The government is to allow private parties to supply A1 jet fuel for planes servicing at the country’s airports without any shortages.
The Minister of Ports, Navigation and Aviation Nimal Siripala de Silva has pointed out the need for a program to provide aircraft fuel without any hindrance to the planes servicing Sri Lanka.
The Minister has advised the officials that if the Petroleum Corporation is unable to supply the necessary fuel for the planes arriving and departing the country, the import of the fuel should be given to a private sector party.
It was recently revealed that the number of aircraft arriving in Sri Lanka has decreased significantly due to the difficulty in obtaining aircraft fuel at the airport.
A special discussion was held recently under the chairmanship of the minister with the relevant institutions about the measures to be taken to immediately change this situation and stabilize the aviation sector
Sri Lanka’s Cabinet of Ministers approved the proposal presented by the Minister of Power and Energy to award an opportunity to other parties who are capable of supplying jet A-1 fuel to the country.The Jet A-1 Aviation Fuel is currently supplied by the Sri Lanka Petroleum Corporation.
Due to the foreign exchange crisis that the country is currently facing, the operations of Sapugaskanda Oil Refinery, where Jet A-1 fuel is produced, were disrupted and the import of Jet A-1 fuel has also become a challenge for Ceylon Petroleum Corporation.
Due to this, the supply of Jet A-1 fuel required for the cargo and passenger flights arriving at the airport was facing a crisis situation, and the focus on alternative measures to supply the required Jet A-1 fuel for those aircraft was considered.
It has been accepted that it is appropriate to give the opportunity to supply Jet-A fuel to Sri Lanka under the maximum supply limits to the parties who supply Jet A-1 aviation fuel to the other countries so as not to hinder the supply of fuel produced at Sapugaskanda Refinery of Ceylon Petroleum Corporation.
As such, the Cabinet of Ministers approved the proposal presented by the Minister of Power and Energy to give that opportunity to other parties who are capable of supplying jet A-1 fuel to the country.
Representatives of all airlines in Sri Lanka, Civil Aviation Authority officials and Ceylon Petroleum Corporation (CPC) officials o participated in the discussion chaired by Minister Nimal Siripla de Silva to procureA1 jet fuel from private firms.
The airlines that have joined this discussion have indicated that more flights will take place through Katunayake Airport especially in the coming months when the tourist season starts. They have also pointed out that continuous fueling of aircraft is essential.
Paying more attention to the matters presented, the Minister emphasized that if the CPC is unable to meet this requirement, private sector parties should be allowed to bring jet fuel to Sri Lanka.
Several companies representing the aviation industry stated that they are ready to bring and distribute jet fuel to Sri Lanka at their own expense if the Petroleum Corporation and the Ministry of Petroleum provide the necessary permission and facilities.
The Minister instructed the officials that the CPC should promptly carry out the necessary activities to facilitate the storage of more aviation fuel, and taking into consideration the future needs, take steps to create the necessary fuel storage at the airport as well as outside it.
Private parties to supply A1 jet fuel for Sri Lanka Airports
Sri Lanka to get nuclear power technology from Russia with love
Sri Lanka is determined to go ahead with nuclear power technology with Russian assistance to unwind from the continued power outages and spend quality lives and operate businesses unhindered.
Nuclear power generation in the island nation was discussed since 1980s under auspices of the atomic energy authority headed by Granville Dharmawardena but it was not materialized due to protest of some narrow minded Scientists and CEB engineers with vested interests.
Numerous variables have been taken into account and been carefully considered in order to develop Sri Lanka on par with other South Asian countries and to make it a safer and greener home for future generations
Russia is currently No. 1 in the world for the most concurrent nuclear reactor construction projects, where three units in Russia and 34 units abroad are in various phases of implementation.
Further, being the closest SAARC countries to Sri Lanka, India and Bangladesh have also installed nuclear power plants; two in India and one Bangladesh with the help of Russian Technology to support their power systems.
Electricity generation by nuclear power is less expensive and more environmentally friendly than any other energy sources like oil, coal, and gas, with the exception of the initial construction cost.
