxes where one could purchase daily snacks from a self-serving facility, etc. Baurs pursue active listening, engaging and recognizing its colleagues’ milestones such as birthdays, anniversaries and achievements through internal channels such as Yammer, in addition to having an active social media presence for higher employee value proposition.
An employee’s growth and success are based on the famous 9 block grid which takes into account one’s performance as well as potential, allowing greater transparency and removing any possible biases that stands on the way including those of the supervisor.
Last year, Baurs also launched the Baurs Leadership Grooming Programme (BLG) with the aim of providing comprehensive training and development for employees, preparing them to take on future leadership roles, propelled by its rigorous expansion poised by dynamic business growth. Baurs also partners with AIESEC Association internationale des étudiants en sciences économiques et commerciales (International Association of Students in Economics and Business) to promote youth leadership among university students and create career opportunities through planned internship placements.
The company strongly believes in one’s personal growth and encourages employees to pursue higher education and attain professional qualifications. Those in the managerial and categories above are also encouraged to obtain membership of various professional bodies both locally and internationally, including taking up office bearer positions among such. They are also groomed with specialized corporate and social etiquette programs.
During April last year, Baurs also officially incepted the Baurs Toastmasters Club (BTC) under the guidance rendered by the long-standing Colombo Toastmasters Club, and the membership is borne by the company as well. This allows employees to equip themselves with the skills and confidence in developing their public speaking abilities and a wide array of communication etiquettes.
Baurs believes in equal opportunity employment and has a company-wide DEI policy ensuring that all its employees indulge in a culture that inculcates respect, honesty and integrity. In 2021, Baurs committed to the UN Global Compact corporate responsibility initiative and its principles in the areas of human rights, labour, the environment and anti-corruption.
EC declares new date for LG Polls!
By: Isuru Parakrama
Colombo (LNW): The district returning officers have been informed that the most ideal date for the Local Government Election to be held would be April 25, 2023, the Election Commission said in a statement.
Accordingly, each district returning officer will be announcing April 25, 2023 as the official date for the Local Government Election, the Commission added.
