Sri Lanka is to tap wind power in the North in a bigway following the approval given by the Board of Investment of Sri Lanka (BOI) has issued a letter of approval to India’s Adani Green Energy Limited for the two wind power plants to be set up in Mannar and Pooneryn at a total investment of US$ 442 million.
This investment of around $500 million in the power sector is significant especially at a time when SL is in poor economic shape and generation expansion plans stagnant and in disarray.
The large capacity wind power addition will come useful for reducing the power system shortfall forecasted to arise in the near future.
Now BOI approval is granted at last after much delay, these projects can be constructed on a fast-track basis as is the case in the wind industry.
Another positive factor is the ‘economy of scale’ benefit (due to large capacity) that helps to yield a competitive tariff.
The project will add 350 MW of electricity to the national grid within two years, the BOI said.
Thus, the wind power plant in Mannar will operate at a capacity of 250 MW while the wind power plant in Pooneryn will operate at a capacity of 100 MW.
The two wind power plants of 350 MW are scheduled to be commissioned in two years and accordingly, they will be added to the national grid by 2025, the BOI revealed. Furthermore, the new project will generate 1500-2000 new employment opportunities.
Industry news reports that the Adani Group have bought the design of a high-capacity wind turbine from a German organisation on an exclusive basis, and they have completed the installation of a prototype unit in India.
Sri Lankan Energy Minister Kanchana Wijesekara said on Wednesday that the progress on the renewable energy project to generate 500 MW was discussed with the Adani Green Energy officials.
In August last, the Adani Group was issued approval to start wind power projects in Pooneryn, in the country’s northeast.
At that time Adani Green Energy was issued provisional approval for two wind projects of 286 MW in Mannar and 234 MW in Pooneryn for an investment of over US$ 500 million.
Via the MoU AGEL conducted at its own cost a detailed feasibility study on the proposed project complying with existing laws of Sri Lanka, and submit the feasibility study report to the other parties for review and for acceptance.
AGEL, the renewable energy arm of the diversified Adani Group has seen a 35% year on year increase in operational capacity to 7,324 MW in India as at 31 December 2022 and is on track to complete ~ 8,300 MW, the largest in India, by end of FY23. AGEL is also the largest operational hybrid power generation capacity of 1,440 MW.
Sri Lanka goes with wind power with India’s Adani Group in a bigway
Proclamation under the Essential Public Service Act to be debated on 23 rd February
The Committee on Parliamentary Business chaired by Speaker Hon. Mahinda Yapa Abeywardena Feb-(21) decided to debate the Proclamation made by Hon. President under the Essential
Public Service Act on Thursday the 23 rd , Secretary General of Parliament Dhammika Dasanayake said.
Accordingly, the debate will be held from 9.30 am to 5.00 pm on that day, the Secretary General said.
According to the powers vested with the President in terms of the Essential Public Service Act No. 61 of 1979, this proclamation has been published in Gazette No. 2319/80 of 17 th February 2023. Accordingly, all services connected to the supply of electricity, the supply or distribution of petroleum products and fuel and health services have been declared as essential services.
Thereafter, as previously decided in the Committee on Parliamentary Business, two private member Bills, namely; Institution of Building Services Engineering & Technology of Sri Lanka (Incorporation) Bill and the Rathanatissa Peace Foundation (Incorporation) Bill are to be directed to the Legislative Standing Committee following its Second Reading.
Subsequently, the Motion at the Adjournment Time by the Opposition is scheduled from 5.00 pm to 5.30 pm.
SL Airlines extends wings to Asia-Pacific to earn much needed dollars more
Economic crisis,need to generate foreign currency income and US$ 175 million sovereign bond default like the sword of Damocles hanging over the head in a thread over which the state-owned SriLankan Airlines (SL) is restructuring and expanding its network to strong markets.
SriLankan Airlines is looking to expand its network to parts of Asia-Pacific and Europe, as it makes progress on reducing financial losses under its turnaround plan.
These countries such as Australia, and China. India remains the flag-carrier’s largest market, though flights have been reduced from 125 to 90 each week.
With negligible domestic business, the airline is aggressively tapping the Indian market to fly via Sri Lanka to international destinations Dimuthu Tennakoon, SL’s head of worldwide sales and distribution, disclosed.
