Sri Lanka on Thursday said China has expressed its commitment to support the country’s efforts to restructure its external credit to comply with the reforms suggested by IMF for releasing the second tranche of the $2.9 billion bailout package.

Accoedingly the IMF staff and the Sri Lankan authorities have reached a staff-level agreement on economic policies to conclude the first review of the 48-month EFF-supported program IMF announced

Sri Lanka will have access to SDR 254 million (about US$330 million) in financing once the review is approved by IMF Management and IMF Executive Board.

Macroeconomic policy reforms are starting to bear fruit and the economy is showing tentative signs of stabilization.

Sustaining the reform momentum and addressing governance weaknesses and corruption vulnerabilities are critical to put the economy on a path towards lasting recovery and stable and inclusive growth.

Completion of the review by the IMF’s Executive Board requires: (i) the implementation by the authorities of all prior actions; and (ii) the completion of financing assurances reviews.

Sri Lanka has confirmed that it has reached a deal with China, to restructure $4.2bn (£3.4bn) of debt. It has been trying to reach similar deals with a number of creditors to unlock the next tranche of a bailout. Sri Lanka defaulted on its foreign debt in May 2022 amid its worst financial crisis in decades

Chinese Finance Minister Liu Kun has reaffirmed China’s commitment to extend comprehensive support for the implementation of a medium-term and long-term programme that is mutually beneficial to both parties and aimed at optimising Sri Lanka’s debt, a statement from President’s Media Division said.

The Chinese Finance Minister had conveyed this commitment during bilateral discussions held yesterday in Beijing with President Ranil Wickremesinghe, who is currently on a four-day official visit to China.

Sri Lanka commenced negotiations with its creditors, including China, Japan, and India in September of last year, in parallel to its efforts to secure the US$ 2.9 billion IMF bailout.

According to the Finance Ministry, Sri Lanka’s total foreign debt as at end-March, 2023 was Rs.36.4 billion.

As at March-end 2023, Sri Lanka owed US$ 4.7 billion to China, US$ 1.74 billion to India, and US$ 2.68 billion to Japan, which is a member of the Paris Club.

Meanwhile, during his discussion with President Wickremesinghe, Minister Liu has assured China’s unwavering commitment to providing robust support for the enhancement of the necessary infrastructure crucial for Sri Lanka’s development.

“President Wickremesinghe expressed his profound appreciation for China’s consistent support as Sri Lanka endeavours to overcome economic challenges,” the PMD statement said.

Key players in the development of Colombo Port City have finalized a groundbreaking USD 1.565 billion deal in Beijing, advancing phase two development of the Colombo Port City, encompassing the Marina Project, Marina Hotel, and Colombo International Financial Centre (CIFC) Project.

Accordingly, the corporation framework agreement was signed by Port City Economic Commission, China Harbour Engineering Company, Browns Investments and Hunan Construction Investment Group for the phase 2 development of the Colombo Port City project in Beijing on Tuesday (17).

The total investment value would be around USD 1.565 billion with the agreement covering the development of the Marina Project and Marina Hotel Project and the Colombo International Financial Centre (CIFC) Mixed Development Project. 

The agreement has been signed by the Chairman Port City Economic Commission, Dinesh Weerakkody, Chairman of China Harbour, Tang Qiaoliang, Director of Browns Investment, Kamantha Amarasekera and Chairman of Huan Construction Investment Group, Cai Dianwei.

The investment also includes the construction of an International Financial Center and the investment would be around USD 500 million. 

The construction is scheduled to begin early next year. A five star hotel too would be included under this investment.

 In addition to this development, the next mega break though would be the opening of the duty free complex within the Port City by the end of the year which is tol be operated by a Singaporean firm.

Browns Investment PLC, the strategic investment arm of LOLC Group has secured leasehold rights of additional two prime land blocks in Colombo Port City for US$98 million to undertake the development of the marina and a hotel project adjoining the earlier secured Colombo International Finance Centre (CIFC) project. 

The two newly secured land plots are most likely to be developed in partnership with foreign parties. 

 Colombo Marina Development Pvt. Ltd and Marina Hotel Holdings Pvt. Ltd, subsidiaries of Browns Investments entered into lease contracts with the Colombo Port City Commission to secure 99-year leaseholder rights of 30,776 square metres (7.6 acres)  and 13,006 square metres (3.2 acres) land plots.

It will undertake Colombo Marina Development and Port City Marina Hotel Development projects, according to a stock filing with the Colombo Stock Exchange (CSE) .

In December last year, Browns Investments in a joint venture of immediate parent of Port City project company, China Harbour Engineering Company Limited (CHEC), entered into an agreement to jointly invest and manage the Phase 1 of Colombo International Finance Centre (CIFC) mixed development project through a SPV. The investment of the project was estimated at US$ 450 million with a buildable land area spanning 3.06 hectares. According to Friday’s stock filing, Browns Investments had settled US$ 42 million for 99-year leasehold rights of the project and the balance US$ 62 million is scheduled to be settled soon

The Public Utilities Commission of Sri Lanka (PUCSL) has granted permission for the Ceylon Electricity Board (CEB) to increase electricity Tariffs from today (Oct. 20).