One of the other advantages of nuclear power is that, unlike traditional power sources, which can fluctuate over time, there is little possibility of cost inflation. This could have a significant positive impact on Sri Lanka’s current situation and lessen the strain on the country’s finances
The Cabinet approved signing the international conventions relating to generating electricity using nuclear power as it was a reliable, low-carbon base load source of electricity to complement renewable energy sources in the future, Sri Lanka Atomic Energy Board (SLARB) Chairman Professor S.R. D. Rosa said.
He noted that the country is supposed to have barge-mounted small modular reactors (SMRs) that have a power capacity of up to 100 MW per unit.
Sri Lanka Cabinet of ministers has given the permission to apply for membership in two International Conventions for Nuclear damage, as the island nation explores possibilities of using nuclear power for Energy generation.
Sri Lanka prepared and submitted a self-evaluation report and supporting documents covering all infrastructure issues to the International Atomic Energy Agency (IAEA) last year.
After reviewing, IAEA said Sri Lanka needs to further develop its pre-feasibility study on introducing a nuclear power programme.
“The team also noted that Sri Lanka’s Nuclear Energy Programme Implementing Organization should prepare recommendations for the Government to make an informed decision on the nuclear power programme” IAEA said.
SL January trade deficit narrows as expenditure on imports continues to decline
The deficit in the merchandise trade account narrowed to US $410 million in January 2023, from $857 million recorded in January 2022 due to a larger decline in imports, compared to the decline in exports.
However, the merchandise trade deficit in January 2023 widened, compared to the deficit of $ 358 million recorded in December 2022.
Earnings from merchandise exports declined by 11.3 per cent in January 2023, over January 2022, to $ 978 million, continuing the moderation observed since September 2022, though at a slower pace than expected.
This decline was observed across all main categories, and the compression of industrial exports was noticeable, Central Bank disclosed in its external sector performance report. .
Earnings from the exports of industrial goods declined in January 2023, compared to January 2022, with the greatest share for the overall decrease being contributed by garments resulting from lower demand in most of the major markets (the USA, the EU and the UK).
Meanwhile, earnings from the exports of petroleum products declined due to the decline in volumes of bunker and aviation fuel exports despite higher bunker prices.
Further, the declining trend of exports of rubber products (mainly, household rubber gloves) continued, although earnings from gems, diamonds, and jewellery; and machinery and mechanical appliances (mainly, electronic equipment) increased.
Earnings from the export of agricultural goods declined in January 2023, compared to a year ago, driven by lower export volumes of fibers and desiccated coconut, categorized under coconut related products. However, earnings from tea exports improved with the higher average export prices of tea amidst low volumes.
Volumes of almost all agricultural exports remained at subdued levels in general with the lagged impact of unavailability of adequate fertilizer during 2021/2022.
Earnings from mineral exports declined in January 2023, compared to January 2022 mainly due to the decline in exports of quartz and natural graphite powder.
Expenditure on merchandise imports remained at subdued levels in January 2023, Central Bank said adding that expenditure on imports declined by 29.2 per cent (y-o-y) to $1,388 million in January 2023, compared $1,959 million recorded in January 2022 and $1,426 million in December 2022.
The decline in expenditure in all sectors contributed to this decline although the decline in intermediate goods contributed the most.Consumer goods:
Expenditure on the importation of consumer goods declined in January 2023,compared to January 2022, due to the decline in both food and non-food consumer goods.
Decline in import expenditure on non-food consumer goods was mainly driven by the reduction in the import of medical and pharmaceuticals (due to the base effect of higher expenditure on COVID vaccines in January 2022).
Expenditure on food and beverages also declined due to lower cereals and milling industry products (mainly, rice), compared to that of January 2022.
Expenditure on the importation of intermediate goods declined in January 2023, compared to a year ago, driven by lower imports of textiles and textile articles (primarily, fabrics) indicating lower garments exports in the period ahead.
In contrast, expenditure on fuel, the largest import component under this category, increased due to higher volumes of crude oil and coal imports, although expenditure on refined petroleum declined(due to lower volumes), compared to January 2022.