“Around 55 to 65 percent of our flights [in Airbus A330-300s] to Sydney with three dailies and a daily to Melbourne comprise passengers from Bangalore, Hyderabad, Delhi, Mumbai, and several secondary Indian cities,”he said.
SL flies to nine destinations in India, which before the pandemic accounted for around 15 percent of revenues, and plans to add three more soon.
It carries significant numbers of passengers to Middle Eastern countries from South India as its fares have been competitive with those of Indian and Gulf carriers. Many of the people on these flights are migrant workers in locations including Qatar and the UAE.
“The demand from India is so strong and growing,” said Tennakoon, as the airline continues to consolidate routes. In its quest for restructuring,
SL released a request for proposal for five A320 narrowbodies and five A330s on a six-year dry lease. The bids, which were opened on February 7 and are now under discussion, could add significantly to the present fleet strength of 17 aircraft.
Last year, Sri Lankan President Ranil Wickremesinghe, who was then Prime Minister, called for partial privatization of SL and the need for restructuring as it faces payment obligations to suppliers.
It has now been almost 15 years since the Sri Lankan government reacquired all the shares in SL from Emirates, which had partially purchased the carrier in 1998.
In August, the government said it would sell a 49 percent stake in its catering and ground-handling business units. The State-Owned Enterprises Restructuring Unit is currently working on recommendations for the cabinet.
Now, as China reopens its borders, SL is to restart operations in the first week of April with tri-weekly services to Shanghai, Beijing, and Guangzhou. It has also begun offering international flights to Paris; Frankfurt, Germany; Kathmandu, Nepal; and Seoul, Korea.
H.E Woonjin Jeong, Ambassador of the Republic of Korea meets with the Hon. Speaker
A 13-member delegation from Busan Metropolitan City Council of the Republic of Korea led by H.E the Ambassador Woonjin Jeong met with the Speaker Hon. Mahinda Yapa Abeywardana recently (17).
The discussions were mainly held regarding Busan Metropolitan City Busan’s bid for the 2030 World Expo as the host nation.
State Minister Hon. K. Kader Masthan, Hon. Yadamini Gunawardena and Hon. Karunadasa Kodithuwakku representing the Korea-Sri Lanka Friendship Association of Sri Lankan Parliament, and the Chief of Staff and Deputy Secretary General of the Parliament Ms. Kushani Rohanadeera were present at this occasion.
Sri Lanka Original Narrative Summary: 23/02
- IMF Asia and Pacific Department Director Krishna Srinivasan says the IMF has not taken a decision to provide approval for Sri Lanka’s EF Facility before receiving financial assurance from China: also says the ideal way would be to await financial assurance from China.
- Chartered Accountants’ Taxation Faculty Chairman Tishan Subasinghe says Govt will record a Rs.2.4 tn budget deficit in 2023 despite the recently imposed taxes: explains such deficit will be mainly due to the increasing interest cost: also says money is being printed at a higher rate and at least Rs.1.3 tn would be added to interest payments.
- University teachers supporting the JVP-led NPP call on people to consider the forthcoming local council polls as a referendum on the popularity and legitimacy of the incumbent Govt.
- State Trading Corp GM Chamila Iddamalgoda says 2 mn eggs will be imported from India next week: Egg Producers Assn Chairman R M Sarath Attanayake says only 5 mn eggs are being produced now although the daily requirement is 5.5 mn.
- WFP’s Household Food Security Survey (Dec”22) reveals that 1 in 3 households of Sri Lankans are food insecure: nearly 7 in 10 are adopting food-based “coping strategies” such as relying on less preferred food, limiting portion sizes & reducing the number of meals: over 8 in 10 turning to “livelihood coping strategies” such as borrowing money or spending savings.
- Treasury Secretary Mahinda Siriwardene and Japanese Ambassador Hideaki sign an agreement for a USD 46 mn Japanese grant to provide 20 mn litres of diesel for public hospitals.
- President Ranil Wickremesinghe appoints a “special committee” including TRC Chairman Professor Niranjan Gunawardana on a “special request” made by the Ven. Atamasthanadhipathi Thera to investigate claims that telecom towers are harming the Sri Maha Bodhiya.