1. Colombo Magistrate’s Court orders the release of former State Minister Vijayakala Maheswaran in the case where she made a comment that the LTTE must be revived.
2. Speaker orders the suspension and removal of SJB MP Ajith Mannaperuma from Parliament for 4 weeks due to his unruly behaviour in Parliament.
3. State Minister of Power and Energy D V Chanaka says SL’s fuel imports are unlikely to be disturbed by the escalating conflict in the Middle East as the country has already secured tenders for supply until June’24: warns however that there could be uncertainties.
4. Study on cases of child sexual abuse presented to a Colombo-based hospital concludes that the rate of sexual abuse of females and those older than 12 years, was high: also finds that the majority of the perpetrators were known to the child, with delayed disclosure being significantly higher in cases of penetrative abuse, multiple incidents of abuse, and abuse being committed by a known person.
5. IMF says its staff & SL authorities have reached a staff-level agreement on economic policies to conclude the 1st review of the 48-month EFF programme: once approved by the IMF Board, SL will have access to about USD 330 mn: in the 18 months since seeking IMF assistance, SL has so far received only USD 333mn from the IMF, while bilateral & commercial lenders have not granted any loans.
6. Port City Colombo announces that a “USD 1.56 bn deal was ‘finalised’ in Beijing for the Port City’s Phase-2 development, encompassing the Marina Project, Marina Hotel & the Colombo International Financial Centre Project”.
7. Colombo Stock Market suffers a massive loss of value of Rs.254 bn so far in October’23, due to negative investor sentiment over lack of credible progress in resolving major macro-economic issues: Market cap of the CSE was Rs.4,537 bn as at end September’23, and by 19th October’23, it had dipped to Rs.4’283 bn.
8. Indian Navy Ship “Airavat”, a Shardul-class Landing Ship Tank (LST), arrives in Colombo: Commanding Officer of the vessel, Commander Rindu Babu calls on the Commander Western Naval Area, Rear Admiral T S K Perera during the visit.
9. State Minister of Trade S Viyalanderan says Tamil political leaders should cooperate with President Ranil Wickremesinghe and take advantage of his flexible approach to achieve national unity and address the challenges faced by the Tamil population.
10. Cricketers Angelo Mathews & Dushmantha Chameera to fly to India to join the SL squad for the ICC World Cup Tournament, as travelling reserves.

Late on Thursday (October 19), the International Monetary Fund (IMF) announced that its staff had reached a staff-level agreement with the Sri Lankan authorities on economic policies, marking a significant step toward concluding the first review of the 48-month Extended Fund Facility (EFF)-supported program.

Once the review is approved by the IMF Management and IMF Executive Board, Sri Lanka will gain access to SDR 254 million, equivalent to approximately US$330 million in financing.

In their statement, IMF Senior Mission Chief for Sri Lanka, Mr. Peter Breuer, and Deputy Mission Chief, Ms. Katsiaryna Svirydzenka, highlighted the commitment of Sri Lankan authorities to the ambitious reform agenda under the EFF. They commended the progress made, including disinflation and fiscal adjustment efforts, though some targets were still to be met.

The IMF report also acknowledged tentative signs of stabilization in the Sri Lankan economy, such as reduced inflation, increased international reserves, and easing essential goods shortages. However, full economic recovery remained uncertain, and the country’s external position had weakened due to prolonged debt restructuring discussions.

The statement emphasized the need for a swift resolution to the debt restructuring issue to restore confidence in the Sri Lankan business environment and external financing.

Sustaining reform momentum was deemed crucial for long-term economic recovery and inclusive growth. The authorities were praised for their commitment to improving governance and increasing revenues through tax measures and administration, along with efforts to eliminate tax evasion.

The IMF team stressed the importance of maintaining cost recovery in fuel and electricity pricing to mitigate fiscal risks related to state-owned enterprises. They also underlined the need to strengthen the social safety net to protect vulnerable populations.

The report concluded with a call for official creditors to reach an agreement on debt treatment consistent with IMF program parameters and debt targets. Delays in this process could further worsen Sri Lanka’s economic outlook and hinder its return to sustainable growth.

Furthermore, the authorities’ commitment to implementing recommendations from the Governance Diagnostic Report was recognized as a positive step in addressing corruption risks and strengthening accountability.

The IMF team expressed gratitude for the collaborative efforts and constructive discussions held with Sri Lankan authorities and various stakeholders during their mission.

Fairly heavy showers of about 75 mm can be expected at some places in Uva, Central and Eastern provinces.

Showers will occur in Western and Southern provinces during the morning too.