Government expedites Preferential Trade Agreement with Bangladesh
Sri Lanka is set to expedite the finalization of the proposed Preferential Trade Agreement (PTA) with Bangladesh under the guidance of the International Trade Office.
The proposal to this effect submitted by President Ranil Wickremesinghe was approved by the Cabinet of Ministers at its meeting on Monday.
Although trade between Sri Lanka and Bangladesh was low despite special provisions under accords the Government is confident that the PTA would be a catalyst to enhance commerce volume, official sources said.
Once finalised, Bangladesh will be the third South Asian country with which Sri Lanka has a free or preferential trade arrangement after India and Pakistan. Both FTAs have helped to enhance bilateral trade.
It is expected to strengthen relationships with key trade stakeholders at the regional level to develop market access opportunities for Sri Lankan exporters by removing market trade barriers and to achieve the objectives of attracting investment as well as to further enhance economic cooperation as a remedy for the existing problems related to domestic supply.
The current trade deals between the two countries are still partially restrictive. Both countries keep a sensitive list of products that are not eligible for tariff cuts.
Sri Lanka maintains a list of 925 products sanctioned by SAFTA (South Asian Free Trade Area) while Bangladesh keeps 993 products.
Sri Lanka’s sensitive list covers USD 6.2 million or 23.8% of imports from Bangladesh. The sensitive list of Bangladesh covers USD 77.6 million or 62% of imports from Sri Lanka. Thus, the elimination of sensitive lists may benefit Sri Lanka more.
On 14 June 2021, the Cabinet of Ministers approved the decision to commence discussions towards finalizing a PTA with Bangladesh, following the two countries agreeing to strengthen their economic relationship via a free trade pact during Prime Minister Mahinda Rajapaksa’s State visit to Dhaka in March 2021.
Both Sri Lanka and Bangladesh act as stakeholder member countries of the SAARC Preferential Trading Arrangement (SAPTA), South Asian Free Trade Area (SAFTA), Global System of trade Preference (GSTP), Asia-Pacific Trade Agreement (APTA) and Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation (BIMSTEC).
The ongoing Bangladesh-Sri Lanka discussions on a preferential trade agreement (PTA) will benefit from knowing the potential gains from reducing bilateral trade costs. In addition, knowledge of products with a higher potential for export gains will help optimise the economic benefits from a trade deal.
If tariffs on the sensitive lists are eliminated, there will be modest export gains for Bangladesh and Sri Lanka in absolute terms.
Sri Lanka will gain USD 24.7 to 49.7 million of exports to Bangladesh, while Bangladesh will gain USD 2.1 to 4.5 million of exports to Sri Lanka.
Potential export gains are given in a range due to assumptions on elasticity values used in the partial equilibrium model. Elimination of sensitive lists will generate a higher tariff revenue loss to Bangladesh, ranging between USD 13.5 million to USD 19.1 million. By contrast, Sri Lanka’s revenue loss will be slight at USD 1.4 million to USD 1.9 million.
The banking system is not inactive
Banks will be operating today to provide the best possible service to the public.
People’s Bank and Bank of Ceylon Chairmen emphasized
The Chairmen of the People’s Bank and the Bank of Ceylon both emphasized that their respective banks are ready to serve their customers today (01).
They expressed their confidence that it is the responsibility of all public servants to support the government’s program to build the country’s economy, and that bank employees will do the same.
These issues were revealed at a meeting held at the Presidential Secretariat yesterday (28) regarding matters in the banking industry.
The discussion was attended by the heads of state banks and trade union representatives, as well as the Senior Advisor to the President on National Security and Chief of the President’s Staff, Sagala Ratnayake, and the President’s Secretary, Saman Ekanayake.
There was extensive discussion about how to keep the banking operations running so that government programs are not disrupted and customers are not inconvenienced.
Mr. Sagala Ratnayake pointed out that it is not a good situation for the country to send the message to the international community that the banking system is inactive at a time when the government has taken extensive measures to create financial stability in the country.