- Police use tear gas and water cannons to disperse students from Buddhist & Pali University who were staging a satyagraha in Homagama.
- BOI grants approval to the Adani Group to set up 2 wind-power plants in Mannar and Pooneryn, generating 250Mw and 100Mw power: total investment of USD 442mn and 1,500 to 2,000 employment opportunities are expected to be generated: power expected to be added to the national grid within 2 years.
- President’s Secretary Saman Ekanayake orders that all Govt officials except the Chief Justice, Justices of the Supreme Court, Chairman and Justices of the Court of Appeal should purchase Economy Class tickets for official travel abroad: adds directives issued after taking the current financial difficulties in the country, into account .
President urges all citizens to unite in efforts to overcome economic crisis and promote reconciliation
During an event held this morning (22) at Royal College, Colombo, President Ranil Wickremesinghe urged all citizens, including politicians, professionals, teachers, those engaged in agriculture, the business community, and members of the security forces, police and civil servants, to work together to overcome the current economic crisis and promote reconciliation efforts.
The event was held to honour President Wickremesinghe, who is an alumnus of Royal College. The President called upon the present generation of Royalists to dedicate themselves to serving the country and transforming it into a place where they would like to reside. He urged young Royalists to take up the challenge and shape the future of the nation.
President Wickremesinghe also highlighted that Royalists are trained to live in harmony with all races and religions, emphasizing that the country cannot be divided on the basis of race or religion. He invited all politicians who are also Royalists to collaborate with the government in its efforts to revive the country’s failing economy, emphasizing that it was not a political invitation, but rather a call for a collective effort to address the economic crisis.
The statement made by President Ranil Wickremesinghe is as follows:
“I have come here on the invitation of the Prefects of Royal College to address you. I know that you’re going to stand in the sun. I won’t make my speech long. I myself have stood in the sun like this and said when they will shut up so we can go back to the classroom. And I don’t want that to happen to me. Knowing that the Prime Minister has already said that he will not speak, but he will be the Chief Guest at the prize giving, where you will be under a hall.
Before I start to say a few words, I must thank the principals who moulded me and the Prime Minister Dinesh Gunawardena. Mr. Disa Bandaranayake, Mr H.D. Sugathapala, headmasters of the Royal Primary, Mr Dudley Silva and Mr Bogoda Premanath. We must thank them for all the influence that they and the other masters and lady teachers had on us in moulding our character.
I must also thank another member of the former Royal College Union Council, Mr Dian Pieris, who, together with me, stood up to save the name of Royal College and for all the other members of the Council who supported us. Otherwise, you would have had another name. But we honoured the intention that the country must have a school named after the President.
President Jayawardene in 1978 inaugurated the President’s college in Sri Jayawardhanapura, Kote, the new capital. I come here together with the Prime Minister to address you while we have also established another achievement of Royal College, where the President and the Prime Minister are from the same school and from the same class.
Royal’s history in politics goes back to about 1860 onwards. A few years after the Colombo Academy started when some of its outstanding students became members of the Legislative Council. They are, as you see in some of their portraits, C. A. Lorenz, and James De Alvis both of who wanted more power in the council. Sir Richard Morgan, the first Asian to be knighted, member of the Executive Committee, acting Attorney General and also Acting Chief Justice and Sir Muthukumarasami. The four of them dominated the politics of Ceylon for the first few years of our modern history. We have Sir Ponnambalam Ramanathan the first member to be elected by the Sri Lankans. His opposing candidate who lost, Sir Marcus Fernando was also a Royalist. It was a question of deciding which Royalists you are going to vote for.
1915 was the turning point in our history when we decided after the 1915 riots that we will become an independent nation. It was Henry Pedris, a young old boy from this school who was executed by the British and we started the whole campaign. Sir Ponnamabam Rahmanathan pleaded for him in the legislative council, since he was also a Royalist. E.W. Perera and Sir James Pieris went to England to plead the cause of the Sinhala Buddhist leaders. They were also Royalists. Then all the key players on the Sri Lankan side in the 1915 riots were Royalists. After independence, we had Sir John Kotalawala as the first Prime Minister after whom the Defence University is named, and we had President J.R. Jayawardene. It was actually about, I would say nearly 44 years ago when we assembled at the quadrangle to felicitate him.