The general public is kindly requested to take adequate precautions to minimize damages caused by temporary localized strong winds and lightning during thundershowers.

On October 15, the Sri Lankan Ambassador to Jordan, J.A.D.S. Priyangika Wijegunasekara, undertook a significant visit to Classic Fashion Apparel Industry Co. Ltd in Ramtha, Irbid, Jordan. This apparel factory is home to over 1,200 Sri Lankan employees. During the visit, several notable interactions and commitments were made.

Chairman and Managing Director of the company, Sanal Kumar, along with the management team and the Sri Lankan employees, extended a warm welcome to the Ambassador and her team. They graciously arranged a tour of the factory facilities, showcasing the Sri Lankan workforce’s integral role in the company’s operations.

Ambassador Priyangika Wijegunasekara articulated her request for additional job opportunities for Sri Lankans within the factory. In a positive response, Chairman Sanal Kumar committed to creating more employment opportunities during the first quarter of 2024. He also emphasized the company’s unwavering dedication to the welfare and safety of its diverse workforce, which includes individuals from various Asian countries.

In her address, Ambassador Wijegunasekara highlighted the paramount importance of maintaining close contact with the embassy and their relatives in Sri Lanka, especially during these unprecedented times. She further emphasized the risks associated with illegal migration. The Third Secretary (Employment and Welfare) provided valuable insights into the issues of human smuggling and trafficking.

Mission officials, during an interactive session organized by the company, offered essential consular assistance to the Sri Lankan factory employees. This visit served as a platform for a constructive exchange of ideas and reaffirmed the Sri Lankan Embassy in Amman’s commitment to ensuring close coordination with both the top management and the Sri Lankan employees of the factory. These developments signal a positive step towards enhancing the well-being and opportunities for Sri Lankans working in Jordan.

The Sri Lanka SIP Academy is all set to host the 20th SIP Prodigy 2023 Competition, an exciting fusion of Abacus Mental Arithmetic and Brain Gym exercises. This prestigious event is scheduled for Sunday, October 22, 2023, starting at 9:00 a.m., and will be held at the Sugathadasa Indoor Stadium.

With participants exceeding 1,000 in number, this competition promises to be a global spectacle, with young talents coming from not only Sri Lanka but also various corners of the world, including India, Singapore, UAE, Philippines, Tanzania, Bahrain, Bangladesh, Nepal, and Malaysia.

The event will serve as a platform for children from all across Sri Lanka, spanning the East, West, and South, to come together, showcase their remarkable abilities, and foster meaningful connections with their peers.

The US Embassy in Colombo, in collaboration with the Regional Centre for Strategic Studies (RCSS) and the United States Institute of Peace (USIP), convened a gathering of scholars from across the Indo-Pacific on Monday, the 16th, for a significant conference focusing on “Ocean Security: South Asia and the Indian Ocean.”

The conference brought together an array of international researchers with expertise in Indian Ocean affairs, covering a wide spectrum of topics, including environmental security, regional cooperation, governance, peace-building, blue economy, trade, and ocean security research.

US Ambassador to Sri Lanka, Julie Chung, commenced the event with her opening remarks. She commended the network of South Asian scholars dedicated to studying the Indian Ocean. She also underscored Sri Lanka’s crucial role in the region’s blue economy, stating, “Investment in sustainable blue economies is a force multiplier, spurring economic development and demonstrating how environmental protection and economic growth are mutually reinforcing. The United States is committed to ensuring a prosperous blue economy for Sri Lanka and other nations across the Indo-Pacific. Since the launch of the Indo-Pacific Strategy in 2022, the US Government has announced the provision of over US$ 2 billion in foreign assistance in the region dedicated to Indo-Pacific priorities.”

Ambassador Chung also highlighted the strength of the bilateral relationship between the United States and Sri Lanka, which is celebrating its 75th anniversary this year. She emphasized, “the United States recognizes Sri Lanka’s right to assert its own aspirations and objectives, to be recognized as an equal on the world stage, and to make decisions aligned with its values and the needs and interests of its people. Indeed, those principles help to guide our bilateral relationship.”

Delivering the keynote address, Nilanthi Samaranayake, a visiting expert from the United States Institute of Peace in Washington, D.C., emphasized the economic significance of the Indian Ocean region. She stated, “The Indian Ocean derives its importance from its economics, which creates converging goals. The region effectively serves as a highway, connecting the bustling waters of the Pacific through the Malacca Strait and across to the Middle East and African Straits of Hormuz and Babel-Mandeb and the Mozambique Channel. The Indian Ocean sees significant traffic of hydrocarbons, containers, and bulk cargo. Due to the economic significance of this region, countries share a common interest in keeping the sea lanes open and safe.”

The conference witnessed the active participation of representatives from diplomatic missions throughout the Indo-Pacific, Sri Lankan Government officials, scholars, and members of the Sri Lankan Military.