Although it is a common tradition to issue circulars containing arrangements such as handing over the keys on the day of the strike, handing over the keys to safes containing gold, etc., when bank employees take union action, this has not occurred in relation to the joint bank union action scheduled to take place tomorrow. This was revealed during the discussion.
Accordingly, the Chairmen and the main management of the Banks agreed that the steps will be taken soon.
Ronald Perera, Chairman of the Bank of Ceylon, added that the banking system’s support is required for the government’s economic development program, and he urges all bank employees not to neglect their responsibilities to the country.
Sujeewa Rajapaksa, Chairman of the People’s Bank, stated that steps have been taken and are currently being discussed to address issues with current tax collection.
He also stated that it is everyone’s responsibility to help improve the country’s future by cooperating with understanding at this time when the entire country is experiencing economic difficulties.
Commenting further Chairman of the Bank of Ceylon Ronald C. Perera said
This country is now in a very difficult economic situation. In this situation, several trade unions have announced a strike tomorrow. As Chairman of the Bank of Ceylon, I request that our employees return to work tomorrow because the Bank of Ceylon provides excellent service to its customers. If the bank is closed for even one day, the entire country will suffer greatly.
Furthermore, trade unions demand that the government should make decisions on tax collection and tax rate reductions. As a result, we have discussed this matter with the government. These issues, we believe, will be resolved in the near future. I strongly urge the employees to report for duty on behalf of the bank and its customers.
People’s Bank Chairman Sujeewa Rajapaksa further said
Several trade unions have organized a strike for tomorrow. As Chairman of the People’s Bank, I request that you report to work as People’s Bank employees. People’s Bank makes a significant contribution to the economy of this country. We serve a large number of people and customers, as well as economic operators. As a result, we ask that you report to duty as usual and complete the necessary tasks to keep the service running. At this time, we ask that you refrain from acting in a way that will harm the government, country, or economy.
President’s Economic Senior Advisor Dr R H S Samaratunga and Director General of Trade Unions Saman Rathnapriya were also present at the discussion.
Sri Lanka Original Narrative Summary: 01/03
- Cabinet approves President Wickremesinghe’s proposal on establishing a ‘National Contributory Pension Scheme’ to allocate retirement payments for public servants enrolled since January, 2016: 08 per cent of the basic salary of a public servant and 12 per cent as contribution by the employer to be credited to the Fund.
- The Chairmen of the People’s Bank and the Bank of Ceylon say their respective banks are ready to serve their customers today; assert the banking system is not inactive despite recent trade union actions; express confidence that it is the responsibility of all public servants to support the government’s programme to build the country’s economy, and that bank employees will do the same.
- A group of Opposition MPs together with Opposition Leader Sajith Premadasa demands an inquiry into a letter sent by the Election Commission stating that funds cannot be allocated for the LG Polls; demands Finance Secretary Mahinda Siriwardena’s presence in Parliament: Speaker Mahinda Yapa Abeywardena responds saying that there should be a consensus between the Ruling Party and the Opposition for whatever steps which the House is set to take with regard to the LG Polls.
- Police debunk report on a ‘plot’ to assassinate the President as described by a website owned by a private radio channel; assert neither has the CID received such information, nor has launched a probe into any such plot.
- Tourism Ministry introduces new mobile app assuring the protection of tourists visiting Sri Lanka, following complaints on local three-wheeler drivers harassing tourists.
- NPP/JVP Leader Anura Kumara Dissanayake denies allegations on his party spending colossal amounts of money for the election campaign; stresses they never spent lavishly like other parties and exceeding the limit specified by the newly passed Act on Election Expenditure.
- Foreign Minister Sabry to pay an official visit to India from March 02 to 03, 2023 to attend the 08th Edition of the ‘Raisina Dialogue’, India’s premier conference on geopolitics and geo-economics dialogue, in New Delhi: This year Raisina will be hosted by the Observer Research Foundation in partnership with India’s Ministry of External Affairs: Sabry to sit for two special panel discussions, on the topics “Healing a Divided World” and “Bytes of Promise: How can Technology Lift Communities.”