So, Royal College today has in its records, four Prime Ministers and two Presidents. This is an outstanding record for any school. We also have a Sultan of Maldives who was also a Prime Minister, Muhammad Fareed Didi and the man who modernized the Maldives, President Maumoon Abdul Gayoom spent a year or more at Royal College. I think the disease of modernization, he must have gotten from Royal College. Now, we are here as the Royalists from the same class.
There is another record. The first republican constitution was drafted by Dr. Colvin R. de Silva, an old Royalist. The second republican constitution was drafted by J.R. Jayawardene, his classmate. Royalists have done it so well that no one else can change it. Now I think we have equalled that record, when the Prime Minister and I, together with the late Mr Anura Bandaranaike and Mr Malik Samarawickrama established another record. Between us, two of us have held the presidency, some Prime Ministers and one has become the Speaker, two of us have been Leaders of the House and two of us have been Leaders of the Opposition.
So this is what education at Royal has brought us and I hope you will do even better than us. That is my hope. Records are meant to be broken and not to be kept. Are any of you willing to break that record?
So, I have come here to address you at a very difficult time. A situation we have not seen in the last 400 years. A complete collapse of the economy. I won’t talk in general economic terms, but it affects all of you. In all our households, we didn’t have fuel, and electricity and those who were farming didn’t have fertilizer, we have to pay a lot of taxes and prices have gone up, inflation has come and every household has had to face the consequences. There was a total collapse of the country and when I took over the country, Mr Dinesh Gunawardane became Prime Minister, as I mentioned it was our duty to put the country first. I thought that I will take whatever decision that has to be taken to bring the economy back to at least be recognized in the world as no longer being bankrupt, within one year.
It was a tough call, but I did not want it to go on for much longer. I don’t want you’ll to suffer. We want to start fighting back and we want to have an economic resurrection. So I took all the decisions we had to take and the Prime Minister supported me. I knew the decisions I take are going to be unpalatable. It will make me unpopular. But, without those decisions, the country could not come right. And that’s what I learnt in Royal College, do what is correct and do what is good for your country. Remember that. Every decision I have taken I have thought twice or thrice on what is the burden it will impose on us. How unpopular should I become? Should I even take this decision? And when I felt that it was in the country’s interest, I took it because my first task and our first task is to bring the economy back in order. We can’t be a bankrupt country. We can’t be a beggar nation, so we have to learn that there are hard decisions to be taken in life and those decisions have to be taken. And I assure you we will by this year, see a very good improvement in our economic condition and then we will set the stage for the economic recovery of this country, not to go back to an old system which brought us down, but to a new system.
When I first came here and I came along, it was not even a ten-minute walk for me to come from there to here and we stood here in the hall, I realized one issue that all of us knew at that time. We thought we were in one of the best countries in the world because when we became independent, we were second to japan and the London Times said, we will be another Switzerland. So we were here at that time. Today, we are a country which has only Afghanistan below us. We don’t know what the future is. So when we build this future, it’s an economy that must last for 25 years. It must be a new Constitution that must last for 100 years. It must be a society not for us. None of us here are going to live for 25 years. It’s country for you’ll. Most of you here, in the first row, I don’t think you will be even 45 years old in the next 25 years.
And those in the back rows, the seniors will be around 50-55 years. That is the country you will have to live in and I want you’ll to decide what country we will live in. Not for us. That is the challenge you must take. I want you’ll to take that challenge and decide the future of the country. Just as much as President Jayawardane told us in 1977, you’ll decide what your future should be. So, I want you to be there and most of you here are living in a time when young people want to go abroad. They don’t see a future. They want to go away. But, we are Royalists and we must fight back. That’s what we have learnt to do. As you know, we have to fight both alone and with many to uphold the values that we are committed to.
So many of you will go abroad for studies and some of you will stay here. But, you must remember that this school made you a man and come here. I studied at Royal and I could have gone abroad to a university but I didn’t. My father wanted me to go abroad but I stayed here because I valued what I had. And after I passed out I did not go abroad, I stayed here because I owed my education to the state which paid for me and which sentient to the Royal College.