- Cadres of pro-Tamil group ‘May 17 Movement’ hold a protest against the recent alleged assault on Indian fishermen and attempt a siege on the Sri Lankan High Commission in Chennai: Police detain cadre members as they attempted to move towards the HC: Movement Coordinator Thirumurugan Gandhi says Sri Lanka has to stop violence against Tamil fishermen, following reports on two fishermen parties from Tharangampadi and Karaikkal alleging that they were attacked by Sri Lankan fishermen.
- World Bank assures it will continue to support Sri Lanka’s development reforms programme; asserts the WB will provide technical assistance in drafting laws for development policy operations, as well as work to provide additional guidance and support regarding the use of international media and welfare benefits.
- The Appeal Court issues writ of certiorari quashing the charges against ex Finance Minister Ravi Karunanayake in connection with two cases filed in the Colombo High Court over CBSL bond issuance in March 2016.
Rain showers to be expected in Eastern and Uva provinces
Showers will occur at times in Eastern and Uva provinces.
Showers or thundershowers will occur at several places in Western and Sabaragamuwa provinces and in Kandy, Nuwara-Eliya, Galle and Matara districts during the afternoon or night.
Fairly strong gusty winds of about 40kmph can be expected over Northern, North-Central, Central and North-Western provinces and in Trincomalee and Hambantota districts.
General public is kindly requested to take adequate precautions to minimize damages caused by temporary localized strong winds and lightning during thundershowers.
World Bank’s IFC to provide Sri Lanka with $400 mln financing
COLOMBO, Feb 27 (Reuters) – The International Finance Corporation (IFC), the World Bank’s investment arm, said it will provide Sri Lanka a $400 million cross-currency swap facility to help fund essential imports.
Three private banks, which together deal with over 30% of Sri Lanka’s remittances and exports, will receive the facility to fund essential imports, including medicine, food and fertiliser, the IFC said in a statement on Monday.
The funds will provide a much needed foreign exchange cushion for Sri Lanka, which is grappling with its worst financial crisis in over seven decades partly triggered by a severe shortage of dollars.
The island nation’s economy is estimated to have contracted by 9.2% in 2022 and is expected to shrink a further 4.2% in 2023, according to World Bank data.
“We expect this financing to boost confidence in the investor community, attract fresh capital inflows to support the Sri Lankan economy,” said Joon Young Park, IFC’s Portfolio Manager, Financial Institutions Group for South Asia.
IFC is also working on further plans to support client banks with other long-term funding and advisory services in the future, the statement added.
Sri Lanka signed a preliminary agreement with the International Monetary Fund (IMF) for a $2.9 billion bailout last September but has to put its debt on a sustainable repayment track before the funds can be disbursed.
Reporting by Uditha Jayasinghe; Writing by Sakshi Dayal; Editing by Sudipto Ganguly & Shri Navaratnam
Ambassador Asirwatham meets Vice President of European Investment Bank in Luxembourg
Sri Lanka Ambassador to Belgium, Luxembourg, and Head of Mission to the European Union Grace Asirwatham met with Vice President of the European Investment Bank (EIB) Kris Peeters in Luxembourg on 20 February 20. Senior Loan Officer, Public Sector Operations, Asia and Pacific, in the Global Partners Department of the EIB Francesco Consiglio, and Head of the Office of the Vice President Anouk Hamers were also associated with the meeting.
Ambassador Asirwatham briefed the Vice President of the EIB on the current economic situation in Sri Lanka and the actions being taken by the Government of Sri Lanka, including the engagement with the International Monetary Fund (IMF) to ride out the crisis. Ambassador Asirwatham further briefed the Vice President on the vision of the President of Sri Lanka to develop an export-oriented competitive economy, an environmentally friendly green and blue economy, and a digital economy. Vice President Peeters responded by saying that the EIB was closely monitoring the progress of Sri Lanka’s economic revival, particularly the IMF’s offer of an Extended Fund Facility (EFF) for Sri Lanka.