The Prime Minister went abroad and studied there but he remembered his obligation to the country, so he came back. And that is what you have to do. All of you come here to this school and for each of you selected, there were another 100 that were left behind. The country chose you to come here. The school chose you to come here. Then, you have the responsibility to come back to your country or stay in your country and build a new Sri Lanka.
Are you as Royalists, willing to do that? That is your task, you should come back. You should fight the odds and go ahead because we have two difficult tasks in this country. One is to put the economy into order and the other is reconciliation. We can’t be divided by race or religion. Royalists are not. So let us not do that and let us all get together. For all of you who come back, take your place in society and do your best. Whether you are at the highest level or whether you are running a normal business that’s what you have to do.
So, first I would like to ask all the old Royalists, to forget the differences and join together in bringing this country up. I am in no way telling all those in politics to join me, I am only asking all of them to get together to get over this economic crisis. I am asking those in the business world, those who are doing a small business, those who are carrying on their agriculture, and those who are in professions to join us to get over this crisis. I am asking those who are in the military services, police, public service and teaching services to join us in getting over the crisis. That is to get over it now.
But, I want you’ll to come back and ensure that you build the country again to a developed economy in 25 years. That is the task that you have.
I will not speak to you anymore but I would like to conclude with the words which we know of the oath taken by the young men of Athens, which we all had to learn in our days. I don’t know whether you learn it now. But, I would like to repeat the commitment that they gave there which we also have to follow. “We will transmit this city not only, not less but greater, better and more beautiful than when it was transmitted to us.” That is the duty of all Royalists.”
The welcome speech was delivered by the Principal of Royal College R. M. M. Rathnayake while the vote of thanks was delivered by Head Prefect of Royal College Kavisha Ratnayake.
Prime Minister Dinesh Gunawardena, Buddhasasana, Religious and Cultural Affairs Minister Vidura Wickremanayake, , Minister of Power and Energy Kanchana Wijesekara, State Minister of Finance Ranjith Siyambalapitiya, State Minister of Justice and Prison Affairs Anuradha Jayaratne, Members of Parliament Rauf Hakeem, Gevindu Kumarathunga, Priyankara Jayaratne, Duminda Dissanayake, Mahindananda Aluthgamage, Dilan Perera, Yadhamini Gunawardena, Kavinda Jayawardena, and Senior Adviser to the President on National Security and Chief of Presidential Staff Sagala Ratnayake, were also among those present at the occasion.
Govt to pay back multilateral loans of WB, ADB and donor countries
Sri Lanka takes every possible measure in paying back multilateral loans obtained via WB, ADB and bilateral partners Cabinet Co-Spokesman and Minister Bandula Gunawardena disclosed yesterday.
Treasury Secretary Mahinda Siriwardane has briefed the Cabinet of Ministers on dried up Government coffers, and calls for prudent financial management.
The Cabinet of Ministers at its meeting on Monday approved the service of US $ 2.6 billion debt payments due in the first half of this year, whilst vesting the authorisation powers to the Treasury Secretary to provide the necessary funds.
“Sri Lanka will continue to pay back multilateral loans obtained from institutions like the World Bank and Asian Development Bank as well as the bilateral partners,” Minister Bandula Gunawardena said at the post-Cabinet meeting media briefing yesterday.
A total of $ 2.6 billion, just over $ 2 billion is for loan repayments whilst $ 540 million is for interest payments. There are also $ 709 million in dollar-denominated Sri Lanka Development Bonds (SDB) to be paid with $ 46 million as interest payments.
The total amount payable in the first half of 2023 is just under $ 300 million from what Sri Lanka is expecting from the International Monetary Fund (IMF) via an Extended Fund Facility (EFF) of $ 2.9 billion within the first quarter of the year.
“Every Government has been doing this,” Gunawardena said, adding that the Parliament has approved financing the Budget 2023 with loans amounting to almost Rs. 5 trillion via financial tools such as SDBs, treasury bills and treasury bonds.
He also said that these debt repayments will be done within the borrowing limits set in the Budget for 2023.
“During Mahinda Rajapaksa regime for the 10 years from 2004 to 2014 the total SDBs issued was $ 6.5 billion, but during the four years of 2015 to 2019, the Yahapalana Government issued bonds worth $ 12.05 billion sovereign bonds.
Of the over $ 12 billion, around $ 4 billion worth SDBs in 2019 will be maturing within the five to 10 years till 2029,” he added.
On 12 April 2022, Sri Lanka announced a temporary suspension of repayment of all external debts till the ‘orderly and consensual’ restructuring of external liability obligations will be buttressed by an economic assistance program supported by the IMF.
Minister Gunawardena said Treasury Secretary Mahinda Siriwardena who was present at the Cabinet of Ministers meeting on Monday briefed on the extremely challenging circumstances in managing its cash flow and urged for prudent financial management.
“With the expected tax adjustments, the Government is expecting a total income of Rs. 173 billion, but for the essential recurrent expenditure alone it requires Rs. 196 billion, resulting in a deficit of Rs. 23 billion.
The Government must find the cash without printing new bills. This is how bad the situation is,” Cabinet Co-Spokesman explained.
People’s Convention on Good Governance convenes on Feb 25 at BMICH
A Group of eminent citizens with a real affection for the motherland has stepped in to restore good governance, maintaining peace, law and order and even going to the extent of exerting pressure on the present administration to abide by the constitution following democratic principles.
As an initial step towards this end, the People’s Convention on Good Governance will be held on Saturday 25 at the BMICH, with approximately 1600 delegates in attendance. All delegates are requested to be in their seats by 9.30 a.m. sharp.
People’s Convention for Good Governance Convener Richard de Zoysa said: “When the Central Bank of Sri Lanka could not make good our nation’s monthly international debt instalment, with economic collapse in the country.
The island nation has been dragged towards a well-nigh unstoppable downward journey to national bankruptcy, due to the many blunders made by our previous leaders and the then incumbent Head of State, with individuals, small groups and more vociferous gatherings.
They were endeavouring to make an impact and starting a trend of stepping out of their homes and openly protesting against power cuts, fuel and LP Gas shortages and of course the spiralling inflation rates, thus striving to uphold democracy and the rights of the people.
It was in this dark hour that the People’s Convention for Good Governance was born. Mr de Zoysa added.
The Trust set up for this purpose includes Dr. Walter Jayasinghe, Aeshea Jayasinghe, Dr. Sarath Seneviratne, Rashantha de Alwis Seneviratne, Richard de Zoysa, Visakha Tillekeratne, Dr. Palitha Kohona, Prof. Lakshman Watawala, Ishan Jalill, Selvi Sachchithanandhan and Jeevanthi Senanayake.
The Constitution allowed a defeated party leader to enter Parliament and ascend to the highest office of the land, plotted to perfection by a now rejected majority in Parliament.
Though democracy was not violated, the will and the needs of the masses were not exercised or considered in this process.
With all this piling up on us almost to desperation, it was obvious our country needed fresh leadership, with professional think tanks finding solutions to counter the present and to make resolute, well planned road maps for the future, hence the birth of the People’s Convention”, explained Zoysa.
Four forums on the Economy, Education reforms, Productivity and Exports and Ethnicity, represented by the best panellists available and moderated by experts will take place, with live telecasts including worldwide streaming, enabling maximum viewership.
Dr. Pakiasothy Saravanamuttu, Shehara Parakrama, Dr. Tara de Mel, Prof. Rajiva Wijeysinha, Murtaza Jaferjee, Nahil Wijesuriya and Ishan Jalill will be present. Selvi Sachchithanandhan and Prof. Arjuna Parakrama have already confirmed to be a panellist or a moderator.
An address by Jayadeva Uyangoda, an authority of the post-Independence era right up to the present day, will clearly outline the debacle that has befallen us and why this took place.
Subsequent to the Q&A session, de Zoysa will unveil an initiative by Dr. Sarath Seneviratne M.D. that will alleviate poverty and assist helpless entrepreneurs who lack collateral to fund their SMEs.
The launch of ‘The Arise Sri Lanka Website’ and ‘Payment Gateway initiated by Dr. Sarath Seneviratne will be commissioned by the Guest of Honour Dr. Walter Jayasinghe and Aeshea Jayasinghe who will also be the Chief of Trustees and the Treasurer of the Trust respectively.
This trust will seek to be a charitable organisation where Dr. Seneviratne’s initiative mooted 15 years ago for the underprivileged, will see reality on this historic day.