Given that the EIB supports a large number of green projects around the world, the Ambassador presented details of Sri Lanka’s ambitious plans to become a green economy by 2050 and the various measures proposed in that direction in the preliminary report on the Sri Lanka Climate Prosperity Plan, including Sri Lanka’s commitment to supporting the Paris goals of limiting global warming, decreasing carbon emissions by 2030, and making Sri Lanka a low-carbon hub, as well as planning to achieve 70% of renewable energy in electricity production by 2030, among other plans.
The Vice President said that the EIB will continue its commitment of Euro 50 million to fund the ongoing Greater Colombo wastewater management project in Sri Lanka. He added that once the IMF’s Extended Fund Facility (EFF) for Sri Lanka comes into force, the EIB may be able to consider new financial commitments to support green projects in consultation and collaboration with the European Commission.
Kris Peeters, who previously served as the Deputy Prime Minister of Belgium, later joined EU politics before being appointed as the Vice President of the EIB.
Embassy of Sri Lanka
Brussels
27 February 2023
SL targets growing European market for Organic Food at BIOFACH 2023 in Germany
A delegation from Sri Lanka participated in the BIOFACH Trade Fair, the world’s largest annual organic food products trade show held from 14-17 February 2023 in Nuremberg, Germany. This annual trade fair held since 1990 attracts food industry professionals from across the world. This year, 2,765 exhibitors from 95 countries participated in the trade fair. The fair was also attended by 36,000 trade visitors from 135 countries. Germany is one of the largest organic food markets in the world and BIOFACH figures show that the organic sector recorded revenues of €15.3 billion for the German organic market in 2022. In Europe, Germany is the largest market for organic products as well as the largest organic producer. In addition, veganism is increasingly popular in Germany creating export opportunities for meat and dairy substitutes as well as breakfast foods.
Sri Lanka’s business delegation to BIOFACH 2023, comprising thirteen Sri Lankan companies, was led by Suresh de Mel, Chairman of the Export Development Board (EDB). The country pavilion of Sri Lanka showcased certified organic agricultural products such as spices, coconut-based products, tea, fresh fruits and vegetables, beverages, herbal products and dried fruit. The inauguration of the Sri Lanka pavilion was attended by Sri Lanka’s Ambassador to Germany Varuni Muthukumarana and EDB Chairman Suresh de Mel.
The Sri Lankan companies at the event benefitted from the exposure and networking at the trade fair which provided a forum for producers, exporters, and buyers of organic products to meet business partners, observe new trends and technological developments. The participation of the Sri Lankan companies was facilitated by the EDB, Import Promotion Desk (IDP) of the German Government and the Sri Lanka Embassy in Berlin. In parallel to BIOFACH 2023, nine Sri Lankan companies took part in a study tour of Germany and the Netherlands organized by the EDB and GIZ, the German government’s service provider in the field of international cooperation.
Sri Lanka’s organic food exports have emerged as a promising sector. The country has maintained a reputation in organic crop production and exports different varieties of organic products adhering to international standards. Sri Lanka is considered a pioneer in the Asian region championing organically certified tea and cinnamon in the world market. In April 2022 Sri Lanka was awarded its first Geographical Indication (GI) certification for Ceylon Cinnamon by the European Union. The organic food export sector is an important driver of sustainable development and job creation, particularly in rural areas.
The IPD regional office in Sri Lanka was established in 2022 funded by the Federal German Ministry for Economic Cooperation and Development (BMZ). With the aim of promoting fresh and natural product groups, IPD identifies suitable exporters and tour operators in selected developing and emerging countries to integrate the partner countries into international trade. Sri Lanka is one of sixteen partner countries chosen by IPD to support SME companies, where IPD partners with the EDB. Sri Lanka is also one of four IPD hubs where regional offices are maintained, the others being Côte d’Ivoire, Ecuador and Uzbekistan. For BIOFACH 2023, the IPD regional office provided financial assistance for the participation of select Sri Lankan exhibitors. Workshops for exhibitors were organized by the IPD and EDB to improve their networking and marketing skills at the trade fair. Next year’s BIOFACH Trade Fair is scheduled for 13-16 February 2024 in Nuremberg.
Embassy of Sri Lanka
Berlin
28 February 2023