Govt urges JICA to resume US$ 2.5 billion worth projects halted in economic crisis
Prime Minister Dinesh Gunawardena yesterday urged the Japan International Cooperation Agency (JICA) to recommence all projects that are temporarily halted due to fiscal issues.
He made this request when JICA Director General for South Asia, Ito Teruyuki called on him on Monday (20). Teruyuki assured the Prime Minister that JICA projects would be resumed no sooner after the debt restructuring program is finalized by the International Monetary Fund.
US$ 2.5 billion worth 12 JICA projects have been temporarily halted due to the fiscal crisis. JICA delegation expressed satisfaction over the progress in debt restructuring plans, in which Japan also played a major role.
The Prime Minister thanked JICA Director General for the continuous assistance provided to Sri Lanka for several decades for water treatment, sewerage, sanitation and solid waste treatment projects in several cities and towns.
He also requested JICA to provide assistance in new areas such as renewable energy and electrification of public transport and railways.
Prime Minister Gunawardena also briefed the JICA delegation about the steps taken to improve transparency and accountability in project implementation by enacting required legizlations as recommended by the Committee appointed by the President.
He added that a Budget Act would be passed to ensure continuation of nationally important projects and policies despite change of governments in power.
Director General of the South Asia Department of the Japan International Cooperation Agency (JICA), Teruyuki Ito said that Sri Lanka’s economic reform program is progressing positively and that Sri Lanka will be supported in the future through the programs of the International Cooperation Agency (JICA).
A discussion was held between the State Minister of Finance, Shehan Semasinghe and Teruyuki Ito recently.
The program; carried out by the government to restore the economic situation in this country, was discussed.
State Minister of Finance Shehan Semasinghe explained the program further. The state minister pointed out that the reforms that should have been carried out over many years are now being carried out step by step. He commented on the oppressive situation in which the people are in with these reformations.
The state minister pointed out that the people are adapting to these reforms even though it is difficult. He said that the people have their trust on the economic stability of the country through the support of the International Monetary Fund.
IMF keeps faith on SL’s securing of all financing assurances to unlock funding
The International Monetary Fund (IMF) has expressed the belief that Sri Lankan authorities secure financing assurances from all its bilateral creditors soon, so that the Fund’s Executive Board could give its nod to unlock the envisaged US$ 2.9 billion bailout package to support the crisis-hit economy, a top IMF official said.
Sri Lanka has already received clear and specific financing assurances from India and the Paris Club nations expressing their support to restructure the debt Sri Lanka owes to them. But China, which is Sri Lanka’s largest bilateral creditor, hasn’t been responding positively as expected.
The Exim Bank of China in a letter to Sri Lankan authorities offered a two-year moratorium on China’s debt to Sri Lanka, which however fell short of a fully-fledged financing assurance.
Sri Lanka’s Foreign Minister this week said the country has completed all prior actions for the envisaged facility and implied that only China’s financing assurance remains an obstacle for Sri Lanka to unlock IMF funding.
“Sri Lankans are making every effort possible to get these assurances and as the IMF, we are at all levels helping them with that.
The best-case scenario is that we get these assurances and in which case we could go to the Board. I’m hopeful that we could get the kind of assurances we need from China, which will allow us to go to the Board in due course,” IMF Asia Pacific Head Krishna Srinivasan said.
There were news reports this week citing unnamed sources that IMF Executive Board may consider approving the bailout package for Sri Lanka even without China’s financing assurances.
However, Srinivasan downplayed those reports as speculation. Meanwhile, he said once Sri Lanka’s programme with the IMF is approved, there is time for the country to engage in good faith negotiations with its private creditors.
“Sri Lankan authorities have already started engaging with the private sector creditors very actively. Already, there is a letter from bond holders expressing support. Those negotiations will come into fruition after the programme is approved,” Srinivasan said.
According to World Bank estimates, Sri Lanka has an external debt burden of more than $52bn as of December. Of that, nearly 40 percent is owed to private creditors, including financial institutions, while the rest is owed to bilateral creditors where China (52 percent), Japan (19 percent) and India (12 percent) are the largest ones.
Locked out of international markets and unable to roll over its foreign currency debt, Sri Lanka now has to figure out how it will repay around $25 billion in principle and interest for its foreign currency debt over the next five years. Restructuring the debt is one option.